Tesla Is Changing the Used Car Game(capitalone.com)
capitalone.com
Tesla Is Changing the Used Car Game
https://www.capitalone.com/cars/learn/finding-the-right-car/the-tesla-effect-how-tesla-is-changing-the-used-car-game/1096
46 comments
Even when the parts are reliable and not oddball, they still cost more.
You can pay $25k for a used car that cost $50k when it was new, but you will still have the maintenance and repair bills befitting a $50k car. The original owners could afford that cost of ownership, and the manufacturer took that into account when it designed the car.
I know a few people who buy older Mercedes and BMW models and they say the cost of ownership is low, but that's only because they do their own work and don't need to pay a mechanic.
You can pay $25k for a used car that cost $50k when it was new, but you will still have the maintenance and repair bills befitting a $50k car. The original owners could afford that cost of ownership, and the manufacturer took that into account when it designed the car.
I know a few people who buy older Mercedes and BMW models and they say the cost of ownership is low, but that's only because they do their own work and don't need to pay a mechanic.
There's a good middle ground solution to use an independent brand (or multi-brand) specialist mechanic. Several BMW or MB independents in most major cities/suburbs thereof and they're often quite a bit cheaper than the dealers.
I had excellent service from the one MB I owned (granted I did turn all the wrenches on it, so the costs were extremely low). One nice thing about the luxury German cars is that they are generally designed for a long service life. Things that need to come apart for servicing are generally threaded fittings (rather than push/snap fit plastic crap).
I had excellent service from the one MB I owned (granted I did turn all the wrenches on it, so the costs were extremely low). One nice thing about the luxury German cars is that they are generally designed for a long service life. Things that need to come apart for servicing are generally threaded fittings (rather than push/snap fit plastic crap).
Agreed. Have a 2010 and 2015 Porsche both out of warranty. Use a local shop that is focused on Porsche (BRRacing). Not cheap but not outrageous. Lucky besides breaks and tires the 2010 has had no major issues. I am religious about having it serviced, however. I did have a pump got out, it was like 800 installed.
I had an Audi. To do the timing belt and water pump change myself cost $400 in parts and a full day. To have an independent shop do it was asking $900. Audi dealer was asking $1500.
I drive a Ford now.
I drive a Ford now.
The timing belt on a $20,000 Volkswagen would have cost exactly the same.
Not to say that Volkswagen is the champion of reliable economy cars as they’re not, but, plenty of other cars have timing belts.
Not to say that Volkswagen is the champion of reliable economy cars as they’re not, but, plenty of other cars have timing belts.
No the VW was more because the engines are transverse in those cars. But the parts are shipped from Europe and the labor is up charged because foreign car. Thanks to Denso, a lot of these parts are cheaper today but labor is still stupid.
Also Audi/VW had a stupid tensioner design which made timing belt replacements a requirement at 30k miles until they changed it. I think this is still a grand example of how luxury brands up charge everything because luxury. It costs 450 for the dealer to do the same job on my transverse Ford engine.
Also Audi/VW had a stupid tensioner design which made timing belt replacements a requirement at 30k miles until they changed it. I think this is still a grand example of how luxury brands up charge everything because luxury. It costs 450 for the dealer to do the same job on my transverse Ford engine.
Not in my personal (anecdotal) experience. I bought a $65k MSRP Audi S4 for $31.5+tax, 4 years after it hit the market.
Haven't had anything go wrong in the 2 years I've owned it, just regular maintenance that I go to an independent mechanic for.
I find if you follow a few basic principles of used luxury car buying you can avoid a ton of headaches...
- Stalk forums for the model that you want and understand all the serious problems certain model years can have. Avoid those model years, always buy the latest model year of that series (Most issues get solved by the manufacturer).
- Do a PPI (Pre-purchase inspection), it's only ~$100.
- Ask for previous maintenance records / repairs (Avoid cars with accidents or questionable titles).
- Do preventative maintenance and never miss a scheduled service.
- Fix problems immediately as they arise, don't let them get worse.
So far I've owned a fantastic sports sedan that I've wanted to own for a long time, for 50% off.
Haven't had anything go wrong in the 2 years I've owned it, just regular maintenance that I go to an independent mechanic for.
I find if you follow a few basic principles of used luxury car buying you can avoid a ton of headaches...
- Stalk forums for the model that you want and understand all the serious problems certain model years can have. Avoid those model years, always buy the latest model year of that series (Most issues get solved by the manufacturer).
- Do a PPI (Pre-purchase inspection), it's only ~$100.
- Ask for previous maintenance records / repairs (Avoid cars with accidents or questionable titles).
- Do preventative maintenance and never miss a scheduled service.
- Fix problems immediately as they arise, don't let them get worse.
So far I've owned a fantastic sports sedan that I've wanted to own for a long time, for 50% off.
Audis, especially Quattros, are an expensive nuisance to maintain.
The first step of anything to do with the engine compartment is "remove front of car".
They don't optimize the layout one bit for minimizing cost/maximizing ease of maintenance. I have a friend with an RS6 that sat unused for years because it needed some cam sensor or actuator thingy serviced to idle right and pass smog, to do the job required pulling the engine due to packaging constraints. A job like that isn't just expensive, it requires finding a mechanic you actually trust to do the invasive job properly, unless you can DIY.
I'm a DIY type, and that has me firmly in the domain of mass-produced Japanese economy-sports cars. They're an absolute dream to work on. I can change the timing belt on my current car without even jacking it up off the ground let alone tearing the front of the car off, using nothing but a few hand tools.
The first step of anything to do with the engine compartment is "remove front of car".
They don't optimize the layout one bit for minimizing cost/maximizing ease of maintenance. I have a friend with an RS6 that sat unused for years because it needed some cam sensor or actuator thingy serviced to idle right and pass smog, to do the job required pulling the engine due to packaging constraints. A job like that isn't just expensive, it requires finding a mechanic you actually trust to do the invasive job properly, unless you can DIY.
I'm a DIY type, and that has me firmly in the domain of mass-produced Japanese economy-sports cars. They're an absolute dream to work on. I can change the timing belt on my current car without even jacking it up off the ground let alone tearing the front of the car off, using nothing but a few hand tools.
Yeah I definitely agree with you there. You're referring to the "service position", which requires removing the front bumper.
They do it to discourage DIY type of work, can't say I'm a fan.
They do it to discourage DIY type of work, can't say I'm a fan.
Wait until you have to replace the transmission or something else that’s common in the first 10 years. $10 for an s4 transmission is way more than for a Toyota.
I've worked on cars and tractors for ages (even though I never got one myself, cars are boring, bikes are better) and have never had to replace a transmission. Clutch plates, yes. Crankshaft, yes. Pistons, cylinder heads, valves, cylinder linings, bearings, the works. Transmissions? Nope. Might this be one of the bigger advantages of manual transmissions which still are the norm (and probably will remain so for the remaining lifetime of internal combustion engines) in north-western Europe? Apart from synchromesh rings there are no real wearable parts in a manual transmission.
Why are you specifically mentioning north west of Europe? No one I ever met in south east of Europe ever had automatic (where I live).
Because that is where I live and have data on? Because I think I should not make statements about the rest of the continent when I can not be sure that what I say actually is correct?
lol.. all transmissions are pricey and basically a transmission should last for at least 200k.. Basically when the tranny goes you are done. If a brand has bad trannys people find out about it and don't buy their vehicles... including new ones. This is why you see 60k power train warranties etc...
Parts are shared across vehicle lines and sometimes across manufacturers.
Luxury manufacturers also have invested heavily in the certified pre-owned market which means that to save money they make the cars better initially. Why? Otherwise they have to pay the dealer for the work to repair. Cars are so reliable that even dealers will warranty the power train on a used car for 100k miles for no additional cost (even after negotiating the sale price). That's how confident they are. If you are really worried buy the used luxury car from carmax and purchase the extended warranty.
Parts are shared across vehicle lines and sometimes across manufacturers.
Luxury manufacturers also have invested heavily in the certified pre-owned market which means that to save money they make the cars better initially. Why? Otherwise they have to pay the dealer for the work to repair. Cars are so reliable that even dealers will warranty the power train on a used car for 100k miles for no additional cost (even after negotiating the sale price). That's how confident they are. If you are really worried buy the used luxury car from carmax and purchase the extended warranty.
All should last, Audis are notorious for both sucking and breaking and being extra expensive. I had an a3 for a while and had the transmission replaced three times in 140k miles. The first was under warranty, the other two were $8k. Transmission on my corolla was $3k.
Consumer reports publishes repair costs. Audis are much more than Honda/Toyota/Hyundai.
You can purchase an extended warranty for your Audi, it will cost 3x what it would cost on a Lexus or Toyota.
It’s a fun car to drive, but it costs much more to maintain.
Consumer reports publishes repair costs. Audis are much more than Honda/Toyota/Hyundai.
You can purchase an extended warranty for your Audi, it will cost 3x what it would cost on a Lexus or Toyota.
It’s a fun car to drive, but it costs much more to maintain.
That's one reason why I never go for base models or cheap luxury cars. The 2.0T is a notoriously bad engine, I would have gotten the A4 but wanted the reliability of the 3.0T V6 and so far, I've gotten it.
Again, you have to read, pick and choose the right model. Audi makes a lot of unreliable crap (Or at least used to a lot, in the past) so you need to weed it out.
Again, you have to read, pick and choose the right model. Audi makes a lot of unreliable crap (Or at least used to a lot, in the past) so you need to weed it out.
I think you're referring to the mechatronics unit that was prone to failure in the B8 series model. Luckily, I bought a B8.5 so that is no longer an issue, as it was fixed.
I'm not planning to replace the transmission on this car, I will most likely sell it in a few years.
I'm not planning to replace the transmission on this car, I will most likely sell it in a few years.
Your Audi went from $65,000.00 to $31.50? That's a huge value hit.
Consistency matters.
Consistency matters.
I enjoy camping and hunting and tend to purchase SUV's and trucks that can get to remote areas. I tend to buy them in the low years (10-15) years old and restore them overtime ( another hobby of mine) as they always seem to pop up in price and become a good investment at about 20-25 years.
Anyways, one time I came across a deal on a Land Rover Defender and picked it up. It was the worst decision in my car buying life. Oddball parts, expensive, being broke down waiting on parts to ship from England, where all regular occurrences. I am sure, I put over 10K in replacement parts into that vehicle and those where the ones that actually broke and not parts purchased for restoration.
After that experience I came across a Lamborghini LM002 at a really good price, IIRC it was around 25K when no one wanted the Rambo Lambo and passed on it, looking at the prices now, I kick myself for not getting that one. Though it would have been another nightmare.
Point being I agree stay away from used luxury cars but if that is what you want, it's better to buy used, than new and then have to still foot the bill when the warranty is up.
Anyways, one time I came across a deal on a Land Rover Defender and picked it up. It was the worst decision in my car buying life. Oddball parts, expensive, being broke down waiting on parts to ship from England, where all regular occurrences. I am sure, I put over 10K in replacement parts into that vehicle and those where the ones that actually broke and not parts purchased for restoration.
After that experience I came across a Lamborghini LM002 at a really good price, IIRC it was around 25K when no one wanted the Rambo Lambo and passed on it, looking at the prices now, I kick myself for not getting that one. Though it would have been another nightmare.
Point being I agree stay away from used luxury cars but if that is what you want, it's better to buy used, than new and then have to still foot the bill when the warranty is up.
That's why you see that $20k 7-series with 90,000 miles on it but it's only 4 years old on so many car lots. That thing looks like a deal but it's one failure away from $15k in dealership repairs
But a good deal if you can fix stuff yourself.
Isn’t it that the parts are really expensive, not the cost of work?
At least that’s my observation. They wanted $1300 for a headlight on my 2007 BMW, that cost maybe $8000.
Cost of work to replace it was like $30-40.
At least that’s my observation. They wanted $1300 for a headlight on my 2007 BMW, that cost maybe $8000.
Cost of work to replace it was like $30-40.
New, oem it could be about $1300 for the whole headlamp assembly. But used from salvage, about $250-350. Which is a no brainer. No need to put a brand new headlamp in a used car.
How long do you wait for the bumper fender fix of any Tesla model again?
3 months maybe, 6 months definitely.
That is only true for some model S and model X parts due to low production volume and large number of oddball parts. Model 3, which is by far the most numerous Tesla, is far more repairable. I've had computer unit and front axle undercarriage panel installed same day.
Why are manufacturers increasing income for the repairmen instead of lowering the cost of maintenance so that they can increase their own prices? Is this because they couldn't increase prices even if they lowered maintenance cost so they leech of repair shops?
I think it’s more of a price insensitivity thing. I’m loosely basing this on luxury car owners I’ve known and what I’ve heard about BMWs specifically. Basically BMWs tend to be designed to be great for the first 16k miles or so then fall apart. They use parts that are in hard places to service and that break around that point. It sounds like they are meant for people who will be onto the next car at that point. Probably sounds like a ridiculous market segment, but there really are people who have enough money to not care about dropping 100k on a car once or twice per year. Mercedes have a similar viewpoint on their customers - they “can afford more expensive maintenance.” Something not dissimilar from smartphones being replaced because their batteries being at end of use.
Eh. Yes. Maintenance on MB, BMW, Porsche has always been higher. The comment about the parts I do not understand at all. A part for a 2010+ car from these lines are not odd nor hard to find, they just cost more.
This is exactly what I fear with a used Merc even though I want one so bad. Will a Tesla have a significant yearly cost?
What a croc of an article.
> a 2018 BMW 320i lost nearly 20% of its value, dropping from $37,700 to $30,700.* While it’s true that newer vehicles typically depreciate at a steeper rate, it’s not usually that steep.
Note how they don't give a source for the claim it's not usually that steep?
Here's people talking about E-Classes losing 55% of their value in 3 years... 7 years ago: https://forums.mbclub.co.uk/threads/depreciation.124585/
If anything their example is actually less depreciation than I'd expect for a 3 series based on trends from years ago . Probably because the 320i is the base engine (non-M cars don't end up retaining that much more value as engine sizes go up). I've seen brand new 1 year old non-M BMWs for more than 25% below MSRP sitting on the lot.
>At three years old, a 2016 Mercedes B-Class would ordinarily depreciate at a slower rate. For the same time period as the BMW above, though, the B-Class dropped from $18,500 to $13,250, nearly 30%.*
Do yourself a favor and google a 2016 B-class (if you don't want to bother, it's a hideous minivan that any US readers have a fair chance of probably never having seen in real life). Even amongst Mercedes's lineup it's a car that rapidly depreciates "above it's weight class".
And the 2016 B Class is now a generation behind, and from the tail end of 7 years without an update. They actually stopped selling here in the US, and in the last year they existed on our shores they sold... less than 200 units.
The lesson here is people who can afford a German luxury car aren't trying to get a hand-me-down luxury car. People who can afford one, and are frugal, are probably buying a Japanese one over a hand-me-down German one.
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Well that and CapitalOne really wants eyeballs with that clickbait title.
Anyone else notice the text trying to get you to use their loan program to buy a car loads, then a loading bar shows up before the actual article does?
> a 2018 BMW 320i lost nearly 20% of its value, dropping from $37,700 to $30,700.* While it’s true that newer vehicles typically depreciate at a steeper rate, it’s not usually that steep.
Note how they don't give a source for the claim it's not usually that steep?
Here's people talking about E-Classes losing 55% of their value in 3 years... 7 years ago: https://forums.mbclub.co.uk/threads/depreciation.124585/
If anything their example is actually less depreciation than I'd expect for a 3 series based on trends from years ago . Probably because the 320i is the base engine (non-M cars don't end up retaining that much more value as engine sizes go up). I've seen brand new 1 year old non-M BMWs for more than 25% below MSRP sitting on the lot.
>At three years old, a 2016 Mercedes B-Class would ordinarily depreciate at a slower rate. For the same time period as the BMW above, though, the B-Class dropped from $18,500 to $13,250, nearly 30%.*
Do yourself a favor and google a 2016 B-class (if you don't want to bother, it's a hideous minivan that any US readers have a fair chance of probably never having seen in real life). Even amongst Mercedes's lineup it's a car that rapidly depreciates "above it's weight class".
And the 2016 B Class is now a generation behind, and from the tail end of 7 years without an update. They actually stopped selling here in the US, and in the last year they existed on our shores they sold... less than 200 units.
The lesson here is people who can afford a German luxury car aren't trying to get a hand-me-down luxury car. People who can afford one, and are frugal, are probably buying a Japanese one over a hand-me-down German one.
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Well that and CapitalOne really wants eyeballs with that clickbait title.
Anyone else notice the text trying to get you to use their loan program to buy a car loads, then a loading bar shows up before the actual article does?
The article says used luxury car prices are plummeting because so many ice luxury owners have been switching to a Tesla.
Something similar is going to be happening to the rest of the used car market pretty soon. There are a ton of low and mid-range price ev's coming out from many manufacturers in the next few years. That plus expanding charging networks plus increased government incentives mean that many of millions of ice owners will switch to bev's, and that in turn will cause the ice used car market to crash.
Does any one want to disagree? Does anyone want to argue that 10 or 20 years from now ice sales will be doing pretty much the same as they are today?
Something similar is going to be happening to the rest of the used car market pretty soon. There are a ton of low and mid-range price ev's coming out from many manufacturers in the next few years. That plus expanding charging networks plus increased government incentives mean that many of millions of ice owners will switch to bev's, and that in turn will cause the ice used car market to crash.
Does any one want to disagree? Does anyone want to argue that 10 or 20 years from now ice sales will be doing pretty much the same as they are today?
> on the pre-owned luxury car market
I was expecting to see something about Tesla’s lease or buyback program with their “resale value guarantee” which I always found interesting and AFAIK not offered by any other manufacturers.
I was expecting to see something about Tesla’s lease or buyback program with their “resale value guarantee” which I always found interesting and AFAIK not offered by any other manufacturers.
No longer offered. It screwed up Tesla’s accounting, but was necessary because at one point Tesla couldn’t offer leasing. So they passed the risk of Tesla bankruptcy onto the customer.
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"pre owned" = pretentious euphemism for "used"
Here's a CleanTechnica article on the topic
https://cleantechnica.com/2019/10/06/just-as-expected-luxury...
Used luxury car is a quick way to lose money.
The spare parts are rare and expensive in most times
and lack of supply make you get stuck many times until the car get fixed
The spare parts are rare and expensive in most times
and lack of supply make you get stuck many times until the car get fixed
You must be talking about ultra luxury or something? Because the online aftermarket for BMW and Mercedes autoparts quite large.
Sure, more expensive than standard cars, but I have never heard of anyone not able to find a part immediately available.
Sure, more expensive than standard cars, but I have never heard of anyone not able to find a part immediately available.
Get a Lexus and have it service at Toyota. Done.
But no free breakfast and no free rental car!!!
Here's the story:
Tesla circumvents some dinosaur regulations
It suddenly makes sense
Chrysler pays $TSLAQ to whine about it
Everyone realizes it works really well
Repeat ad vomitum.
Tesla circumvents some dinosaur regulations
It suddenly makes sense
Chrysler pays $TSLAQ to whine about it
Everyone realizes it works really well
Repeat ad vomitum.
As the info of any issue of the car could be known does it help to evaluate the car value?
They tend to use oddball parts that are more expensive to get, more onerous to install, and often less reliable overall. Value cars get their reputation from more than just the initial sale price.