Hang on to current vehicle or buy a new one? It's a no-brainer
Over the last 25 years, vehicles have become much more reliable and durable and the average age of the total vehicle fleet in the U.S. is now over 10.6 years. For the cost of one or two car payments a year an older can be kept running well for years. If the car gets 25 miles per gallon, and the car is driven the average 15,000 miles a year, it will only cost $1,800 a year in gas at $3 per gallon. A 35 mpg car will cost $1,290 per year and older cars that get 30+ mpg are not uncommon.
Of course, a 7-10 year old car is unlikely to be as efficient as a new car, especially one with a hybrid or electric powertrain. It certainly won't have technologies like electric power steering, brake energy regeneration or automatic start-stop. An older car really makes the most sense for those people that don't drive much and the energy to produce it has already been expended. The introduction of more expensive, better-equipped smaller cars like the new Ford Fiesta and Chevrolet Cruze will only amplify the new vs. old debate and make it tougher to justify a new car.
[Source: CarCare.org | Image: KB35 - Flickr]
Hanging on to Current Vehicle vs. Buying New is a No-Brainer
Consumers Save Thousands a Year
BETHESDA, Md., July 26 /PRNewswire-USNewswire/ -- With the average cost of a new vehicle creeping closer to $30,000, spending a fraction of that money on making your current vehicle last longer makes good financial sense, reports the Car Care Council. By simply budgeting the equivalent of just one new car payment, consumers could cover an entire year's worth of basic maintenance.
"In the early 1970s you could buy a house for $30,000, and the average vehicle cost $3,900, but they didn't last anywhere near as long as they do today," said Rich White, executive director, Car Care Council.
The average age of passenger vehicles on the road today is 10.6 years, the oldest ever. With proper routine maintenance, the typical vehicle should deliver at least 200,000 miles of safe, dependable, efficient and enjoyable performance, according to the Council. Consumers spend an average of $706 a year on vehicle repair and maintenance, according to IMR Inc.
"Hanging on to your current vehicle allows you to redirect money you would spend on a new car to pay off credit card debt, college loans and other bills or beef up savings or even take a road trip vacation," White said.
The average price of a new vehicle this year increased by $1,057 or 3.7 percent to $29,217, and used car prices rose 5.5 percent, according to Edmunds.com.
The Car Care Council is a national non-profit organization providing information for the "Be Car Care Aware" consumer education campaign that promotes the benefits of regular vehicle care, maintenance and repair. For more information, visit www.carcare.org.
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