Friday, February 08, 2013

Does Blue Book Value Matter?

... if all you want is a comfortable ride that gets you from point A to point B?

My current car is the FredMobile*, a 2001 Nissan Altima. It was never my favorite as it was purchased while I was in extremis. My previous car, a quirky**, gold Nissan Maxima we called the Beach Bomber. We loved that car as it was pleasant to ride in and beaten up enough to not worry about sand on our bodies when we got in after a boogie boarding session. The Beach Bomber got hit while it was parked outside my house and totalled. I didn't have enough money for a good car, so I scoured the used car lots until I found the FredMobile.

Not the FredMobile, but the same year and model. Meh.
The FredMobile is a generic sedan. It's the second most gutless car*** I've ever owned. It's not a thrill to drive, certainly not compared to the DeLorean I used to cruise around in. On the other hand, it's been inexpensive to maintain and right now, all I want is to drive here and there cheaply and reliably while listening to Audible and podcasts. The FredMobile filled that need perfectly until this week.

Recently, the FredMobile has been eating my wallet. It just got out of the shop after I ransomed it for over $2,000. Ouch. My BMW-loving wife, who refers to the FredMobile as a "toad" saw the bill and suggested we pitch the thing over a cliff or sell it, whichever was easiest. It has over 165,000 miles and I'm aiming for 250,000, but she makes the point that the repairs are starting to exceed the Blue Book value, which is about $2500.

Who cares? After the repairs, the thing runs and I trust it. I'm not going to realize anything out of the sale, so why does Blue Book matter? To me, the real question is this: Can I get an equal car for the price of the repair? If the repair is, say, $3,000 and it lasts me 40,000 miles, can I replace the car for that? I think not.

Maybe I've just become sentimental about the FredMobile.

* - Named for the Fred Thompson for President bumpersticker still on the back of it. It just says "Fred 2008." I've got some replacements so when it fades to nothingness, I can still keep the faith. :-)

** - Example: You couldn't unlock the doors with the key. You had to use the keyless entry pad on the driver's door. The control of the door lock solenoids was all wonky and it would relock the door the instant you removed the key.

*** - The most gutless one was my first, a 1969 Dodge Dart with a 225 cu in slant six that would actually decelerate when you floored it. On the plus side, it had bench seats in front which was awesome for make out sessions.


Tim Eisele said...

Yes. The whole problem with ditching a car that costs, say, $3000/year to maintain and buying a $3000 used car is that people don't sell their old cars for no reason. *There's going to be something seriously wrong with that car!* That's way below the price range of the car from the guy who just loves that new-car smell, and sells his perfectly good 2-year-old car to get a new one. Or of the fairly new car from the person who bought a vehicle they couldn't afford, and that got reposessed.

When somebody finally sells off their car for $3000, it's because they've already made that calculation - "Hey, this thing is only worth $3000, and it will cost me that much to fix it! Time to get a new one!" Which means that whoever *buys* it now faces that same $3000 repair job, on top of the $3000 to buy it in the first place.

And even a 2-3 year old car depreciates at something like $3000-$4000/year, which is losing money just as surely as putting that much into repairing your clunker.

Personally, I plan on keeping my '94 Ranger until something really crucial happens, like the frame rusts in half, or the engine leaps in an ugly mass from under the hood, or the transmission eats itself. As long as it costs me less than $3000/year to keep it running, it's cheaper than the likely alternatives. With any luck, I can wring another 8 years out of it, and my oldest daughter can learn to drive it before it finally heads off to the scrapyard after a life well-lived.

Kelly the little black dog said...

The real question is, how long are these $3000 repairs going to last. Once a vehicle starts having costly repairs quite often more are around the corner. It is the dichotomy of throwing good money after bad.

Next time there is a repair, are you going to think, "well I already put in $3000, if i don't fix it again I'm just throwing that money away." It is very easy to throw away a lot of money this way.

My wife had a little grand am when we moved out here. Wasn't a great car, but got amazing milage and was reasonably fun to drive. The last time we took it in for repairs, the shop tech mentioned it was going to be a money hole. When I really looked at it, the repair costs were going to be comparable to the payments for a new car, with the added benefit of having a newer safer vehicle.

Kelly the little black dog said...

Tim, I have to disagree. I've had many used cars and most were cheap because they had cosmetic issues. I drove most of them into the ground. And I regret that I didn't get rid of some of them earlier because I sinking 2/3rds of a car payment into them. Then there is the option of getting a lightly used car such as a lease return.

It really depends on what kind of driving you plan to do, and the future reliability of the car. Driving around the neighborhood is very different from daily freeway commuting.

Mostly Nothing said...

I had a 98 Altima. I liked it ok. It was the wife's car for a few years, then we got her the new Mazda 6 wagon. I drove it for a couple years, until a cell phone driving a Blazer totaled it.
Then got the '99 Subaru. I never really liked the car. It's loud and not very comforatable for me, and doesn't get very good gas milage. On the other hand, it's paid for, and hasn't cost a lot in repairs. $3000 three years ago, a couple sets of tires, and then $900 two weeks ago to fix completely failed brakes. I should have fixed them in the fall for a quarter of that, but life happened and I forgot. It's my son's car now, he loves it. In the winter, I love the car, it goes through anything, and with the cities plowing less, its nice to have. Gives my wife a little less to worry about for the boy's 14 mile drive to school.
My current '06 Altima is pretty nice. Got it used, it's big selling point is the big back seat for the basketball player. Of the 4 cars, it has the least milage at 90k. I think the Subaru has past the MG now.
The goal is > 186k, that our old 626 got. It weezed its way to the dealer the 6 wagon.

A friend has an '01 3-series all wheel drive. It costs him a lot more every year than any of my cars.

It's a different world up here in Minnesota than So Cal. Cars will not last as long. A little dull isn't a bad thing.