Everyone knows that I love used cars. And I like REALLY used cars, as in cars from the 80's. But that's a discussion for another day.
What about cars that are only used for 1-2 years? I just don't get why people NEED to buy new cars so badly. Sure, there are junker used cars, but there are also a ton of good used cars out there. Ones that have low miles and ones that you would not be able to tell were even used.
There are so many options today too. In the past, if you didnt know how to inspect a car, it was pretty easy to just bring a car to a mechanic to get it checked out. But nowadays, there are so many certified pre-owned options, where the dealership thoroughly checks the car out and even extends the warranty on the car. Yes, you pay a bit more for this peace of heart, but you are still saving SO much over a new car.
There are obviously people out there buying these used cars, but there are still plenty more who will never drive anything used. I mean, you're almost throwing your money away. Most new cars depreciate 40-50% after 3-4 years of ownership.
The people who demand new cars also seem to be the same ones who want the high end luxury cars. And those are the cars that depreciate the most! Take for example a 2004 Mercedes E320. It was about 55-60k out the door when new. You can now buy one used for about 20-25k. Was it really worth the 30-35k to have a "new" car over the last few years? What about a 2002 Mercedes S500? Brand new, the car cost around 85-90k. You can buy one used now for about 20k. For those of you who are bad at math, thats a loss of 65-70k!! That's like a downpayment on a house!
To me, these price differences are enough to justify buying used. I mean, if you're just buying used because you are cheap (which I am), then I can see why people don't want to do that. But you're losing tens of thousands of dollars! AND you can buy a used car which still looks like it's new. The 2004 mercedes E320 which i mentioned is still the same model being sold. You're not required to downgrade to something that's unsafe or has no power or looks terrible.
Let's see what Sam has to say
Sam:
Alright, I can see where Will would recommend buying a used car vs a new car. But! Have you noticed the types of cars he's doing his analysis on? They're all uber expensive luxury sports cars.
For starters, if you're buying a more economical car the situation is vastly different. Lets take the Honda Civic as an example. The MSRP of a 2009 Honda Civic is about $19,800 but... no one really pays MSRP for a new car. If you did... you got ripped off. Lets figure you can get $800 off to make the math a little easier. So the total cost to you is about $19,000. Craigslist has several 2005 Honda Civic EXs for about $14,000. Of course.. you should paying a little less then their asking price. Lets say you search hard enough and bargain to bring the price down to $13,000. By going with a 4 year old Civic, you're only saving 6k. That equates to about a 32% savings for a 4 year old car. But think about the cost of ownership for the first 2 years. Chances are, your 4 year old civic has about 60k miles. After the first 2 years you owning the used civic, you'll probably need new tires ($500), new brakes ($300) and a major service checkup ($500). With the brand new civic, everything is new, so you probably won't have to change anything for the first 4 years or so. At most you'll be spending $300 on trip to the dealership for a minor service checkup. So your 6k savings is more like 5k after the first 2 years of ownership. This equates to only a 26% savings for buying a used car. Hrm... that 4 year old used car isn't looking as good now.
even the "smallest" engine is 10.8L and makes 500hp and 1550 ft-lb of TORQUE!
