Costs of trading 1 yr old car

greenermetals

I have a sister in the north looking advice, she bought a yaris new on finance last may, she has since racked up 20000 miles in 11 months. There was 5 years warantee/100000 miles and 3 yrs free servicing with it. Its going in for its 20000 mile service this sat.

She likes the car and its as dependable as anything on the road.

Car is in for a service this sat in belfast and she and her husband want to talk about getting a new car, perhaps a hybrid or diesel because

a) they are worried about resale value of the car when they keep putting 20000 miles a year up on it
b) the mpg on the yaris isnt that great, averaging around 45mpg (she is the 1.33 petrol)

The diesel Auris will get 60+ mpg but is £90 a year to tax (instead of Yaris' £30 a year, sick i know)

The hybrid will get 74+ mpg and is zero tax pa.

So I suppose the question is, does

depreciation for high mileage+higher running costs < costs of upgrading

they havent been told yet what price differential in traded in car vs upgrade to new car

What does everyone think?

Thanks for any help

Average 45mpg is good, cost to change will look after the first two years of any fuel savings.

greenermetals

how much less do you reckon a three year old yaris with 60 to 70k on it would be worth than one with say 30 to 35?

ottostreet

Just keep the Yaris. Perfectly adequately cheap.

Owen

If she got the Yaris on finance, chances are after a year she hasn't even paid the interest off, and is in negative equity. First thing she needs to do is get the settlement figure on her existing finance, and see how that compares to the value of the vehicle.

Satanta

Okay... to do the math

Based on your figure of 20000 miles per year, here is what the spend would be on petrol per anum (broken down by mpg)

45 mpg: 444 gallons or 2013 Litres @ 1.33 per litre = 2677.29
60 mpg: 333 gallons or 1513 Litres @ 1.33 per litre = 2012.29
74 mpg: 270 gallons or 1227 Litres @ 1.33 per litre = 1631.91

Therefore going from the 45mpg car to the 74 mpg car would save you 1000 per anum on fuel. So you need to find out how much is is to change the car I guess.

BrianD3

45 mpg is not great from a Yaris 1.33, if she gets that from it I don't see her getting 60+ mpg from an Auris diesel. Official figures for both cars are 5.1 litres/100 km for the Yaris and 4.5 litres/100 km for the Auris.

colm_mcm

Bear in mind you're using manufacturers figures. the yaris extra urban figure is 61 mpg.

unkel

Satanta wrote: »

Therefore going from the 45mpg car to the 74 mpg car would save you 1000 per anum on fuel. So you need to find out how much is is to change the car I guess.

At least 4 years worth of fuel savings. To be paid up front. And the interest on the loan on top of that

greenermetals

i think the thing they are most worried about is the depreciation, if at the end of 3 years or so they will actually have anything to sell/ or worth anything with a car that has so many miles on it

Is there any quantitative measure of how much say an extra 10000 pa knocks off the value of a car?

greenermetals

greenermetals wrote: »

i think the thing they are most worried about is the depreciation

So they are going to change it for a new car in an attempt to beat depreciation?

greenermetals

they can get into some sort of thing where the car is changed every 2 years and it has a gauranteed value regardless of mileage, and there is a new model yaris coming out next yr which will effect it also

unkel

RoverJames wrote: »

So they are going to change it for a new car in an attempt to beat depreciation?

LOL yeah

Depreciation on most cars is about 15% in the first minute. Another 10% for the rest of the first year, 15% for the second year, 10% for the third year, etc.

You can only fight depreciation by not buying new cars

Reloc8

greenermetals wrote: »

i think the thing they are most worried about is the depreciation, if at the end of 3 years or so they will actually have anything to sell/ or worth anything with a car that has so many miles on it

Is there any quantitative measure of how much say an extra 10000 pa knocks off the value of a car?

Depend on the car and the purchaser.

Go on the sales websites and search for the car and reg year with x miles, then x plus 10,000 miles, x plus 20,000 etc. - a general review will show you the trend of the effect on asking price.

That's leaving aside market change, depreciation on age, service issues, maintenance etc.

Mr Benevolent

unkel wrote: »

You can only fight depreciation by not buying new cars

But who would subsidize our cars if no-one buys new?

Confab

Confab wrote: »

But who would subsidize our cars if no-one buys new?

Folks will always buy new, it's the way that some of them try and make their purchases to be somehow shrewd is the laughable part.

Satanta

greenermetals wrote: »

they can get into some sort of thing where the car is changed every 2 years and it has a gauranteed value regardless of mileage, and there is a new model yaris coming out next yr which will effect it also

Nonesense. Buying a new car every two years to save money is a load of bollox. My mother in law was going to trade up from a 2 year old Qaskai and it was going to cost her 8K. If you wanted to write off that kind of money every two years on a car you could buy a very good second hand car for that money and just throw it away after the 2 years are up. Sound ridiculous?

greenermetals

i wonder myself is it just wanting a change/new car and them trying to convince themselves that its the smart thing to do.

i think if they can convice themselves that what theyre losing isnt all that much then theyll be prepared to go for it.

Zubeneschamali

greenermetals wrote: »

i wonder myself is it just wanting a change/new car and them trying to convince themselves that its the smart thing to do.

If I had to drive a Yaris, I'd find it very easy to convince myself that any change was a good idea.

greenermetals

8k, theres no way itll cost that, think the market must be different from down here, they are talking the difference of maybe 50 to 80 stg a month on the finance, but theyll have an extra year to pay which they will save on the fuel etc. Those figures havent been confirmed by the dealer yet that seems to be what they reckon itll work out at, thats why i didnt include them

theres no point in getting all excited by the way, was only asking for peoples opinions

Zubeneschamali

greenermetals wrote: »

they are talking the difference of maybe 50 to 80 stg a month on the finance, but theyll have an extra year to pay which they will save on the fuel etc.

The new car will be clocking up the same 20,000 miles, and they'll have exactly the same worry about depreciation next year.