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Discussion Starter · #1 ·
Now that the domestics are successfully closing the gap on quality, as well as on more silly measures like race-car performance, it looks like the next futile argument against the domestics is going to be the old red herring called "resale value". Resale value might have been an important factor in a car-buying decision thirty or forty years ago; but these days, it is in almost all cases just another tired and senseless elitist argument.

Think about it: when you bought your last refridgerator or kitchen table, did you really sit there and wring your hands over the item's resale value? Did you really worry about how much it was going to get for you at the eventual garage sale a few years down the road? Puh-leeez.

A car is no longer a luxury item--it is a commodity not unlike appliances or furniture. If you are a breathing adult, you probably own a car, just as you probably own a refridgerator, a table, and a bed. Resale value makes sense for appreciating investments, not everyday commodities like automobiles.

Sure, it's different if you're talking about the resale potential of an Edsel vs. that of a '57 Bel Air; but the difference in resale value between a Toyota and a Saturn after five years is not only inconsequential, it's also more than made up for by the aggressive discounts that got you into the car, and maybe even the additional aggressive discounts that will get you into your next Saturn.

Ya' think the Toyota is cheaper to maintain? I thought we already went over this... Sure, the Toyota is still less likely to break down than the Saturn; but the likelihood of either one of them breaking down makes that difference unnegligible. Besides, take out the Toyota and substitute a VW or a Nissan, and the typical GM car wins that quality contest.

Ah, what about the difference between more expensive luxury cars--those are not everyday commodities, right?

First of all, if you're choosing a luxury car for its better resale value and you're buying that car at a typical interest rate--as opposed to leasing it or buying the car at near-zero interest--then you're probably not the Wall Street wizard you think you are and it's no wonder you're so obsessed with resale value.

This is important, because--if you take advantage of the generous lease or interest specials offered by the domestics--the average monthly lease payment or zero-interest payment can be hundreds of dollars less per month than the comparable import luxury model, even at comparable sticker prices. Rebates and other up-front discounts have to be factored in as well.

Some may insist that this is not the case--that the imports offer similar incentives which lower the overall cost. This is strange, because these are typically the same folks who complain about lower resale value for domestics because of the aggressive discounts and rebates. So, uh, someone will have to explain that one to me.

Anyway, I obviously voted "no" on this one.
 

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I voted yes but because I buy used. It seems a bit easier to think about what it is going to be worth when you don't lose a few grand right off the bat. If you are smart (and sometimes lucky), you can buy a vehicle drive it for awhile and then get out what you paid. It doesn't always work and I guess isn't really within the bounds you have set, yet I believe it is valid, none the less. I wish I was fortunate enough to get to deal with the ins and outs of purchasing new vehicles regularly.
 

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I voted no, I don't care about resale value; if you like it, buy it! I trade cars frequnt, so mine hold their value some...
 

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In general, I lease, so usually a car with a higher resale value will have a smaller monthly payment.

But if I really like a car, that wouldn't have that big effect on me.
 

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Resale value is a factor, but incentives must also be considered.

If a Camry or Prius is selling at sticker price, and a Cavalier is selling for 4000 dollars off, what idiot would expect the Cavalier to maintain a value close to its sticker price? Edmunds.com probably would, but seriosuly...

You can pay 25K now for the Camry, or 17K now for the rebate reduced Malibu. When you go to sell, sure, the Camry will retain more value because of the Toyota reputation, but it will also maintain it because the car isn't sold with heavy rebates - thus the price remains closer to its original sticker price. People who buy new GM models before they are heavily discounted get stuck badly a year later when that model is offered with 4000 dollar rebates, and 2000 bucks in GM card incentives...

Make sense? I thought so. Now go buy a heavily discounted GM car.

(Never buy one at sticker unless its a special edition Corvette or Monte Carlo or something rare)
 

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The only way to be sure about resale values is to lease your vehicle from the start.

I mean look at what has happened in the last 2 or so years, incentive like 0% as aposed to 7.75% on a late model used, the drop of the US dollar (from here in Canada) means fewer being exported and all of a sudden supplies are increasing.
Recalls like the Ford Explorers, or poor repitations like a Chryslr Neon.

I mean look at the F-150, it's an awesome truck but 3 or 4 years from now WHAT?
or a 2003 Grand Prix now that the 04's are out? Yes staticically Japanesse hold there values a bit better but what's instore for them next, heavy incentives? major recalls? You'll need a crystal ball.

What I do know is that a $43000 dollar truck new last year is worth$27-28000 this year with 12000 miles (retail figures) and thats GM or Ford. Pretty heavy loss untill you figure in incentives and such
 

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Discussion Starter · #7 ·
Originally posted by doh@Nov 21 2003, 01:55 PM
The only way to be sure about resale values is to lease your vehicle from the start.

...

What I do know is that a $43000 dollar truck new last year is worth$27-28000 this year with 12000 miles (retail figures) and thats GM or Ford. Pretty heavy loss untill you figure in incentives and such
Exactly! You've head the nail on the head.

A new car--any new car that most of us here can afford--is a really bad investment, which is why you shouldn't treat it as an investment just like no one in his right mind treats his new TV set or love chair as an investment.

The automotive market is way too competitive to allow resale value to come between a buyer and the new car that manufacturers want to sell him, and it will remain that way indefinitely because the auto business has expanded and matured to the level of any ubiquitous manufactured commodity.

For those who want resale value, get rid of your Corolla or 3-Series or whatever and go buy a Depression-era V16 Cadillac. If you want the best bang for your buck on a new car, go take advantage of the great rebate and finance offers you can get from your local GM dealer and pick up an ION or CTS or one of many other great choices.
 

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I could care less. I will buy a car if I like it without regard to anything else. As long as i've got a grin everytime I drive it, that's all that matters to me.
 
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