Edmunds dealer partner, Bayway Leasing, is now offering transparent lease deals via these forums. Click here to see the latest vehicles!
Popular New Cars
Popular Used Sedans
Popular Used SUVs
Popular Used Pickup Trucks
Popular Used Hatchbacks
Popular Used Minivans
Popular Used Coupes
Popular Used Wagons
Comments
So if gas sells for $2.40 you could theoretically pay up to $3.12 a gallon for diesel and still break even. That's 72 cents more for the math challenged.
However, diesels sell for more money than a gasoline engine. I'll ballpark the street price diesel premium at $4000.
So using those numbers and the previous posters prices of $2.41 gas and $2.79 diesel and 50k miles per year. Also assume a compact car like a VW Jetta TDI versus a regular Jetta.
50k miles @ 45 mpg (diesel) ==> $3100 per year in diesel
50k miles @ 35 mpg (gas engine) ==> $3443 per year gas
so you save about $343 a year driving the diesel however you paid a $4k premium for the diesel.
So it would take you 11.6 years to break even on your diesel purchase. If you include interest carrying costs of the extra $4k for the diesel engine then if may take 20 years to break even.
If you don't like my assumptions on mileage/diesel engine/fuel costs feel free to use your own and re-run them.
The effect though will be that it's really hard to make a case for a diesel car based on saving dollars.
For what it's worth Hybrid cars have similar economics as diesels in that the economics just don't make sense (or should I say cents).
45 mpg easy in a TDI
35 mpg darn near impossible in the gas version.
On a yearly average, diesel costs a little less than regular unleaded, this past year notwithstanding.
The premium isn't 4000, for the Jettas anyway.
Bottom line - if you drive 50k a year, a TDI is one of the best cars you can buy - and the gas Jetta one of the worst.
According to the vw website the jetta tdi auto gets...35/42mpg with a blazing 100hp. I wonder What a gasoline engine with 100hp would get for MPG??
You forgot >175 lbs-ft of torque (at ~1800 rpm, no less).
You put in a 100 HP engine without that kind of torque in a 3200 lb car, it wouldn't even make it out of the dealer's parking lot.
A main function of purchase tool is to compare different vehicles. Here, the TOC tool is extremely easy to compare among vehicles in the same category. It seems that difference in depreciation cost (market stat) is the most significant, followed by that in fuel cost (EPA rating). Reliability stat is reflected in repair costs. The rest are of much lesser significance.
Now, my questions are:
1. Why 15K miles per year when many insurance co's take an average of 8K miles, and I've read American average about 10K miles? This would significantly affect differences in fuel costs. It would be better to make a calculator to allow users to enter their estimated annual mileage.
2. Why not make a calculator to allow users to enter their perspective "EPP" - estimated purchase price? Unlike the TMV calculated by Edmund.com, which is a national or state-wide average over a fairly long period of time, EPP would reflect opportunity costs associated with the user's local market and timing.
The two calculator suggested here really won't cost much, and they won't skew any other factors that make TCO tool truly valuable. (The annual mileage input can further affect repair cost; and maintenance to a lesser extent.)
Let me explain the second calculator (input box, really) further. The concept of opportunity cost is like the following. In the category of vehicle I'm considering buying, one manufacturer is offering deep discount on a certain model (for whatever reason) in my region yet others in my region stick to their MSRP - or a less competitive discount. The TMV cannot possibly reflect such local and temporal market condition. In other words, my decision window is significantly shorter than TMV's stats window. Let's say TCO of a Toyota model beats a comparable Ford model by $3,000 using TMV as base, but Ford is offering $4,000 discount below TMV. Which model carries a lower TCO for me, who need to make a decision today, in this town, not over a period of six months across the state?
Another possible calculator (input box): financing cost. Nowadays, different manufacturers can roll out different financing incentives for a certain period of time. And this difference is not taken into account in TCO tool. So the buyer would have to figure out if a 0% financing incentive is worth $0.05 per mile fuel cost over 5 years. Such a calculation would be fairly straight forward if user data are allowed in TCO tool.
And what if I usually keep a vehicle for 3 years rather than 5 years?
The point is, temporal and local market fluctuations do not favour averaging methods used in TMV and TCO when used as a purchase tool. Additionally, certain personal usage patterns (annual mileage, total ownership period) can also affect TCO comparison.
My 3 cents.
$650 more to cover alloy wheels and some body trim? It is the same exact car as far as engine/transmission... Those are the variables that insurance companies usually worry about.
regards,
kyfdx
Not the host here
Edmunds Price Checker
Edmunds Lease Calculator
Did you get a good deal? Be sure to come back and share!
Edmunds Moderator
What surprised me was how small the difference was in premiums between the 3 cars we're looking at: Fit Sport, Civic Si, or Element SC. The Si was the most expensive (which I expected), but only about $30/year over the Element and $80/year over the fit.
Is it the end all to researching which vehcile is the best value? No. However it is an excellent resource when combined with other material.
JFKnott
Author of: From Zero to Hero, How to Master the Art of Selling Cars
I invite you to visit our Stories from the Sales Frontlines discussion which you should find interesting and I'm sure you would have some tales to share that other members would love to read!
tidester, host
SUVs and Smart Shopper
We prefer that you don't. Other members will still see it as soliciting and it will get in the way of meaningful dialog.
tidester, host
SUVs and Smart Shopper
I think the "cost of ownership" starts with the initial price of the car. I am ready to buy a new car and I am a bit confused by some of the charges that is in the pricing that a sales has sent me.
It shows the normal price items: vehicle base model, options, destination charge. But then it has some strange items: TDA, Dealer Holdback, Wholesale Financial Reserve.
Can you or someone educate me on what are they?
Thanks.
TDA is the Toyota Dealer Advertising fee which the dealer has to pay to a dealer advertising group.
Read all about Dealer holdback here: here.
Wholesale financial reserve used to be called the "floorplan fee" which is a fee the dealer pays to the manufacturer supposedly to cover the cost of keeping a car in the showroom but for which the dealer gets reimbursed when the car is sold.
tidester, host
SUVs and Smart Shopper
My advice, run, not walk, away from this dealer.
I don't think holdback has anything to do with incentives. It helps the dealer with cash flow, increasing profit and minimizing commissions to salespeople - see the link I provided in my previous message.
tidester, host
SUVs and Smart Shopper
tidester, host
SUVs and Smart Shopper
Perform poorly on any one and the financial consequences can be dire.
It is NOT bottom line profit!
People who are obsessed with holdback should also think about the trememdous OVERHEAD that dealers pay every month just to keep the doors open!
How can the G5 have almost $4000 of repairs and maintenance in just the 4th and 5th years of ownership while still under the 5 year, 100000 mile powertrain warranty and the lifetime or 100000 mile rust thru warranty, and just coming off the (dlr makes everything perfect at the end of the)3 yr bumper to bumper warranty?
So someone paying the sales tax down on a loaded G5 ending up with a 5 year payment of $383 a month must plan on $145 a month additional for repairs and maintenance all thru yrs 4 and 5? Then what? The powertrain warranty ends and the thing starts to really fall apart?
I budget $150-200 a year in maint and repairs for each of my '96, '98, '98, '99 GM and Ford cars and much less for my '01 Chev. That includes tires and oil. I always spend less.
I would really question that item. But I could see tires, brakes, a battery, and maybe one unexpected repair running a grand or more, but that's about it.
Pontiac hasn't run the first TV commercial for the G5 yet and it already has it's 5th year repair bill average calculated.
You may be right in your critique of the TCO on the G5, but if you spent less than $150-200 a year on cars that are from 5 to 12 years old, you have been very lucky. $150 covers what, 4 oil changes and a couple of rotations, and nothing else (trans drain, radiator flush, new wipers, new tires, new battery) - and nothing that ever breaks.
Still, with no customers having had to repair a Cobalt yet, the G5 repair is based on non existing data. All cobalts are still under the 3 year bumper to bumper warranty.
My original, 20 yr old trans fluid in my '87 Astro is still doing fine so why mess with it?
Good point. Transmission oil does not degrade as the coolant does, but I still do drains - not power flushes! - to renew it as per manufacturer manual.
Fallacy no 1: The Honda is $2200 more to buy and is worth $2500 more after 5 years yet costs $348 less over the 5 years to insure. How could the insurance companies not charge as much per insured dollar of car value, making the Honda higher cost to insure?
Fallacy no 2: dividing fuel cost by today's local $2.93 price and dividing 75k mi by the gallons, the avg TCO assumed mileage is 33 mpg for an automatic Civic Coupe and 28 for an automatic G5 Coupe. This 5 mpg difference accounts for 60% of the 5 year TCO difference advantage of the Honda. I currently get 28 mpg average in my '96 Riviera that outweighs G5 by 600 lbs, has 161k miles on it and 225-16-60 tires and a 20 gallon tank. G5 can't beat the Riv with a 4 cyl, narrow tires, and a 13 gal tank? Yet Honda can use a 220 lb lower weight and 400 cc smaller engine advantage over G5 to get 5 mpg more average?
Fallacy no 3: A 3 year old Civic Coupe with 15k mi left on the powertrain warranty and nothing left on the B to B warranty is resellable for $10,822 while a ONE year old G5 with 85k left on the powertrain warranty and only 15k total mi on it is only resellable for $85 more than the 3 year old Civic? What do you get, a k mi of warranty for each dollar more with the G5? So 'I can have one sixth of the warranty for an $85 savings buying the 3 year old Civic' has people jumping? This fallacy accounts for over 50% of the TCO advantage of the Civic.
Fallacy no 4: In year 5, when only the G5 is still under warranty, the G5 maint and repair expenses are $29 per month more than those of the Civic, which is out of warranty and needs a new rubber timing belt (and water pump while your in there), typically to the tune of $7-800?
Summary: Unlike Civic, G5 has a usable back seat and so much more equipment for the price. $15920 will get you ABS, Traction Control, auto trans, 148 HP, 152 ft-lbs T, power surfoof, 7 spkr Pioneer cd, power mirrors, power locks, remote keyless, power windows, DIC with ext. temp, A/C, radio on steer wheel controls, 16" rims, cruise control, tilt, cargo net, and a few more things. Most of this list is not found on a $15920 Civic. The 2991 curb weight is closer to the '04 Accord and not the '04 Sunfire, so don't pass it off as a Sunfire rebadge with all the early '90's baggage that implies for reliability.
The G5 has no track record as it is a "New" Model for Pontiac. Pontiac also has all of the typical GM baggage to overcome. Honda does not have any of those problems.
I liked my old Pontiac and it was a good car but there is a huge perception problem that all the GM brands have to over come. That perception problem was completely justified for all the junk cars they made over the years. They are better now but I don't think they are necessarily equal to Honda in every way.
Also as for your first fallacy insurance companies use a lot more then dollar value to figure out their rates. The programs they use to figure out insurance rates take in hundreds of different variables.
In the 1980's, Honda was producing very good cars but people bought GM cars because they were loyal to that manufacturer.
Now GM and Ford may be making great cars, but many of us have developed loyalty to the Japanese cars and that is what we intend to keep buying. The American manufacturers have lost a whole generation of car buyers.
So would Fallacy over original Fallacy 4 be Fallacy 4² ?
Civic has not had the timing belt since the 2002 Civic Si. It has a timing chain.
It can't cost less than $600/mo realistically for an A4.
The fit is the modern Honda CRX. There is something to be said for the pleasure of driving.
So, maybe not $600/mo., but much closer to $500, in reality, than $299
Edmunds Price Checker
Edmunds Lease Calculator
Did you get a good deal? Be sure to come back and share!
Edmunds Moderator
Also, you could factor in things like gas tank size since a small gas tank makes you fill up more frequently. Might seem nit-picky but we just took a trip to Reno where gas prices varied by nearly one dollar in a span of 100 miles. We saved $15-$20 one one tank because we were able to choose where we filled up since we had a large tank.
Overall I do think that TCO is very useful even if it just points out some hidden costs that one might not think about everyday. For example, my Subaru required nearly $1,500 worth of scheduled tune-ups before 100k, while my new Toyota requires $0 worth of scheduled tune-ups before 100k (tune-ups, not oil changes). That is quite a difference, and now I will always take these factors into account when purchasing.
MODERATOR /ADMINISTRATOR
Need help navigating? [email protected] - or send a private message by clicking on my name.
Share your vehicle reviews
i live in colorado and bought a 2007 used car from a small dealership six months ago. the vehicle was sold to me 'as it is'.
a few days ago i ran into an accident and have had the car worked in body shop. the shop told me that the car was in heavy accident (tell from the condition of interior parts) before i bought it, which i was not informed of by the dealer. I thought i could not argue about it cuz i bought 'as it is'. then i was told that some of the parts were not fixed properly after last accident and might impose some safety issue; and the dealership was not supposed to sell this vehicle to me, or at least should have informed me of that condition.
if the message i received is correct, i might considering to get back to the dealer.
i wonder if anyone has experience of such issue...shed some light on it?
i m totally dummy with the legal system..
appreciate in advance.
Before you contact the dealer, you may want to pull a Carfax report to see if the accident shows up.
Good luck.
You might try to work something out with the seller. If they give no satisfaction, small claims court or the District Attorney's Office would seem a likely next step.
Remember, this legal advice is worth exactly what you paid for it.