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Paying more than MSRP for (new) Hybrids, Depreciation/Value of used Hybrids

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Comments

  • larsblarsb Posts: 8,204
    I've had this discussion with you and others before, but I still fail to see where the amazing fascination comes with the "hybrid premium" and the "break even price." That's just so much worrying over something that matters not a bit in reality.

    What all the worrying is REALLY about it this:

    Irrational Fear of the Unknown.

    That's all it is. And here's the proof:

    Does anyone ever wonder about the "DVD premium" or the "ABS premium" or the "Side Air Bag" premium? No, because those are tried and true technology that everyone trusts to work, thus giving them the satisfaction of thinking the "value is 100% there" for it. Those items add more to the cost of a car too, just like hybridization.

    But those "premiums" do not keep people from buying the car and they don't pay you back gas money savings every mile like hybridization does !!

    Because EVERY SINGLE MILE you are driving a Hybrid car or SUV, you are SAVING GAS MONEY versus the comparable "gas-only" version of that car or SUV.

    Every Second. Every stop light. Every (rare) trip to the gas station. Every trip to the Soccer Game. Every trip to Blockbuster. Every trip to Sam's Club. You are saving money every second. You are (usually) polluting less, unless your target car comes in an AT-PZEV model.

    If you are like MOST PEOPLE, you have a CAR PAYMENT every month. Why not have that car payment be for a car that saves you gas money every second you drive it? So what if the said car payment is $450 versus $410 ? You are putting gas savings in the "virtual bank" every single mile you drive !!!
  • cdptrapcdptrap Posts: 485
    In the end, there is no convincing each other, there is only expressing our own positions and views so others can understand us while we agree to disagree.

    Hybrid car economics debate is similar to installing solar power for our homes. Those who look strictly at economics will not use solar because they need to see a "positive cash flow". A neutral cash flow means there are "no benefits" and a "negative cash flows" definitely is a deal breaker. They are not wrong, just have different focus and emphasis.

    Same for the hybrid. Those of us who look at pure numbers will not buy one. Realitically, not many of us have the time to quantify the tangible values of pollutant reduction, reduced reliance on foreign oil and on potential gas price increase over the next 10 years.

    Some of us see producing only 2 lbs of pollutants in 100K miles versus 2000 lbs in 100K miles as having tangible "cash" value. Some of us believe in "act locally, think globally" so we see tangible "cash" value in reducing our personal gas consumption whenever possible. Some of us also believe that the current struggle for oil between us (US), China and India will only worsen over the next 10 years, so we want a hedge against rising gas prices. I happen to be in this camp.

    On the other hand, hybrid vehicle is currently expensive and until it comes down in price, the general public will think twice abouce putting down $5K for a car. $5K is a lot of cash when one is worrying about house payment, kids' college, retirement and all the mainstream concerns.

    Early adapters like us will have to take the plunge. If there are enough of us, may be our purchase will drive down the cost making it a no brainer for my children and everyone else.

    My gut feel is this hybrid technology, like auto-trans, ABS, Stability Control, is just another new technology that will eventually find its way into all cars. It is an evolution in auto technology whose time has arrived. We will likely all love at this debate 10 years down the road.
  • larsblarsb Posts: 8,204
    I completely understand there is "no convincing" although there IS the possibility of making someone "think" for a second that maybe it's not "my way or the highway" in every situation.

    I'm coming up on middle age and I'm making every effort to be "open-minded" when it comes to issues I have traditionally been pretty stubborn about.....:D

    I do hope you are right that the "first Big Wave" of Early Adopters help those further down the line. Something else to be positive minded about as a Hybrid proponent and owner.

    I also see hybridization as a "option" in future cars. Toyota HAS to do that if they keep their promise of Hybridizing their entire line of cars. No way they can try and "force" a $2000 to $3000 option on people and expect to be successful like they have been.

    I just hope things keep going as well as they have gone in 2005 for the Hybrid movement....:D
  • tdohtdoh Posts: 298
    How about answering the question that gets asked over and over again regarding hybrid vehicle purchases:

    Why did/would you buy one? Is it because you want to reduce the amount of money you spend on filling up? Or because you want to do your part in either saving the environment and/or reducing the dependency on oil? If you were really serious about doing so for either reason, then you should really put your money where your mouth is and either take public transportation, ride a bike, or walk to/from whereever you need to go...or at least carpool. Even though hybrids spew out smaller volumes of pollutants vs. a gas-ony vehicle, they still spew them out; to add to that, they still burn gas, period...so you're still consuming oil resources. And speaking of oil--the gas engine in the hybrid still needs motor oil for engine lubrication. They don't alleviate traffic issues, since you'd essentially be replacing one vehicle with another--assuming you drive a vehicle to begin with. I mean, if you have to deal with bumper-to-bumper traffic on a daily basis...I'd bet you'd agree that a gas-only vehicle with 4+ occupants is clearly preferable to each of those 4+ folks driving solo in their hybrids instead. Too much traffic may very well lead to too much pollution, but very little pollution spewed from vehicles isn't always necessarily the result from less traffic.

    I might get slammed for saying this, but I bet that there are more than a handful of hybrid owners out there who bought one primarily so that they can jump on the hybrid bandwagon...the fact that they could very well reduce their gas costs was secondary in their purchasing decision.
  • mirthmirth Posts: 1,212
    ...I'm not a big believer in hybrids myself, in the owners' defense, just because they bought a hybrid doesn't force them to sign up with the Sierra Club. It's certainly not hypocritical of them to just buy a hybrid without having to go plant a tree or something. The fact of the matter is that, for most of the nation, public transportation, biking or walking to work, and carpooling are either impossible or extremely inconvenient. While I don't think hybrids make sense from a cost/benefit analysis (IMHO), they are at least greener than an equivalent ICE car.
  • gagricegagrice San DiegoPosts: 29,035
    I'm sure that most hybrid owners are NOT rabid tree huggers. And as many have posted they consider the extra cost of the hybrid technology to be an option like getting a V6 instead of a 4 cylinder. To me that is not the issue I have with the hybrids. It is the added complexity and the longevity factor. To say the Prius II is reliable for the long term after a year and a half on the road is a pretty bold claim. We don't have a good record of reliability on the first Prius. I would not for a minute believe the claims of Toyota or any other manufacturer. Has anyone got a long term reliability study on the first Prius? That would be a start. We know they got a good mark for the first 90 days. What I do find interesting is the quality of the 2004 was not as good as the 2003 Prius. I don't recall the failures on the Prius Classic that have been reported on the Prius II. Maybe in 5 years I would buy one. I usually wait till the end of the model run, when the bugs are ironed out.

    http://autos.yahoo.com/newcars/toyota_prius_4doorliftback_2005/16237/style_reliability.htm- l
  • falcononefalconone Posts: 1,726
    The 2004 Prius is reliable. Much more so than anything Germany has rolled out lately.
  • gagricegagrice San DiegoPosts: 29,035
    The 2004 Prius is reliable.

    That is what all the hoopla is about. If you buy a new car and you don't have any trouble it is reliable. If it has trouble it is not reliable. Why did JD Powers rate the 2003 Prius better overall quality than the 2004 Prius? Did Toyota get sloppy with their exuberance to build more hybrids? As far as German reliability. This is my first German car since 1967. It is reliable so far and the one trip to the dealer was an excellent experience. Much nicer than time I spent at Toyota. Lexus & Honda dealerships over the last 15 years.

    On the subject. I would not buy a German, American or Japanese car at MSRP if I lived to be 100. It is money down the toilet. The odds of finding a sucker like the writer in the LA Times, is rare. It will be too late when they realize what a BIG mistake they made. To pay $18k for a 3 year old car that can be bought new for $22k is crazy. You would not do it.
  • midnightcowboymidnightcowboy Posts: 1,978
    Apparently some people are beginning to have software stalling problems on the Prius: http://www.thebostonchannel.com/buyerbeware/4554961/detail.html

    Actually why compare German, when the Japanese is the hallmark of reliability.

    cruis'n in 6th :shades:

    MidCow
  • falcononefalconone Posts: 1,726
    Statistics speak for themselves and the quality of Japanese cars as a whole are a lot better than German cars. I'd rather own a Honda or Toyota than a VW any day of the week. As for the person buying that Prius for 18k! There are tons of idiots out there.. what can I say? Oh..I read that other post on the other forum... was that you on 405 with your hood open or was that guy kidding?
  • gagricegagrice San DiegoPosts: 29,035
    Statistics speak for themselves and the quality of Japanese cars as a whole are a lot better than German cars.

    Statistics mean nothing to the guy stuck along the highway with the a dead Prius, BMW, Lexus, VW, Chevy or Porsche. Unless the Japanese got their act together since 1994 when I bought my last Toyota, they were far from reliable. My 4 Chevy trucks since 1988 have been far more reliable.

    It would be even worse if you paid a premium for a car that was not dependable. You would feel trapped because you would know you are stuck with a car that was not all you had hoped for. Several of the Prius owners with problems are less thrilled with their car than before it died on them. I consider hybrid premium & problems the price you pay to ride the leading edge of technology.
  • falcononefalconone Posts: 1,726
    I rather rely on statistics overall. I happen to be lucky when I buy cars. If I bought a GM car, I'd bet it would give me good service as well. All the Prius owners I know (they're well informed) have never had a problem. Bottom line? I'd rather be driving a Toyota than a VW.
  • gagricegagrice San DiegoPosts: 29,035
    I'd rather be driving a Toyota than a VW.

    That is based on reputation or experience. If you drove a Passat then an Accord or Camry you would not be impressed with the driving experience. If your biggest concern is reliability or you like to street race, then you may be on the right track. I just think the whole package presented by VW is better than Toyota. To me handling and braking are at the top of the list. Maybe if I had not started buying Toyota's 41 years ago I would have a different impression of their commitment to quality. I think they are more out to get the most money for the least amount of car they can get away with. Their profit sheet bears that out. I have spent more money repairing 3 Toyotas than all the other vehicles I have owned. Starting from the first 1964 Land Cruiser to the last 1994 PU truck. Toyota's are cheap built. I feel for those that have paid a premium for the Prius. They will more than likely lose a lot of money over the long haul. Not going to have a great TCO.
  • midnightcowboymidnightcowboy Posts: 1,978
    Falconone,

    You not using Buick's old ad jingle are you :confuse: "I'd rather be driving a ..."

    I agree with you statistics and unbiased reporting: J.D. Powers and CR (somewhat skewed because it is based on actual owner input; more like to complain to to accolade) are the best inputs. However there are always extremes and maybe a single 1994 Toyota PU was a statistically problematic car at the bad, unreliable extreme.

    However, I find there is a great deal of good information to be garnered from the Edmund's Auto forums. Sometimes you have to sift through the "i know more than you" or "i am better than you" message drifts or the recategorization on threads, but overall there is a lot of very good actual experiencal input. By the way Falconone thanks for your input.

    Cruis'n in 6th :shades: ,
    MidCow
  • john500john500 Posts: 409
    I'm an advocate of hybrid technology, however, I see some serious problems down the road regarding the cost of automobiles if people are willing to pay more than MSRP for them. A few more moderate gasoline price increases, some favorable PR for Toyota and Honda, some poor earnings for GM and Ford, and then voila, a situation analogous to the housing market will occur with cars (i.e. overvaluation and what ultimately winds up as actual inflation due to "consumer tastes").
  • bioya4bioya4 Posts: 5
    The Lexus dealers have an interesting scam going. The $1,000 deposit you pay to get on the list for the RX400h is not creditted to sales price at closing. That fee raises the cost of the car by $1,000 even though technically you are still paying list. It is pretty short-term thinking on their part though. We took delivery on the RX400h but will never buy another Lexus again.
  • blaneblane Posts: 2,017
    bioya4:

    Are you sure that "Lexus dealers have an interesting scam going"? Your experience sounds like it may have been the policy of one particular dealer. It is totally probable that certain dealerships will attempt to milk the market for whatever "Additional Dealer Markup" or "Market Price Adjustment" bucks they can get. However, I would be very sceptical about the widespread nature of a situation similar to your $1,000 deposit experience.
  • mirthmirth Posts: 1,212
    ...you're probably lucky it was only $1000 over.
  • falcononefalconone Posts: 1,726
    MidCow... you probably made the wisest choice of everyone here by purchasing the Honda 6 spd. I am sure you will get years and years of reliability and driver satisfaction out of that vehicle. I've owned an Acura Integra (1990) for 8 yrs before it was stolen. It was an extremely reliable car. If you maintain it well, it will last you a long, long time. I must say I love the feeling of a German car (I've owned two audis). They just are way too temperamental and problematic. The BMW is my choice of all the German cars. My friend is picking up an Acura RL (05) tomorrow. Can't wait to drive it! Enjoy the cruisin'!!!
  • tomslycktomslyck Posts: 70
    Bioya4,

    That is definitely a dirty trick. That's the kind of thing that gives car dealers a bad name. I think I'd send a few letters to interested parties (Better Business Bureau, state bureau of consumer affairs, local newspaper, Toyota national headquarters, etc.). I'd be sure to give them $1,000 worth of pain for their scam. This posting was a good start.
  • mirthmirth Posts: 1,212
    I'd be sure to give them $1,000 worth of pain for their scam. This posting was a good start.

    On the other hand, the dealer would probably be happy to give you your $1000 back and then sell the car for $2000-3000 over MSRP. Face it - the 400H is in huge demand and there's a price to pay to be the first on the block. If you don't like it, then either a) don't buy the car, or b) buy somewhere else. I have a feeling you won't get a better deal though...
  • otis1otis1 Posts: 142
    I agree with you (mirth) to a point. a "fair" price depends on the market, how much the next dealer is selling for, how much work you're willing to put it to get a lower price... on and on....

    but if the dealer said "pay $1000 DEPOSIT to get in line and pay MSRP," then the buyer was ripped off. if the dealer said "Pay $1000 for the PRIVLEDGE to get in line and pay MSRP," then all is "fair." (it happens on ebay all the time) If the dealer said the 2nd line last year, then the buyer could have shopped around at a different dealer. If the dealer said the 1st line, and the dealer changes the deal on him, then what can he do today? he'll have to get on the end of another list or pay $2000 to get the car now at another dealer. if this was the case, then it's a dirty tactic.
  • mirthmirth Posts: 1,212
    ...lead to my suggestion of b) buy somewhere else.
  • stevedebistevedebi LAPosts: 3,800
    Unless the dealer had give written notice that this deposit was to be forfeited, I think that you would have an excellent chance of getting a judgement in small claims court. Normal practice in the industry is to take a deposit and include that amount in any renumeration paid for the vehicle.

    Take 'em to court - no lawyer needed, just bring in your deposit slip and the paperwork from your deal. I would also write a letter to the dealer protesting their action, be sure and get a return receipt, and wait a couple of weeks. If the dealer doesn't respond or fails to deliver satisfaction, you will probably get your $$ back from the judge.

    I you do take them to court, request that the judge also add money to the judgement to compensate for your time, costs, and mental anguish. Small claims court will handle cases where no more than $5000 is involved, so keep the amount requested below 5 grand.
  • tomslycktomslyck Posts: 70
    I like Stevedebi's idea of small claims court. You might have to show that losing your place in line would cause some damage, though. Good luck.
  • mirthmirth Posts: 1,212
    The problem is not proving whether the deposit was refundable or not, it's proving that the dealer agreed to sell the car for (MSRP-the deposit). I'd be surprised if that's in any paper form - they probably just told them "MSRP". In short, the person has already bought the car and driven it away, so it's pretty much a done deal. If they had really been upset about this they would have aborted the entire transaction. Methinks that a lawsuit would be a lesson in futility at this point...
  • stevedebistevedebi LAPosts: 3,800
    "The problem is not proving whether the deposit was refundable or not, it's proving that the dealer agreed to sell the car for (MSRP-the deposit)."

    No, I disagree, the point is that the deposit should have been applied to whatever price was paid, and according to the original post, they basically forfeited the deposit - it was not applied to the purchase price.

    It the dealer wanted to inflate the purchase price by $1000, then I could see your point, but that is not what the person said. Perhaps that is what they meant. But in any case, that $1000 should have either been refunded, or clearly applied to the purchase price. That $1000 belongs to the purchaser unless it has been clearly accounted for and documented. Common industry practice would indicate it should have been taken out of whatever amount became the agreed sales price.

    Take 'em to small claims court. If you have some questions, ask a lawyer; it is worth the $100 or so for an hour of his/her time to give you a legal opinion.
  • mirthmirth Posts: 1,212
    ...the deal was simply shown as MSRP+1000. We don't know.

    Again, the person bought the car and has been driving it. I doubt a judge would force the dealer to refund anything. As far as the lawyer goes, it's a $100 just to find out whether court is a good idea, plus whatever your time is worth. If it is a good idea, it'll be a lot more than that. Even if they won, they'd probably end up netting about $100. Not worth the aggravation. Chalk it up to experience, don't buy from these guys again, and move on.
  • stevedebistevedebi LAPosts: 3,800
    "As far as the lawyer goes, it's a $100 just to find out whether court is a good idea, plus whatever your time is worth. If it is a good idea, it'll be a lot more than that. Even if they won, they'd probably end up netting about $100."

    Well, you don't use lawyers in small claims court - you represent yourself. I was just suggesting that the lawyer be consulted as to the law, before proceeding on the claim. If the judge approved a settlement, I imagine that lawyers fee could be part of the judgement.

    RE: Already bought the car.

    Doesn't matter, if the dealer did something illegal or contrary to normal practice, they may be liable. By that logic, if someone stole my wallet and I waited a day to tell police, the thief couldn't be prosecuted...
  • mirthmirth Posts: 1,212
    What was illegal? The person signed the papers and drove away with the car. Whatever happened before that is irrelevant. They could have gotten their deposit back and gone elsewhere. Until the contract was signed, money paid, and the car was driven away, there was no legally binding deal, so I think court would be a waste of time and money. Here's how I see it going in court:

    Plaintiff: "He said the deposit would go towards the price."

    Defendant: "No we didn't your honor."

    Judge: "It is vague here...wait, you bought the car for the dealer's price?"

    Plaintiff: "Yes sir, but it wasn't fair."

    Judge: "Boo hoo. Next case."
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