Posted by: Jack | May 16, 2008

Revert to an Adolescent State?

You may be aware that I’m in the market for a replacement for my Subaru Impreza WRX. It’s almost an all-around great vehicle, save for it’s fuel efficiency. From an environmental view-point, Subaru has assurred me that their zero-emission vehicle production facilities make the lifetime ‘foot-print’ of the car far better than most despite it’s non-competitive rate of consumption. So I can’t quite justify a replacement for the sake of the environment alone.

So how about that other factor that occasionally plays a part in decision making; money? Every time I fill my tank these days — which due to an increase in biking, is actually quite a rare occurrance — it runs me about $50. In seeking a replacement which represents a wise financial move, a number of factors have to be taken into account (that number being 5):

  1. Fuel-efficiency of the replacement vehicle
  2. Cost of fuel in the next x years
  3. Amount of driving I’m likely to do in the next x years
  4. Cost of the replacement vehicle
  5. Resale value of my current vehicle

If I keep my car and drive 10,000 miles/year for the next five years (probably will be far less but I’m biased towards whatever results will leave me more inclined to get a different car). With a current mpg of about 22, that represents a fuel cost — making a terrible assumption of $4/gal — of ~$9000 (that sucks).

If, however, I swap out for a Prius (don’t really want one of those but it’s got the highest fuel-efficiency on the market right now) I’m looking at 45 mpg, a net loss of nearly $9000 on the selling/buying of vehicles plus a $4,500 fuel bill. Pretty easy to see this doesn’t work out so well.

But — getting back to the title of this post — in my highschool years I drove a VW Jetta III which at the time left me convinced that I would drive VW for life. Obviously that conviction didn’t stick. But just this morning I saw that the 2009 Jetta TDi is coming to the states with an emissions rating that meets the world’s strictest regulations, a price tag about $5k less than the prius and a fuel-efficiency of ~55 mpg. Also, it’s not a Prius.

So, recalculating: 55 mpg, ~$3,500 loss in selling/buying, fuel bill of ~$4,000 (price adjusted for higher rate of diesel).

To summarize, keeping my car will cost me $9,000 in the next five years (regarding just the factors mentioned above). Switching to a new Prius (ugh) will cost me $13,500. Switching to a new Jetta will cost $7,500. Sounds good to me!

But wait, there’s more! Right now I pay way too much for car insurance despite hardly driving at all. The primary reason for that is the type of car I’m driving. Migrating to the Jetta is likely to cut that bill down by 30-40%, taking at least another $1000 off that five year projection.

All of this will be disregarded by the time 2009 rolls around, hopefully due to an ever increasing selection of higher-efficiency vehicles that don’t look stupid.

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