There's probably more than one sweet spot for buying a used luxury car, but I've concluded that the sweetest one is to buy one just before the typical five year factory warranty expires, with no more than 30,000 miles on the odometer. I would include one that's a few months older than five years, with a few more than that number of miles, if the owner (in the singular, because it gets harder to gauge how the car's been driven after the first owner) had been meticulous about maintenance. By this point most of the depreciation has been borne by the original owner, but the car still has ~80% of it's useful life ahead of it.
As we've noted in this discussion, the depreciation on used luxury cars has accelerated significantly during this recession, especially for those who can pay cash, so it's a great time to buy. What I'm not sure of is the sweet spot for selling or trading the hypothetical 5 year old, 30,000 miles car. I'm thinking that age is less important than mileage, so maybe age can be disregarded, and one should follow shifty's suggestion (if I'm recalling correctly) and bail out at ~80,000 miles. Do I have the sale part about right?
What about doing the necessary maintenance and repairs and going to 150,000-200,000, so you enjoy the full benefit of your expenditures. I mean, why spend the money, only to sell at, say, 110,000-120,000 miles?
My strategy was always to buy very *very* well-cared for luxury cars that someone else had JUST dumped a boatload of money into, then drive them a quick 5K--10K and then bail out while everything was still okay.
Replying to an old post, I know, but I had it bookmarked...
I'm not sure how commonplace this situation was back in the "good old days," but today I don't see many used cars for sale, luxury or otherwise, where the owner has just invested a lot of money in repairs. It's usually more like "1998 Luxomobile for parts" or "2001 Cloudmobile transmission needs fixed [sic]."
I can see buying a used car and flushing all the fluids, replacing wiper blades, and changing the timing belt, tensioner, and idlers, where applicable (a grand or so, I'm guessing), but buying something that's not driveable sounds like a losing proposition.
Good point. What you might see today is a well-cared-for luxury car that has had money dumped into it previously on a generous scale of maintenance and repair, but that is now facing YET ANOTHER repair bill----a repair that in and of itself might not be all that formidable but that has finally discouraged its loving owner. (i.e., "the last straw").
Perhaps it is the frequency of the repair bills rather than any other reason original owners get frustrated & under emotion rather than reason, trade it off only to buy another yet to be repaired luxobarge.
Before letting emotion rule, determine if the first year depreciation and sales tax on a replacement vehicle is more costly than repairing the original. Of course it is, but by how much?
I often tell people to add up and average 12 to 24 months of repair bills, and if that monthly average equals 1/2 of the cost of a new car monthly payment, or even lease payment, (+ lease cap reduction costs) it's really time to bail out. So if you're pumping $300 a month into that old luxo-barge, maybe that's not a good idea anymore.
The last half of a car's long life is rarely the best half.
After reading through the thread, I have one question. At what point (as in, a year, or range of years) did cars start getting so electronically based so that they would not be worth repairing if things went wrong with them?
Too wired? Sounds like the 80s. Advanced engine controls gave stone-age internal combustion engines a new lease on life. For a somewhat shorter life that is. Fussy electronic controls + bland products of that era = Orphaned 80s cars
A time to embrace, and a time to refrain from embracing.
Well if the past is any judge, when the electronics get so obsolete that a) there are no replacement parts and b) you need a specialist to rebuild them or c) someone has some new old stock and will gouge you for it....then you have to start consulting the price guides to see if you are being a dope by putting $3000 in electronics into a $2500 car that has, after all, lots of other used parts on it that may fail as well.
My friend's 1998 BMW 750iL is a great case in point: his dashboard has (mostly) gone blank, one rear window doesn't work, he gets constant bulb out warnings, etc. and now water intrusion has ruined some module under the rear seat. Car runs great (or did anyway), looks okay, but it's simply not worth fixing anymore.
I think there was a crossover time in the late 80s-early 90s when this happened. For large MB it was 1992, when the W126 was replaced by the W140. The former still has DIY potential, the latter is a complex money pit if things go wrong. For big BMW it was 1988 with the new E32 7 series.
I think of cases like this when people brag about engines that will last 300K. OK, but the electrics don't. And on some cars, a set of new ABS sensors or something similar costs more than a junkyard engine.
Was there ever a happy point in time when you could get decent fuel injection but not be bogged down by a bunch of hard to replace electrical compents?
I have been around cars my entire long life and I could count on one hand the number of engines I've personally seen with over 300K, and none of those could be verified beyond the owner's claims that they were "never worked on".
Engineers don't design cars to go 300,000 miles. Some do, no doubt, but most fall apart before that, or get wrecked, or become too expensive to fix, or become impractical for the world they live in (like 10 mpg @ $3.55 a gallon).
I remember one old Benz a 560SEL, that had very high mileage. A friend of mine wanted to buy it. The seller insisted it's been a "great car" and he used it daily.
So I sent the car over to my very trusted friends who repair German cars and, even with cutting corners, they figured it needed about $8000 in critical repairs. This included worn steering parts, bad tires, inoperative electronics of various sorts, leaks, fluid changes, belts, hoses and a timing chain.
Sure the seller got his 250K out of it, but he squeezed it dry like a lemon. The car had nothing left in it but sheer willpower to go another mile.
I think you guys are right. The birth of that BMW E32 platform might be a good "anchor" to mark the spot where expected mechanical lifespan and electronic half-life converged to form ultimate depreciation in the german luxury market.
Just a thought, would the C4 Corvette qualify as a Detroit example of "depreciate to (near) zero" technology in the 80s? The cross-fire engine, dig dash, clamshell body structure all seemed to promise that it would never be saved by the hands of car hobby guys in the future.
But like that BMW 750, a good running C4 is a good performance car. Handles like a slot car and the crude overhead valve 350 pulls strong. But when it's over, well, it is over. :sick:
A time to embrace, and a time to refrain from embracing.
Was there ever a happy point in time when you could get decent fuel injection but not be bogged down by a bunch of hard to replace electrical compents?
Early '90s Japanese compacts? EFI meant that most of the Rube Goldberg vacuum controls were gone, and the lower and midline cars weren't gadgeted up yet. Plus, any Japanese car from that era worth driving has a colossal aftermarket these days.
The 84 crossfire Corvette was a carry over from the 1982 system. The problem is not that it is so "bad", but that it defies modifications, rendering the '84 Vette the un-favorite of all Corvettes, period. Coupled with that rather weak 4+3 transmission, there's not much to like.
Classic case of obsolete technology dragging the car's value to near oblivion.
You remember that pristine C4 that was for sale for $6500 that I posted last year? It's still for sale. He can't get that price.
I remember that C4 looked really nice, 2 tone silver and something...can't find the pic now. Surprised that nobody made a decent offer by now.
I went digging and found some odd comps between the un-favorite Corvette and some late 70s Camaros. Realize these are just "asking" prices but still they are posted for similar money, $5k to $6,500.
Here in Ahia: Decent C4 with working dig dash and nice leather, low miles, automatic, etc. A bit rusty '79 Camaro for a bit more money?
Even in Washington state: Really nice looking C4, probably let it go for less than the asking price. Ratty old Camaro Berlinetta asking a lot for getting so little.
Even though I called the C4 out as a neg example of 80s tech run dry, I'd still buy either of these C4s - or preferably the nice one posted last year - before either of the comp priced F-bodys from the late 70s. At least the Corvettes will GO. For a while anyway! :shades:
A time to embrace, and a time to refrain from embracing.
yeah but....the ride will punish you and the top will leak all over you. I think the price will drop even further at this rate. This could become the cheapest running and licensed Corvette you can possibly buy--maybe it already is.
You could buy a really nice late 90s Benz E320 for that money.
That's proof of the unloved rank which the '84 Corvette holds. Despite the performance it could deliver on a track, nobody really "loved" it. Probably because you can't. Too many negatives in the balance and the market bites down hard.
Still, a jarring sight when ratty malaise F-bodies are offered at prices similar to a decent C4.
A time to embrace, and a time to refrain from embracing.
Every Porsche 944 ad seems to say "odometer broke when I reset the trip odometer last time I refilled with gas". I always assume these cars have a minimum of 200K on them.
I dunno...for a while the 750's dash starting reading in German. I think he got the whole thing fixed once for $3000 and he just gave up. So he gets some functions but not others. No odo, no radio display, no trip computer, no brake lights, no power windows on one side (??) water leaks, trim pieces falling off regularly, window seals all cracking.
Runs great, though, like a freight train, and still handles and brakes very well.
Like the seller says, wiring on those cars is the killer, it decomposes. If your early W140 hasn't had a wiring harness failure yet, it will. Eco-weenies infiltrated the engineering, and now we are dealing with the result.
That car was 120K new, albeit 19 years ago, but still. Nice parts car though.
My current daily driver these days is a 1999 Volvo S70 (my mother's former car) and it's got a hair over 106k miles now, and all maintenance and required repairs have already been done to bring it up to snuff. However...
Shifty, and others - I'm really dreading the day when I need to do a $3000+ repair on this car, since it comes from the "new" electronic Volvo era. I don't want the instrument cluster to start randomly reading in Swedish, oil leaking from the tranny, or lighting going haywire. But I guess I'll have to live with it. Advice/tips?
That's a really a high cost per mile. It puzzles me how they can continue to sell cars like the 7-Series. I know, some people have more money than they'll ever spend, but still... I guess it's largely due to the satisfying driving experience of German cars. That's largely why I've owned two of them. They also tend to age well, in terms of styling.
So, around 1988 for BMW and 1992 for Mercedes. What about other luxury makers like Jaguar or Porsche or the Japanese makes like Infiniti or Lexus? When do they become too dependent on computers/electronics to make them infeasible for long-term use due to the super-high expense of repairs?
Jaguars always have electrical issues, no matter the age - even the new improved ones can be glitchy. I'd run away from anything pre-1995 or so, and then they become complex Porsches tend to be solid, but some models (944, 928) can be maintenance-intensive to say the least, and I wonder how gadget-laden models will age - who will want a 20 year old Cayenne? The Japanese makers were later to the high end scene, so all of them are loaded with electronics...they do tend to be more reliable than Europeans, but nobody can escape age. Even old Lexus fail, eventually.
That's a really a high cost per mile. It puzzles me how they can continue to sell cars like the 7-Series.
I wonder if most of the people with cars like the 7-Series, Benz S-class, Audi A8, etc, lease them rather than buy, and then just turn them in? Or, even if they do buy, they trade after a couple years?
Then, as used cars, I think they tend to fall into the hands of those that really can't afford them, and that's where the real problems start?
There's a guy at work who bought a used early 90's BMW 5-series a few years ago. I forget the year or exact model, but I think it's a 5.0 V-12. Anyway, the thing is so complex, that when his battery died, it took him awhile to even get inside the car. You'd think he could just stick his key in the door, open it, pop the hood, and then jump start it, but of course it wasn't that simple. When you put your key in the door lock to unlock it, that was an electronic connection, rather than mechanical, so that died with the battery.
I think he was able to open the trunk with the key though, and there was a connection in there where you could get enough power to it so that you could unlock the doors, to get inside to the hood release.
I guess that does make them harder to steal, but it just sounds like a nightmare waiting to happen. And, the last time I talked to this guy, he was sounding like he wanted to unload this money pit.
You must be thinking of the BMW 750iL - those were the models with the maintenance-intensive V-12 engine.
The locking problem you describe is exactly the type of problem I was trying to solve a few weekends ago. A friend of mine and I were trying to get into his wife's '93 740iL, but the battery was dead and just sticking the key in the lock wouldn't open it.
Was there ever a happy point in time when you could get decent fuel injection but not be bogged down by a bunch of hard to replace electrical compents?
I don't know if there was, because I think both came into play right around the same time. I remember Lemko retired his '88 Park Ave when one of the sensors failed. I can't remember if it was the camshaft or the crankshaft, but it was so buried and hard to get to that it just wasn't worth fixing. Which kinda bothers me, since that's the same basic engine as what's in my 2000 Park Ave! :surprise: I hope it's not a common problem! Or if it is, that it's at least easier to get to on the newer 3.8's.
I've also heard that on some Nissans in the late 80's and early 90's, when the EGR valve went bad, it was a major undertaking to get to.
Yes, EFI and computers go hand-in-hand. The biggest problem with luxury cars is often not the EFI or the engine control, but all the electronic add-ons, as several have mentioned. Seems like MB and BMW jumped into them long before they had all the bugs worked out...
Actually Jaguar is sort of a anomaly here---the older Jaguar XJ6s were so incredibly bad that really, their take-over by Ford was a very good thing. So the more modern a Jaguar you buy, the better off you are. No amount of computer glitches could compare to the trouble you'd have with a 70s--80s XJ6.
It was the camshaft sensor. There are two parts to it: the sensor itself and a magnet that tells the sensor everthing is OK. The magnet came loose thus lighting the CEL. I was afraid the car wouldn't pass inspection with the CEL light illuminated though I knew what the problem was. My mechanic told me that he could fix it, but to do so, he'd have to take the top of the engine off to retrieve and replace the magnet and it would've cost around $1,500 to fix a car I only paid $1,250 or so for. Still, I do miss that car.
There was a guy who had a 1970s XJ6 with a bumper sticker that read "All Parts Falling Off This Car Are of the Finest British Workmanship." Wasn't the XJ6 the car you had to drop the rear end on to change the brakes? I think they also had this odd dual gas tank.
Some of the later ones also could be had with a V12 that could lose oil pressure after a few years, and to put it lightly, were poorly fireproofed.
Indeed, the best thing that ever happened to Jag was being bought by Ford. Without that, they'd be in the same boat as Austin, MG, Wolseley, Riley, Humber, et al.
...is an older Land Rover. I understand some used car dealers refuse to take these in trades, or at least keep them on their lots and send them to auction, as they are so troublesome.
All of them through 2002 are money pits beyond belief, making any German car look very tolerable. The 96-02 models can be very troublesome with air suspension, and are virtually worthless now.
The last time I saw him was about eight months ago and the CRV had 355,000 miles. He only takes it to the store I worked at. Ourside of routine maintenance, he's replaced an A/C compressor and his front calipers. He said it runs the same as when he bought it.
I once took in a 1988 Accord that only our shop worked on with 414,000 miles. Auto trans started slipping so they traded it.
Shifty - what happened with Jaguar is very similar to what happened with Volvo, true? The newer the Volvo, the more reliable and better-constructed it seems to be.
Comments
Yeah let's try to swing back on topic here. Thanks!
As we've noted in this discussion, the depreciation on used luxury cars has accelerated significantly during this recession, especially for those who can pay cash, so it's a great time to buy. What I'm not sure of is the sweet spot for selling or trading the hypothetical 5 year old, 30,000 miles car. I'm thinking that age is less important than mileage, so maybe age can be disregarded, and one should follow shifty's suggestion (if I'm recalling correctly) and bail out at ~80,000 miles. Do I have the sale part about right?
What about doing the necessary maintenance and repairs and going to 150,000-200,000, so you enjoy the full benefit of your expenditures. I mean, why spend the money, only to sell at, say, 110,000-120,000 miles?
Your thoughts?
Replying to an old post, I know, but I had it bookmarked...
I'm not sure how commonplace this situation was back in the "good old days," but today I don't see many used cars for sale, luxury or otherwise, where the owner has just invested a lot of money in repairs. It's usually more like "1998 Luxomobile for parts" or "2001 Cloudmobile transmission needs fixed [sic]."
I can see buying a used car and flushing all the fluids, replacing wiper blades, and changing the timing belt, tensioner, and idlers, where applicable (a grand or so, I'm guessing), but buying something that's not driveable sounds like a losing proposition.
Before letting emotion rule, determine if the first year depreciation and sales tax on a replacement vehicle is more costly than repairing the original. Of course it is, but by how much?
The last half of a car's long life is rarely the best half.
Sounds like the 80s. Advanced engine controls gave stone-age internal combustion engines a new lease on life. For a somewhat shorter life that is.
Fussy electronic controls + bland products of that era = Orphaned 80s cars
My friend's 1998 BMW 750iL is a great case in point: his dashboard has (mostly) gone blank, one rear window doesn't work, he gets constant bulb out warnings, etc. and now water intrusion has ruined some module under the rear seat. Car runs great (or did anyway), looks okay, but it's simply not worth fixing anymore.
too bad...they are *fabulous* cars to drive, when they are running. But even free is too much to spend on one.
My friend's car runs very well. You could even take it on a long trip. But not with a dashboard display, windows or heat/AC.
Was there ever a happy point in time when you could get decent fuel injection but not be bogged down by a bunch of hard to replace electrical compents?
Engineers don't design cars to go 300,000 miles. Some do, no doubt, but most fall apart before that, or get wrecked, or become too expensive to fix, or become impractical for the world they live in (like 10 mpg @ $3.55 a gallon).
I remember one old Benz a 560SEL, that had very high mileage. A friend of mine wanted to buy it. The seller insisted it's been a "great car" and he used it daily.
So I sent the car over to my very trusted friends who repair German cars and, even with cutting corners, they figured it needed about $8000 in critical repairs. This included worn steering parts, bad tires, inoperative electronics of various sorts, leaks, fluid changes, belts, hoses and a timing chain.
Sure the seller got his 250K out of it, but he squeezed it dry like a lemon. The car had nothing left in it but sheer willpower to go another mile.
I know, I know. 90 year old man that plays tennis...
Just a thought, would the C4 Corvette qualify as a Detroit example of "depreciate to (near) zero" technology in the 80s? The cross-fire engine, dig dash, clamshell body structure all seemed to promise that it would never be saved by the hands of car hobby guys in the future.
But like that BMW 750, a good running C4 is a good performance car. Handles like a slot car and the crude overhead valve 350 pulls strong. But when it's over, well, it is over. :sick:
Early '90s Japanese compacts? EFI meant that most of the Rube Goldberg vacuum controls were gone, and the lower and midline cars weren't gadgeted up yet. Plus, any Japanese car from that era worth driving has a colossal aftermarket these days.
Classic case of obsolete technology dragging the car's value to near oblivion.
You remember that pristine C4 that was for sale for $6500 that I posted last year? It's still for sale. He can't get that price.
I went digging and found some odd comps between the un-favorite Corvette and some late 70s Camaros. Realize these are just "asking" prices but still they are posted for similar money, $5k to $6,500.
Here in Ahia:
Decent C4 with working dig dash and nice leather, low miles, automatic, etc.
A bit rusty '79 Camaro for a bit more money?
Even in Washington state:
Really nice looking C4, probably let it go for less than the asking price.
Ratty old Camaro Berlinetta asking a lot for getting so little.
Even though I called the C4 out as a neg example of 80s tech run dry, I'd still buy either of these C4s - or preferably the nice one posted last year - before either of the comp priced F-bodys from the late 70s. At least the Corvettes will GO. For a while anyway! :shades:
You could buy a really nice late 90s Benz E320 for that money.
Still, a jarring sight when ratty malaise F-bodies are offered at prices similar to a decent C4.
Runs great, though, like a freight train, and still handles and brakes very well.
That car was 120K new, albeit 19 years ago, but still. Nice parts car though.
Shifty, and others - I'm really dreading the day when I need to do a $3000+ repair on this car, since it comes from the "new" electronic Volvo era. I don't want the instrument cluster to start randomly reading in Swedish, oil leaking from the tranny, or lighting going haywire. But I guess I'll have to live with it. Advice/tips?
I wonder if most of the people with cars like the 7-Series, Benz S-class, Audi A8, etc, lease them rather than buy, and then just turn them in? Or, even if they do buy, they trade after a couple years?
Then, as used cars, I think they tend to fall into the hands of those that really can't afford them, and that's where the real problems start?
There's a guy at work who bought a used early 90's BMW 5-series a few years ago. I forget the year or exact model, but I think it's a 5.0 V-12. Anyway, the thing is so complex, that when his battery died, it took him awhile to even get inside the car. You'd think he could just stick his key in the door, open it, pop the hood, and then jump start it, but of course it wasn't that simple. When you put your key in the door lock to unlock it, that was an electronic connection, rather than mechanical, so that died with the battery.
I think he was able to open the trunk with the key though, and there was a connection in there where you could get enough power to it so that you could unlock the doors, to get inside to the hood release.
I guess that does make them harder to steal, but it just sounds like a nightmare waiting to happen. And, the last time I talked to this guy, he was sounding like he wanted to unload this money pit.
The locking problem you describe is exactly the type of problem I was trying to solve a few weekends ago. A friend of mine and I were trying to get into his wife's '93 740iL, but the battery was dead and just sticking the key in the lock wouldn't open it.
I don't know if there was, because I think both came into play right around the same time. I remember Lemko retired his '88 Park Ave when one of the sensors failed. I can't remember if it was the camshaft or the crankshaft, but it was so buried and hard to get to that it just wasn't worth fixing. Which kinda bothers me, since that's the same basic engine as what's in my 2000 Park Ave! :surprise: I hope it's not a common problem! Or if it is, that it's at least easier to get to on the newer 3.8's.
I've also heard that on some Nissans in the late 80's and early 90's, when the EGR valve went bad, it was a major undertaking to get to.
Indeed, the best thing that ever happened to Jag was being bought by Ford. Without that, they'd be in the same boat as Austin, MG, Wolseley, Riley, Humber, et al.
The last time I saw him was about eight months ago and the CRV had 355,000 miles. He only takes it to the store I worked at. Ourside of routine maintenance, he's replaced an A/C compressor and his front calipers. He said it runs the same as when he bought it.
I once took in a 1988 Accord that only our shop worked on with 414,000 miles. Auto trans started slipping so they traded it.
We wholesaled them and even then everybody is afraid of them.
NONETHELESS, it does tell you something.