OT Buying a new truck

[Home Guy]

Care to expand on that?

[Doug Miller]

I'll go you one better than that.

I mentioned earlier in this thread the '84 LeSabre that we bought in '91. In the fall of '97 it needed a new battery -- turned out the battery in it was the original. Date code showed it was manufactured in Nov '83.

[HeyBub]

That's you. Many people take their car in to the dealership every 8,000 miles (or whatever) for the factory-recommended "maintenance" once-over (check the oil in the differential, adjust the outside rear-view mirrors, etc.).

Virtually ALL dealerships cover their payroll (plus rent, insurance, utilities, maintenance, taxes, and everything else) from parts and service.

Independent and chain shops cannot do everything a dealership can do. Cars are more reliable than ever before and they have more proprietary parts than ever before, parts and diagnostic equipment that are not readily available to the neighborhood mechanic. I'll wager most independent shops say at least once a day "You'll have to go to the dealership for that..."

[krw]

Jeez, others have explained it already. They make money on the financing. You pay cash (or finance elsewhere - same thing) and they lose that free lunch. You really don't think dealers finance the cars themselves (well, some do but they're more like the rent-to-own types than real dealers)?

[clare]

May as well let it loose 75% of it's value, or more.

[clare]

Used to be - but you can fire a cannon through many dealership service departments today and not hit anything or anyone. 80% absorption today is pretty darn good for an american car dealer. Sadly (for them) you can pretty well fire a cannon through the showroom without hitting anyone too.

Even a lot of 10 or 15 year old cars only need service 3 times a year these days - and very little even then.

Many "chain" shops may post a lower rate - but STILL cost you more over-all than a dealer shop.

And MANY independents can do just about everything the dealers can do (and some even "sub" work for dealers). I know an independent shop did all the alignments for 2 (large) dealerships.

Yes, there are a lot of "dealer only" parts - and SOME diagnostic equipment that independents can't get or afford to have - and SOME of that cannot be worked around.. Some - but very little.

[HeyBub]

That's probably quite true today due to the parlous times in which we live.

Nevertheless, it is still an economic and business goal that the dealership should rely on parts and service to keep the place running.

[HeyBub]

Hmm. I don't think they make (much) money on the financing - I think they sell the paper within 24 hours, maybe for a small profit.

Imagine the overhead - and the risk - necessary to handle the financing for a few hundred sales a year. If I owned the dealership, I'd shed that grief in a heartbeat.

[Doug Miller]

That depends largely on how skilled you are at making your own repairs. I've been doing the vast majority of my own service for 35 years (including engine and transmission rebuilds), so buying older, high-mileage vehicles does not daunt me. The newest used car I've ever bought was five years old; the oldest, nineteen. Average about ten.

With any used vehicle, there's a point where cost of repair has a greater influence on total cost of ownership than does the initial purchase cost. If you have to pay someone else to do your repairs, that point comes earlier in the vehicle's life. For those folks who can't do their own repairs, it's likely to be somewhere around 40-50% depreciation. I'm quite content to buy at

75% depreciation, but then, I pay only the cost of parts for nearly all my repairs.

[Doug Miller]

Wrong. That just means you need to wait longer before you buy.

Let someone *else* pay most of the depreciation.

That doesn't mean it's smart to buy a new one -- it just means that it might be less stupid to buy a new one than a two-year-old one.

So buy a 5 or 6 year old car. So what?

Let someone *else* pay most of the depreciation.

[Doug Miller]

Total cost of ownership is *never* lowest with a new car.

In limited, unusual circumstances, it may be lowER with a new car than with a

1- or 2-year-old used car. But it is never lowEST when buying new. Never.

[chaniarts]

1999: i bought my last car with a credit union loan because it was fast and cheap. that week got a credit card offer in the mail. 0% loan for 12 months, no fee loan transfer. paid off the CU loan that month onto the credit card. didn't pay any interest for a year, paid off the car in that year, so it cost me $0 in interest for a year. 2001: built a new house. paid for all materials for construction on my visa, then gave the bills to the bank to pay off each month. this paid for multiple trips to Europe and the Caribbean and got cash back.

those years are long gone, i'm afraid.

[clare]

Don't I know it. I was service manager for 10 years.

[clare]

For a few years, GMAC made more money for General Motors than the manufacturing/sales division of the company did. Same with Ford Motors Credit Corporation.

Then GM sold off their "cash cow" to Cerberes corp - the same company that bought Chrysler from Daimler before Fiat jumped in.

[clare]

Likewize - but gee, WHAT repairs?? By the time my 6 year old Chysler was 18 years old I had done a valve/guide job, replaced the exhaust, and replaced the transmission, as well as 2 complete sets of brakes.I replaced a few CV joint boots. I think I rebuilt the alternator once, and replaced the timing belt and water pump. That was IT. My 1990 Aerostar had a trans front seal leak,transmission input shaft, U-joints, and ball joints plus one exhaust system and about 4 or 5 sets of front brakes before I sold it at 11 years of age with over

240,000 km on it. (not counting the warranty replacement of the short block because of a piston slap virtually from new) I had bought it from my Dad, who bought it new. My 1996 Mystique had a problem that turned on the check engine light

- bank 1 lean - that I chased for a couple months after I bought it at age 6 years. Replaced intake gaskets and a few other things before I found the defective vacuum hose that collapsed under high vacuum, opening a crack that leaned out the engine. Other than that, A/C reciever, trans oil pan gasket, engine mount, lower strut bushings, brakes and a few electrical contact problems (brake lights 3 times, heater once, right front door window once. Thankfully not much - because it is a real PAIN to work on (2.5 L V6,

4 wheel disc brakes, etc. The antilock brakes/traction control has an issue now - don't think I'll bother fixing it. - and can't forget - the infamous "moosing" problem - solved by drilling a 3/16" hole in a 1/2" copper pipe cap and stuffing it into the hose to the IAC.

The 1995 TransSport was a totally different kettle of fish. You'd think the darn thing was made in England - if you didn't open the hood and fondle it's nuts about every other week it didn't feel good. About the second worst vehicle I ever owned. Ball joints and front wheel bearings lasted about as long as oil filters. CV Joints were not much better. Oxygen sensors should have had wing-nuts on them and the trim quality made my Chryslers look like Rolls Royces.

[clare]

But if you get rid of your cars at about 18 years, depreciation is not an issue. Cost is - initial cost and repair cost - which translates to cost per year.

A new car, bought right, CAN cost less per year over 18 years than the used one, bought at 3 years, over 15 - or sometimes even the used one, bought at 5 years, over 13.

Depends a LOT on how you buy it. (cash or finance - what finance rate, and how good a deal you get - bought private, from dealer, or off used car lot (often the poorest deal)

[krw]

Interestingly, the dealership I was taking my car to, told me to take it somewhere else because they would be too expensive for an exhaust system. They were sure right! [*] So I did, and have been ever since. ;-)

[*] The dealer said the entire exhaust system needed replacing. The place I took it, and have since, replaced everything behind the CC, for about 10% of what the dealer wanted.

[krw]

Except for the "rent-to-own" types, they never carry the paper. Why would they? They *do* get a kickback from the banks, though.

I know places that will carry paper, on (well) used cars. But they usually have their money out of the deal before it rolls off the lot. A manufacturer's dealer? No, they won't carry paper, but they will probably make more money filling out the bank's paperwork than they will selling the car.

[Ed Pawlowski]

wrote

With rare exception, dealers cost more than a good independent shop. I really hate going to a dealer for service and only use them for warranty work or the occasional deal they may offer on oil changes. Of course, once they get you in there they want to sell other services.

As a forinstance: Dealer I bought my last two cars from says you should get the fuel injector cleaning every year @ $129. Two cars would cost me $258 a year. I've never had an injector problem in many years of driving so I'm thousands of dollars ahead of taking their advice.

[aemeijers]

I've never had what I consider to be a good experience with a dealer service department. Multiple do-overs on simple work, wall jobs for recalls, having to leave it all day for stuff other places do while I wait, attempted up-sells, high prices for labor and parts, 'waiting on parts' while they did high-profit jobs instead, and in one case they broke my windshield and denied they did it. And this is multiple dealers in several states over 30+ years.

I avoid them if at ALL possible.