In the late ‘90s, a popular consumer magazine claimed a certain SUV rolled over easily. This study was strongly debated; I doubt anyone remembers who was right. But the damage was done. The vehicle fell out of favor into the one-way pit of corporate neglect. As the dust settled, I purchased a used example of this otherwise reliable, well-built machine at an exceptionally low price. After five virtually trouble-free years, I’ve decided to replace my ‘98 Isuzu Trooper with something newer. And so begins my hunt for undervalued quality.
The contrarian investor buys stocks that are cheap and currently out of favor. He seeks shares whose price has been depressed by bad news or a temporary setback, which otherwise represent sound investments. These principles apply perfectly to the art of buying a used car. For those willing to venture outside of the Honda-Toyota mix of political correctness, amazing values await.
A contrarian buys quality. These days even so-called second-rate automobiles may possess excellent quality. If you can stomach the fact that your car is not quite the class leader (whatever that is) and resist the social pressures to “buy the best” (whatever that is), you can save an enormous amount of money on a used car, and not lose much of it later.
After considerable contemplation, I’ve concluded that the sweet spot for American automotive value is currently $16k. For sixteen Grover Clevelands, you can purchase a wide variety of gently used 2006 models, still under warranty and mechanically fresh. While we’re not talking about budget boxes here, it is true that 16 large won’t buy you a lot of what I call automotive fluff: leather and fancy electronics. Pay less and you’re looking at too much compromise (tinny doors are endlessly annoying).
Sixteen thousand it is. So what’s out there for contrarian car buyers?
Let’s start by eliminating the obvious. Hondas and Toyotas are immediately disqualified. We’re looking for a vehicle that’s suffered the slings and arrows of outrageous depreciation. Toyondas just plain don’t. Again, we also want quality, so Volkswagen drops entirely from our list. Unfair? Possibly, but both J.D. Power’s mob and anecdotal evidence suggest that VW quality’s leaves everything to be desired. And out goes VeeDubs’s familial relation, Audi.
In this pursuit, domestics rule. FoMoCo has plenty to offer the curious contrarian. A quick internet search unearths a fleet of sub-$16k 2006 Ford Fusions, a textbook casualty of the Detroit resale curse. The Fusion score high marks for drivability and reliability, yet sells for the same price as an econobox on the used market. As do the Five Hundred/Freestyle, which should take an even bigger hit when Ford re-renames them the Taurus/Taurus X.
In fact, just about any Ford product holstering the Duratec 3.0-liter engine qualifies as a suitable candidate. Mazdas equipped with ye olde six, the MPV and Mazda6 S wagon (not the sedan or the hatch), are decent, second-tier cars that sell for peanuts on the used car market. Pistonheads note: the Mazda6 S is a particularly attractive (i.e. unloved) stealth wagon.
One can’t talk about cheap— I mean, undervalued cars– without taking a good hard look at Chrysler cast-offs. Amateur CSI’s will find plenty of dried contrarian drool on used Town and Country minivans with three to ten thousands miles, selling for the magic one six.
The Magnum, Dodge’s chop top load lugger, rocks; or, I should say, sinks like a rock. With a little digging, you can find a well-loved 2006 Magnum SXT that listed for $26K selling for $16K.
Chrysler’s proto-CUV, the Pacifica, can also slip into our price range. And while the anti-green hedonist inside me craves a stripped 2006 Grand Cherokee or Commander, they fall just north of our self-imposed budget. Damn.
For the ultimate target-rich environment, type Saturn in the Search box. You can buy a used Ion for about the same price as a good washer and dryer set. I am especially impressed with the Ion Red Line— an imperfect sports car for sure, but redeemable at the right price.
And for the really daring contrarian, take a look at the crop of domestic minivans on their final death march. The Ford Freestar and Chevy Uplander may be hideous, but the discrepancy between msrp and what’s it gonna cost me is staggering.
The old adage says that a fool and his money are soon parted. If only it were that simple. A proud Camcord buyer easily pays $21k or more for a brand new model, replacing it every few years.
But the contrarian, with the clarity of an economist, pays $16k for a gently used Fusion or the like with a similar feature set. And then banks a $5,000 buffer to cover any (real or perceived) differences in reliability. Just who is the fool now?
2002 – 2004 Mitsubishi Diamante VRX. Unloved, dead, Reasonably well built, full of psuedo luxury, reasonably fuel efficient, and more fun to drive than a CamCorDima (once you accept the torque steer).
Go to Autotrader.com or any other used auto website – look up a 2006 Mercury Grand Marquis LS – you can find them with around 20,000 miles and priced $16-17k. The LS comes with leather, autotemp control, traction control, antilock brakes, etc.
And, it is a car designed to last a long time, unlike a Mexican built Fusion, or a Five Hundred with a questionable CVT transmission.
One can tow a camper and haul a kayak at the same time with a Grand Marquis – and do so for many a year into the future.
“The old adage says that a fool and his money are soon parted. If only it were that simple. A proud Camcord buyer easily pays $21k or more for a brand new model, replacing it every few years.
But the contrarian, with the clarity of an economist, pays $16k for a gently used Fusion or the like with a similar feature set. And then banks a $5,000 buffer to cover any (real or perceived) differences in reliability. Just who is the fool now?”
Your argument would have merit, except everybody, and I do mean everybody, who I know that has a Toyota or Honda are getting all the mileage out of the vehicle that they can. Most have older versions with over 200k miles on them and when the time comes for them to kick the bucket, they buy a new version of what they had. They buy them so that they don’t have to take them into the shop (except for scheduled maintenance) and so they don’t have to get a newer one every few years. As always, YMMV.
Nice piece. I only wish it was out a year ago when I needed to buy a new (used) car.
In the future, what’s the best way to wade through all the information and find the sleeper models?
thanks
M
Saab 9.2X by Subaru.
-Extended GM Warranty
-Subaru Quality
-All wheel drive!
Whooda thunk it? I’m a contrarian. Is that a good thing? This was me in the late 90’s when I was buying used ’92-’95 Tauruses for me and mine. Not as nice or as trouble free as a Camry, but a hell of a lot cheaper, comfortable…in a word – adequate.
Where I am at you can get a 2006 Hyundai Sonata with the V-6, moonroof, and 12k miles for $14-15. Perfectly adequate, reliable transportation.
A new Buick Lucerne CX at $26K, no thanks. But for $16K for a detailed rental return, it’s way more car than a Camcord.
Where’d you get that picture of the Trooper? It looks like a Japanese-market model, with right-hand drive and that whacky extra rearview mirror on the fender. But it has Massachusetts plates! Is that a photoshop job?
Gonna go with Taxman on this one. Surpised that you did not mention anything about the GM’s or Crown Vics, but I guess that they have probably fallen out of favor with the current fashion crowd.
To hell with the $16K – you can buy a low-mileage 2002 and up for a song. There’s a reason that the cops and the cab companies love em – they are cheap-2-keep. Parts interchange between years, they are easy to fix, and they last. Mileage is an average 18-24, city – highway, not bad for a big car.
A true contrarian buys an Aztec. Reliable, decently powered and very inexpensive suv.
I am not a true contrarian.
If your budget exceeds $16K, you can still save serious money without limiting your search to the big 2.5. Seller motivation provides some attractive buying opportunities. I bought a BMW 330ci (19K miles and one year old) from an individual who decided he just had to have an M3. My discount from new: $12,000. I estimate that my cost of ownership (depreciation and cost of money) after 5 years will have been $275 monthly. These situations are fairly common.
Come to think of it, that would bring my cost to $16,500.
I do like the Crown Vic/Grand Marquis, however, it would be weird to drive given that I am under 70 and employed in the private sector. Ha ha. Just kidding. There are tons more options to mention….
I can’t believe I forgot to mention the Pontiac Grand Prix. Talk about missing the obvious!!
A reasonable strategy as long as one is planning on flogging the living daylights out of the vehicle and essentially expect to sell it for $1800 on Craigslist in 8 years. If your plan on ownership is more in the 3 to 5 years keep in mind that catastrophic depreciation is going to continue. A major key is to maintain a national market for yourself by using Ebay, Craigslist, Autotrader, etc. Time and cash are more important than individual models.
DCX minivans are probably as good as you can get in that kind of market if that is what you are looking for. Also Fusions and Crown Vics are reasonable. Avoid limited model runs because you need to be able to cherry pick (why I would avoid Mitsubishis for example)and know every corner garage will work on it.
Traditionally, the depreciation doesn’t slow at all until it is 40% of original list for most cars. Some of the models you mentioned were likely sold for 80% of list brand new! I think you may be being some of these too soon. Go back to 2004 for a real bargain.
Another bargain. Watch for factory sponsored leases. If the mileage they offer is more than you use, they can actually make sense. Take the total cost of the lease and compare to the likely total cost of new with actual depreciation. Also, ask about discount for paying for the whole lease up front. You should save all the interest or walk away. These deals can work for you if the total cost works out to under 200 per month.
en devouring in purchasing a vehicle over $1k in this market (job and commercial) is not worth losing my peaceful state of mind. I’ll observe and develop patiently, while en devouring how I see fit for the time being. That said, I own a 91 240SX, great car.
Now I better get going, if I’m going to get the brakes working again, and maybe have time to change the dead shocks. LOL, If its to difficult, I guess I’ll just need to fork over another $200 or so to a mechanic. The total will be around $500 bucks then. Those are the my consequences with this path I choose, doing it this way is just what works for me. In the end (right now) I have a reason and opportunity to be intimate with my car and understand things better, I can feel confident in what I’m driving. Just need to pay the piper. Ironically, in a contrarian way, hah, no wonder I love to be a contrarian, I’m starting to understand myself, cool. Again Ironic, I was trying to understand my car. When in the pits make like a pit mechanic, or not, we still make progress naturally.
Whoa, whoever recommended the Grand Marquis is right on the money. I checked locally and found an 2007 LS (leather, power everything) for 18,500. Talk about a bargain. And in the 16k range I found a low mileage Marauder (great vehicle for Toronto traffic…no one will ever cut you off).
I was recently pursuing a similar strategy for a larger vehicle (before I was laid off) and think that if you can live with the lack of power, the 500 and the Freestyle are remarkable bargains. And good used Tauruses are available everywhere at prices even lower than 16k, with as little as 2,000km.
For my daily driver/beater I’m feeding waaaaay below the $16K range. Still, the same rules apply.
In a total apples to apples comparison, the Mazda 626 was 40% less money than an Accord. Same condition, miles, options, etc. Now at 236K mostly trouble free miles, it’s tough to argue that the Honda has better durability than the Mazda in this one case. Just stay away from the crappy Ford supplied slush box…….
Back up in the 16K range – haven’t seen mention of domestic pickups. God only knows how many 2006 Rams Dodge unloaded the last 6 months of last year. At least around here every tough guy swinging D!$& is driving one. Gotta believe they’ll be cheap cheap in a year or so.
Ironically enough, in 2002 I almost bought a Pontiac Aztec because it seemed a good contrarian bet. However, as fate would have it, I must have gotten the LEAST pushiest salesman in town, and I couldn’t force myself to initiate the purchase.
Keep in mind Grand Marquis are cheap used because they are cheap new. Currently, you can buy one for around $7K off MSRP.
jolo Your arguement woiuld have merit if the 21k Honda or Toyota never broke down.
Matt D states correctly so called second rate vehicles are still quite reliable.
Prices are different in Canada as is the weather, the Hondas and Toyotas do indeed break and they cost a fortune to fix.
A smart used car buyer can do quite well if he follows the guide lines, in this well researched and written piece.
Well done Matt.
I got a bargain on my “unloved” used car–an ’02 Maxima. ’02 was the year the Altima came out, and the otherwise lame-duck Maxima was upgraded to the 3.5L V6. On the used market, the Maxima was going for little more than the 4-cylinder Altima! The Maxima was actually slightly smaller, and better looking, with >250 HP.
“The old adage says that a fool and his money are soon parted. If only it were that simple. A proud Camcord buyer easily pays $21k or more for a brand new model, replacing it every few years.”
Why would they replace it every few years? I still am driving my 1996 Corolla (though I did buy it used with 5k miles on it), and could probably drive it for another 4 or 5 years if I wanted to (only have 105k miles on it). But I am looking at buying a new car for better safety features and good fuel economy and low emissions. That rules out all of the “contrarian” options listed. I am pretty much looking at Toyota and Honda, though Hyundai is looking pretty good these days.
Side airbags are only now becoming standard in a lot of models, so previous year models don’t look so good, so I am probably going to buy a new car. I am going to keep my car for 10+ years and I am not the only one who does this.
Contrarian new car purchases are also possible. I got a new 2002 Civic Si in January 2003 for $14,995 with 1.9 percent financing. It listed at $19,500.
Although not as sporty as I would have hoped, and kind of dorky looking (or unique and euro as I like to think) it was cheaper, had more power, and more features than the same year Civic coupe or sedan.
Now I can sell it for $10-11k or keep it, take care of it, and get 200k plus reliable miles out of it.
I think there are new 2006 Mazdaspeed6s out there, and they even have a Mazda engine. I think people just don’t want a 4 cylinder midsize sport sedan.
After tons of research, I got my ’01 Trooper LS for $8500 off list in ’01. Sure, depreciation is a huge hit. But I buy my cars and run them into the ground (300k-400k average) before I replace them. There’s something about no car payments that attracts me…..
Here’s a pearl:
2004-2006 Saturn Vue V6. 3.5 liter V6 and 5-speed automatic supplied by Honda…the same powertrain that’s in the Acura TL. Couple that with legendary Saturn depreciation, and you have one hell of a deal. I’m in the market for one for my wife now…
I think there are new 2006 Mazdaspeed6s out there, and they even have a Mazda engine. I think people just don’t want a 4 cylinder midsize sport sedan.
Those are almost all gone by now and have been replaced with ’07 models (overproduced ’06 models) that don’t offer any major rebates yet. If you were in the market for one, last winter was certainly the right time. Paying 22k (30k MSRP) for this untouched 6-speed rocket makes it a gem in my book.
Those Camcord buyers must be turning ’em over, else how are Hondyota able sell 300K+ each every year.
For my 16K, i’d drop back a model year and go for a Lincoln LS. Best car Lincoln ever made, and a 2nd gen version could have stomped CTS/STS if they had the cojones to develop it.
Did Ford ever make the optional plate to protect the gas tank a standard feature on the Crown Vic/Grand Marquis? I know that’s been a pretty big issue with them and a few deaths, including State Troopers.
Back in 2004 I was able to purchase a new Grand AM Gt that had an MSRP of 24k for a little over 17k new. It’s the Fusion Orange one that not too many people wanted…I live in a small town and the dealer had it on the lot for a long time and made a deal I couldn’t refuse.
Needless to say, it will be driven till the wheels fall off.
I agree with the basic premise, but the numbers in the example make no sense to me.
I can see buying a car with a urban legend wrapped around it’s neck, but it has to be dirt cheap to the point where insurance isn’t a issue other then liability. It also has to be relatively easy and very inexpensive to repair.
Buying less then your first choice to save a couple thou makes no sense because all the fixed costs are the same and the car eventually has less residual value. In the end you pay the same or more for something that was your second or third choice.
But that’s just me, I prefer the extreme roads at either end rather then the middle road where you get attacked from both sides.
Another good deal used: Suzuki Aerio. Yeah, it’s ugly. But you can get a really good deal on a lightly-used one.
I’ve also noticed that you can get low-mileage Oldsmobile Aleros for cheap, although I don’t know what the reliability is on those (probably not too hot).
Would be nice to see an article like this centered around used vehicles for ~$8,000. Personally, for $16,000 I want a brand new vehicle with no miles on it yet.
Used maximas are a good deal, my purchase before last one.
“Did Ford ever make the optional plate to protect the gas tank a standard feature on the Crown Vic/Grand Marquis? I know that’s been a pretty big issue with them and a few deaths, including State Troopers.”
Uhhh… you have about a 1 in gazzilion chance of being rear ended as a civilian in a CV at a speed great enough for that to happen. It take A LOT of speed for that to happen.. most of them were 70+ MPH crashes. There is no car I have ever felt safer in than a Crown Vic.
Slightly higher up the food chain, I’m looking at a Caddy SRX. A sweet driving rig at bargain prices – 10/15 grand less than the BMW.
The Jaguar S Sedan looks gorgeous to me also, but these appear to have so many problems that people construct entire websites just to detail their personal stories of service problem purgatory.
So far no one has mentioned used Hyundai’s.
I’ve been musing over the idea that a repossessed Hyundai might be a pretty good bargain if the quality has improved as much as their supporters claim. I’m told that their used car value is about the same as if they’d been dropped by passing seagulls.
Opinions?
Hyundai is the catch-22 of contrarian car buying. Because Hyundai improves their quality so much every year, it would be difficult to buy a previous year model (of lesser quality). And contrarians don’t buy new.
I would second the idea of giving us another article or two like this, maybe review the $8000 area and the $12000 area. 12k is where I was comfortable buying a very nice used car, and 8k is still very decent. Below that would be pushing it though.
When the new Malibu comes out, the used versions of existing model should take an extra big hit of depreciation. They might be worth checking out for those inclined for contrarian values
I would avoid a used BMW. Chances are the original owner drove (or beat) the hell out of the car. From the 2nd owner on shall they learn what the BMW acronym really means – “Break My Wallet”…
Ford Focus ST, Mitsubishi Lancer Ralliart, and Nissan SE-R Spec V. Good grunt, great handling, and $10-12K used.
Matthew,
You had me until Uplander. Some cars are garbage at any price.
Otherwise, bravo! This is a great take on used car buying.
This article had a very good point, and a very debateable point. Overall you did a great job of covering both.
Point one is that you can get a great value out of an unpopular late model vehicle. That’s often true. When I purchase vehicles for a certain airline headquartered in Atlanta, I get 2004/5 Tauruses, Rangers and Windstars. Ironically they can be any color so long as they’re white. The prices usually range from $6500 (for highway miles) to $8500 and typically they’re good for another 10 to 12 years of commercial use.
The ‘magic’ $16k mark for my experience is a debateable point… but I understand why you used it. You have to put a cutoff somewhere or else there are simply too many scenarios to go over. Personally, I’ve found that on strictly economical terms… a ten year old compact vehicle that has been well maintained tends to be the best buy for daily commuting. A mid-90’s Mirage, Protege, or Sentra sedan that has been conservatively driven and well maintained can usually offer another 7 to 10 years of service with minimal depreciation cost and plenty of comfort. I actually have sold an awful lot of these models in the $2000 to $3000 range and given the price of gas, I think they’re actually better values than the Police Interceptors when it comes to long term satisfaction and ownership costs.
Specific models that are ‘in the news’ usually get a pop in their price these days because there are simply so many contrarians out there. However certain market segments and brands can be far more depressed due to a lack of new and competitive models in the new car market. Until last year you could get a Saturn for pretty much the rock bottom price in a particular segment regardless of the model. Now the S-Series of the late 90’s and early 2000’s go for more money than they did a year ago and the Vue is actually holding up it’s value as well. Gas prices are not so much the culprit as are new models which changed the consumer’s perception of the brand’s value. Minivans of today are depressed for much the same reason.
If you REALLY want to get an outstanding value in the market place, it simply takes a lot of research and patience. Buying a late model vehicle for cash with a ‘moderate accident’ record in it’s Carfax history is one possibility if you know how to access the claims records. Another is to focus on unpopular vehicles in their final year of production. I bought a 2004 Dodge Intrepid with leather and all the options (except a sunroof) for $3000 at one sale earlier this year. It was fleet maintained, highway driven (133k on the 3.5L engine) and ran like a top until I sold it to a Chrysler enthusiast.
One other method is to buy a vehicle that has a mechanical issue that is attributable to a recall. I bought a 1999 Volvo S70 GLT with about 150k and dealer records for $1850. The only thing it needed was to have it’s throttle body injection cleaned ($2 can of cleaner) and the recall work done on the engine. That, and one brand new driver’s seat for $150 (old one had a tear on a bolster) and I had a perfectly good car with an excellent dealer maintenance history.
There is an awful lot more to it than price points. In fact, if I were to sum it up in two words… it would be ‘asymetric information’.
Well that, and what Wee Willie Keeler said whenever the subject of getting a hit came up…
“You gotta hit em’ where they ain’t.”
“I bought a 1999 Volvo S70 GLT with about 150k and dealer records for $1850.”
What about Click and Clack’s take on Volvo reliability:
“We would expect the Volvo S60 to have Volvo’s typical level of reliability, which is to say, it should be very good. We wouldn’t expect much to go wrong while the car is still under warranty. Then, when parts do start to break at around 100,000 miles… be prepared to pay top dollar for replacement components.”
from CarTalk.
Is it smart to buy a Volvo with 150K on the clock?
I think this is a strong article on a relatively unmined subject. I do take issue with one point — I paid $16.6K for my Accord LX 3 years ago; not sure why people pay $21K, maybe to sit on dead cow skin?
I’d like to see comparisons of new vs. used vehicles. Like a 2007 Camry vs. a 2004 ES330. Or, a 2007 Miata vs. a 2002 Boxster.
Of course, it’s hard to control for the condition of a used car.
Maxo:
The problem with looking at cars worth $8K, is that every car on the market will someday be worth $8k during their lifespan, depending on wear and tear. And it is more complex to purchase a car that is more than one or two years old, because you have to take a harder look at its (individual) maintenance history.
I was tempted to look at used cars around $20-24K. However, in that price range, you are dealing with “wants” rather than “needs”, which also complicates such an analysis.
Hence, $16K is the sweet spot. It gets you a car of substance, with only the stuff you need, and still under warranty.
Maybe we’re just freaks, but our our ’98 S70 purchased new bled.us.dry. Finally traded it in owing $5k over what it was worth because of massive repairs (complete A/C, ABS master, 60k miles). Disappointed to say the least, because it was fun to drive, mighty comfortable, and rock solid. Pity.
“The problem with looking at cars worth $8K, is that every car on the market will someday be worth $8k during their lifespan, depending on wear and tear. And it is more complex to purchase a car that is more than one or two years old, because you have to take a harder look at its (individual) maintenance history.”
I’ll have to respectfully disagree here. Looking at databases, test driving a vehicle, obtaining maintenance records, and having it independently inspected by a mechanic is not really difficult to do. There may be fewer vehicles… but the number of good ones are still in the hundreds of thousands.
Really. It’s pretty easy to buy a good ten year old car if you’re willing to do your homework.
dave and malle…
Yes… Volvos tend to have longer model runs than most other vehicles and their parts (pre-2000) are actually dirt cheap if they’re purchased from an auto recycler and NOT a dealer. Dealer service costs are what hurt most new car buyers. Volvo has too many dealers in most metropolitan areas and too many models that are long in the tooth. The result is that most folks who go to a dealer for maintenance will pay through the nose.
Volvos until the latest (40/60/80) generations were considered the pinnacle for durability and safety. The 850/S70 models can usually run in excess of 250k if they have been driven normally and properly maintained.
Like you, Up until now, at least, I’ve been a contrarian. I did my research and came up with a decidedly different answer, only because my requirements were different. The last time I bought a car, I wanted a used vehicle, but I could only afford something < $10K. That meant I was limited to an older model, with more mileage. I needed something that would last for at least another 4 years/50K miles, fun to drive, room for four, room for me (6’4”), and the ability to haul at least some stuff (drums, guitars, etc.). I wanted a vehicle that would be inexpensive to repair, with a ready supply of parts, good reliability, and something with the ability to get on and off an Interstate without wheezing. Oh, and something that would retain some value. My choice? Five years ago, it was a 97 Jeep Wrangler with 86K miles for $9K. Here we are five years later, and I’m still driving it. Repairs? Just one brake spring, and four new tires. It’s now got just over 120K miles on it, and it’s still going strong. The kicker is that 97 Wranglers are selling locally for…$9K. When I do sell, I’ll have essentially driven my TJ for five years for the cost of gas, oil, and insurance. Not a bad deal. My next vehicle will be a Jeep Wrangler, without a doubt.
Saabs tend to be excellent used car deals, because they depreciate rapidly over the first two or three years. A 2003 9-5 Aero should run you about $16k, and is insubstantially different than the $40k 2007 model.
I’ve been in the position lately of being a sounding board for several friend who due to unexpected circumstances needed to buy a good enough used car cheap. Late model GM sedans as long as they don’t have the 3.1/3.4 V-6 engines (lots of intake manifold gasket problems) are often an excellent deal. 3.8 liter equipped Impalas, Buicks and Pontiacs can all be an outstanding value. Late model Tauri and the Five Hundred also often a lot of car for the money.
New I would generally buy a Honda product or Toyota product, but they depreciate so slowly as to rarely be a good used car value. The idea is to buy low, sell high … not the other way around.
The European brand vehicles frequently become hideously expensive to keep in good repair once the years and miles pile on. One of my now Taurus owning friends is in the situation because his well cared for 100k mile Saab 9-5 died a horrible early death due to PCV system design problems which caused engine sludge and ruined the motor. He followed the Saab recommendation of 10,000 mile oil changes with synthetic oil, but that design wasn’t up to the job and he is hosed.
GM products seem to start failing with lots of little problems like torn seats, failed wiper motors, failed in tank fuel pumps and such. Luckily there are zillions of them around and the trouble spot failure rates are high enough that low cost aftermarket parts are generally available to fix the problem.
Ford seems to have fewer of these secondary parts failing for no good reason problems.
Chrysler products by and large aren’t well made to start with and don’t get better with age.
All my humble opinion only, of course. Thus I agree with the author, well maintained late model Ford products are often a bargain hunter’s delight. When possible, get the Mercury version as it is normally a bit better equipped at the same or lower price.
Maybe we’re just freaks, but our our ‘98 S70 purchased new bled.us.dry. Finally traded it in owing $5k over what it was worth because of massive repairs (complete A/C, ABS master, 60k miles). Disappointed to say the least, because it was fun to drive, mighty comfortable, and rock solid. Pity.
All common problems with mid to late ’90s front wheel drive Volvos. The A/C evaporator failure and ABS controller failures are nearly 100% failure rate parts sometime after the warranty is over, and the evaporator requires complete tear down of the dash area to get to for replacement. A real nightmare bit of engineering! The ABS controller should have been recalled for it’s high failure rate, but Volvo says it isn’t a safety issue. Of course when you buy the car they say ABS is a safety feature, but when ABS stops working it isn’t a safety issue. Only a lawyer could dream up that logic!
Stay far, far away from any of the GM minivans (Uplander, Venture, etc.). They were not very good when new and don’t age well. We have owned two of them and both where in need of lots of expensive repairs once they got over 40k miles, and the interiors were rattling like crazy. A bad design from day one made no better by a horrible nose job at mid-life and now being euthanized by GM.
I used to have this down to an art..
-Car hated due to bad trannys..buy the 5sp
-2.7l engine imploding? Buy the 3.5 and pocket the savings
-model changed? Buy the last year of the previous gen to take advantage of bug fixes over earlier years, a readily available parts supply (new and used), and automotive forums filled with owner experience.
-Mazda Protege, 626(manual) and Millenia are excellent used buys
-Ford Focus post 04 is a good grocery getter
-Malibu Maxx despite the interior sells for next to nothing and has sliding rear seats
-Pontiac G6 models are flooding the rental market and the used value will plummet..time to pick up the 6speed
-Volvo S60 is being given away..even the AWD models
-as mentioned by others, the 03 Maxima is a great car and a used steal
-Caddy CTS can be found at a good price as well
Brand new PT Cruisers and Cobalts are advertised regularly in the paper for $9988. Brand new Rams and 1500s for $14,444.
If you bought one of these, and tried to sell it off a week later; what would the likely price be(how much of a loss would one incur)?
It blows my mind when I see much older models of these vehicles for sale at much higher prices.
GM should declare war on honda/toyota and sell the Aveos at ~$6,000-$9,000. Or start importing the best of the China cars. Shut down U.S. operations and only import. That would be drastic and shake things up a bit. Think Mexico/Canada could shoulder the load? Start importing the Euro models with the proper DOT stuff. If I’m correct; China cars are left hand drive…(from the pics I’ve seen) I guess they drive on the right side of the street too? ;)
I know decent cars can be made in China. They just need a little “advice” on what exactly to improve. Go in there with some gusto and bravado and make some world class cars. Boom times like the 1960’s all over again. Do anything and do all.
Which one of these mother snakes is going to be the first car to the U.S. market?
http://www.chinacarforums.com/forum/
What if I could buy these cars online? At Wal-Mart? Anyplace but a G.D. dealer! Get it “warrantied” at a local garage and have the manufacturer reimburse the local mechanic!?
Why again do we need a dealer for anything more then a “test drive”? I’m sure this could be worked around too..
Have one of each model at a willing local garage for test drives? Pay a nominal fee to cover the fuel or just have the OEM cover it as costs of doing business? Have the rental car places have them for rent and also have them handle the “test drives”?
I feel sorry for a particular Mitsubishi dealer I drive by everyday on my way to work. An entire lot full of Eclipses. I don’t know if he will ever sell them. I don’t know if he’s sold a single one. Want pics? It’s pathetic.
The price is wrong. The car is heavy. The motor is lame. All motor V6 with no potential. Have you ever seen a “fast” Eclipse? How about a fast 350Z? I haven’t seen anything that impressed. Now back in the day when they made turbo Eclipses and 300Z’s….. Those cars had potential and I saw plenty that impressed. I still see plenty of hopped up Turbo E’s that would smoke any new E or 350 any day of the week. For eternity it will be that way. There will never, ever be “fast” 350z’s or new model E’s.
So I’m looking to import a new China car… eBay motors have any for sale? Figure about ~$1,000 or so to put it in a shipping container? I’ll pick it up down at the local rail yard where they deal with those containers… Buy the parts direct over the net? Hey China; there’s this new thing called the internet. Should look into it… Maybe sell some cars with it.
Uhm. Did just that in ’97 with a new ’96 Mercury Mistake with the 2.5 Duratec and a slush box. Sold new, it came at a very, very heavily discounted fleet sale price (trunk had been repainted after a tree branch fell over it, disclosed).
During three painful years of ownership I suffered trough four recalls, twelve trips for warranty repairs and countless ‘check engine’ lights (tape over light eventually ‘solved’it). If you plan on using this strategy… stick with unloved Mistus, Subarus and the other common offerings from Asia like the old Trooper. If you go domestic still under warranty… make sure that the dealer is within walking distance from your home or work is all I can say.
I’ve played this game myself (and loved the XR4Ti and Saab 900t that came of it). An earlier poster hit he mark, though, when bringing up time of ownership. How long do you plan on keeping it? As much as I understand the desire to run the wheels off the thing for 200k miles, I desire a bit of change from time to time. 3-5 years, max. And in that time, whatever caused the car to depreciate in the first place hasn’t changed. Resale value when I purchased is still reflected when I sell.
Sure, you could get a crown vic for a song, but you’ll sell it for pocket change 5 years dow nthe road.
The standard rules still apply: do your research, don’t rush, and try to buy something that you will enjoy.
Old Trooper?
Not in an area that salts the roads in the winter.
I’m batting about .500 with used cars. The old adage about buying somebody else’s problem often holds true. Twenty mechanics would not have uncovered the intermittent fuel pump problem in my ’88 Audi or the oh-so-subtle bent “frame” on the ’92 BMW. So before you plunk down 16 large for the Grand Marquis (de Sade), remember you’re still taking a chance.
Hmmm… I never had an a/c issue but I do have to say that the ABS Module Volvo has is a $#$@$%.
You can replace them for less than $200 and they’re very easy to remove as well. As a matter of fact, I know one fellow who actually makes a nice side income from doing that.
Overall the engines, trannies and powertrains for the 850/S70’s of the mid to late 90’s are among the best of that era. I’ve liquidated tens of thousands of vehicles over the years and I can honestly say that if I would ever stick to one kind of manufacturer for the under 5k retail customers, it would be Volvos from that time period.
I also have a fellow whose a top ten buyer at two different sales that has the same sentiment. Volvos can have niggling issues. But the basic powertrain is bulletproof and the snob appeal is substantial.
FWIW back in December ’04 I bought an ’04 Olds Alero V6 with under 5K on it for $12800, it stickered for $22K. Now granted it probably sold new for closer to $17-18K, but I still got an as-new car for an attractive price, and now at three years old and 48600 miles, it still runs, looks and drives like it did at 5K, and has spent very little time at the dealer for repairs. Even though it has to travel on Michigan’s frost heaved roads, the body has yet to develop a single squeak or rattle. It has lots of nice features inside, plus four wheel disc brakes w/ABS and traction control, an incredible sounding stereo, gets around 30mpg on the highway, and has the legendary Oldsmobile name attached to it. As far as I am concerned, the little Alero is a fine used car bargin and an all around great little car!!! Too bad GM doesn’t offer anything other than the G6 as an equivilant replacement for it, which is why I am sure that my next car one day will be a T or H…
My first rule of car buying…avoid new cars. This article definitely falls within my philosophical sphere regarding buying cars. I noticed the Maxima was mentioned as a used car bargain; since I have purchased both a used Maxima and a used I35 in the past, I have to agree.
Personally, I think the 2003-2004 Infiniti M45 is one of the better used car bargains around. A 3-4 year old luxury sedan with a 340HP V-8 and all the interior trimmings. Also, depreciation has been brutal since it was discontinued for a year. One of the ultimate “Q-Ships.”
In fact, the whole “Q-Ship” topic needs more exploration. What are the ten biggest “Q-Ships?”
i’ve seen people suggesting maximas; another strategy to find cheap cars is check out the yearly list for the most stolen autos. they’re usually cheaper.
I employ a slightly different strategy. Why should I have to ‘suffer’ with a boring car just to save a buck? I seek out slightly older (5-6 years) cars with around 100,000 miles on them. I find this is often the point that decently maintained cars get swapped out for new ones, and the depreciation hit at this mileage is pretty tall. I can research the car easily on the internet and find out it’s common problems (if any). Maintenence records and a clean problem history can generally assure me trouble free motoring to the 200,000 mark, and if I’ve bought a car that is interesting and not a vanilla vehicle, I can actually sell it when I’m tired of it. The problem with picking an unloved vehicle and running it that far is you do practically have to pay someone to take it, where I can off my worn but functional ride for a couple of thou. My method is a little harder, maybe a bit riskier, and assumes the buyer has more technical savvy than the average mouth breather but I have yet to spend more than $6000 for a car (and they NEVER grace the entry of a dealership!).
They're not all under $16,000 (yet), but here's my list of undervalued models: TrueDelta
One commenter mentioned buying a car with a “moderate” accident history. I’ve done that myself, with good results. However, in both cases, it was a car which had it’s “moderate” accident fairly early in its life and then was driven another 5 years/50K miles or so by the original owner. I took that to be an indication that the damage was, in fact, very moderate, and that the car hadn’t developed any weird quirks. Both cars worked out OK.
I don’t think I’d buy a car with an accident history until well after the accident had occurred, to see what sort of problems migh have arisen as a result.
Of course, taking along the CarFax and showing the seller that you know about the accident does help you negotiate on price. They could hold out but the shock of learning that you know about the accident seems to weaken their resolve.
On Volvos, I loved our RWD/I4 Volvos but I would not touch one of the new ones. Volvo reliability never seemed to be all that great but they were simple, so there was less to go wrong, and had large engine bays so they were easier to work on but the increased complexity of the newer ones and tight layout of the I5/FWD cars suggests trouble to me. They are comfortable, beautiful looking and excellent driving cars but I won’t buy one until I hit the PowerBall.
Well, I may be late to this party but I cant help but chime in. This is only contrarian in the sense of buying low and avoiding the toyota/Honda mystique:
You can march down to your local mazda dealer and score yourself a brand spankin new 2007 mazda 6 sport value pack for $16k (an obscene value).
Prior to these prices on the mazda 6, the protege was the buy of all buys. At $14,500, this was a fantastic car for the money. As good as it was, the Mazda 6 is an even better deal for the money.
Maybe this represents the contrarian “new” car buyer?
Great topic, nice article.
I would avoid a used BMW. Chances are the original owner drove (or beat) the hell out of the car. From the 2nd owner on shall they learn what the BMW acronym really means – “Break My Wallet”…
I had a divorce client who put $400 per month for car repairs on his financial statement. I questioned him about it, and he said, “You try owning a 10 year old BMW.”
i had mixed luck with a used maxima, however, i liked the car a lot and would probably try another used maxima.
I’m interested in purchasing a ’95-99 MX-5. Anyone have any experiences on reliability and things to look for? I want a sporty car, but don’t have the time nor large bank roll to make many repairs. I figure since the Miata is a relatively simple car, there are few things that can break and when they do its a simple repair. Is this assumption incorrect?
Great article. With the web today, finding used gems is a great pasttime for the car enthusiast. I prefer manual shift jap sedans – but the I4 Fusion manual may be in my future. Then again, maybe I’ll live large and try the ‘Break My Wallet’ brand…
The Crown Vic and its clones are decent animals. Be careful about the Marauder – great looking car but I think a TTAC piece mentioned it as one of the most stolen cars that’s never recovered.
ihatetrees:
Yep, that’s my top choice right now: 2006 Fusion SEL I4 with manual, thank you very much. And I might even be able get leather, too, at $16K used.
FYI, large Ford vehicles like Lincoln and Mercury are the best used bargains. The Marquis over the Crown Vic, and the Town Car, Continental and LS are common with low miles and garaged. I just picked up a 2000 Continental with 25K miles for 8500. The window sticker (in the glove box) said 40K. Still smells new too. No one looks for used Mercury’s (or Buicks) except savy buyers looking for cheap, safe, reliable transportation.
Being that I drive a lot of highway miles and witness some pretty good rear enders almost daily, I’ll pass on the Grand Marquis/Crown Vic.
Even if it does require a high speed impact (from a car, imagine what a large SUV would do at a lower speed), the fact they never fixed that bothers me (personal opinion here).
And anytime I look at one of those cars I think of Grandpa…no thank you. :-)
I think the problem with the $16K price point, as several others have pointed out, is that there are lots of NEW cars you can buy that are fairly decent for that money, so you are not getting that much more for your money.
As a used car buyer, I usually shoot for 3 year old cars… there seem to be lots of people that take on 3 year leases, so lots of 3 year old cars are on the market. I agree that Fords are decent used car bets. My wife drives an explorer that we bought 3 years old, and I used to have a Ranger that we bought 3 years old. Generally this means that you get no or little warranty, but I usually get just enought to get any initial issues taken care of right before it runs out.
I’m on my second used BMW and I have found them to be reliable. My first was an 88 325, that i had for about 3 years, sold it about a year ago… being that it was an 18 year old car, I’d say that repairs/maintenance were not too bad… less than $1000/year, which beats a car payment by a large margin. Two years ago I bought a 2002 330i, and it has not had many issues either. Certainly no more than I would expect in any other 3-5 year old car (outside of perhaps a Honda/Yota).
“Overall the engines, trannies and powertrains for the 850/S70’s of the mid to late 90’s are among the best of that era. I’ve liquidated tens of thousands of vehicles over the years and I can honestly say that if I would ever stick to one kind of manufacturer for the under 5k retail customers, it would be Volvos from that time period.”
Any problems with the full on turbo 850’s, or are they all a safe bet (eyeing mid 90’s 850 R …)
I can’t comment on 10 year old BMWs. But I can chime in on 18 year old BMWs, since I have a 1989 325i. I bought it a couple of years ago for $4,400, and I’m pretty sure I could sell it today for that. It is hard to find a nice running car that still looks good for less than $5,000. There is really nothing more to it than any car. Oil changes, spark plugs, brake pads, just typical stuff. I don’t know how that adds up to $400 per month. Maybe if you are taking it to a dealer for routine service, but the E30s are pretty easy for the DIY type to work on, and any good indy mechanic can do this stuff, plus timing belt and water pump changes. Maybe they are alot more troublesome once you get past the E30 model.
Same with a W124 Mercedes Benz E320 I have. Just normal service stuff.
Learn how to change your own oil and do brakes and spark plugs and you’ll significanty lower maintenance costs for ANY cars, if you are really serious about saving money.
There is the opposite view.
That is, buy a car that has very low depreciation and sell it after a short period of time.
I bought a 2006 Scion xA in August 2005. I paid MSRP, of course, since it’s a Scion you have to. Sticker was $15,325.
I could now sell it for $13,500 or so, for a 21 month depreciation of about 12%, meaning I could have driven a brand new car for about $90 a month plus gas and insurance. Scions are typically kept in short supply on purpose by Toyota, plus the fact that one can go into a Toyota dealer today and still buy an identical model brand new (there are no 2007 Scion xA or xBs; Toyota boosted production at the end of 2006 to allow dealers to have some stock until the 2008s arrive in a few months, contrary to thier typical policy). Both of these boost the resale value.
Another car one could pull this trick was the Prius until recently (heck, dud to long waiting lists, sometimes used Priuses were selling above MSRP for new ones), although Toyota has boosted production on those on a permanent basis recently and I’m not sure thier uber-high resale value will continue.
Of course, I’m not actually going to take my own advice here-I plan on keeping the car for 5-10 years, at least.
But the logic goes as such:
For a popular car (Hondas, Toyotas, certain sports cars), it’s stupid to buy used when you can buy new for not much more.
For a not-so-popular car (almost all domestics, many Hyundai/Kias, certain second tier Japanese models, duds from any manufacturer), it’s stupid to buy new, unless you are able to get a huge discount off MSRP to start with.
Geotpf:
Good idea about the Scion–low depreciation means you can buy new and sell at little loss in a few years. However, there is an element of risk because the Scion’s resale is based on the fact that it is *fashionable*, and that is notoriously difficult to predict. Case in point: New Beetle. Very fashionable for a few years–now, not so much. Great idea, but too much risk for my stomach.
When buying a used car, unless you’re buying it from the used car department of a new car dealership, it is almost always “buyer beware” big time. New car stores value their reputation – well, most do – and they’re very liable to the State Attorney General of wherever they are located; so even if they unload a lemon on you – perhaps unknowingly – you can get the matter resolved.
In Washington State, where I live, a prominent Toyota dealer opened shop in Kirkland, Washington, from his base in Portland, Oregon. His people sold a number of “lemons” and angry customers picketed and contacted the State AG. The dealer made things right, but ended up deciding “discretion was the better part of valor,” as goes an old saying and left.
If you buy a car from a used car lot, dedicated to only used cars, insist on a “buyer’s check” – having a reputable auto service technician you or a friend knows – look the car over. And if they won’t do that, at the very least, ask to see the records of the former owner – which may not be available, if the car was bought used, at a dealer’s auction.
My suggestion, is that unless you are prepared to spend maybe $1,000 or two, in the first couple of years, if the used car dealer can’t give you one or both of those aforementioned options, go elsewhere.
The best used car tip is the 1996 through 2000 Mazda Millenia with the Miller-cycle supercharged V6. It was an outstanding car – drove it twice, in different years, on long trips – that retailed for $26,645 in 1999. That vintage now retails for an average of $4,650.
If well taken care of, it is the equal of the new Lexus. Admittedly, most people won’t know what it is. But if you’re a real auto enthusiast, that won’t matter. It’s the driving and the low cost of getting into such a fine luxury car that will.
Wern’t the failure rates of the Ford auto trannies in the Millenia and 626 frightenly high?
Replying to author:
The old adage says that a fool and his money are soon parted. If only it were that simple. A proud Camcord buyer easily pays $21k or more for a brand new model, replacing it every few years.
But the contrarian, with the clarity of an economist, pays $16k for a gently used Fusion or the like with a similar feature set. And then banks a $5,000 buffer to cover any (real or perceived) differences in reliability. Just who is the fool now?
The Fusion buyer is obviously the fool.
I still remember, when I came to North America 14 years ago, that the Detroit 3 claimed they were on par with Toyota/Honda in terms of quality. Of course, these claims were for the new models only. People tend to forget about the old claims and move on to the next round of empty claims.
Since most Camry/Accords are expected to last at least 10 years, can you tell me which 1997 Detroit 3 family sedan was on par in quality? People should absolutely dismiss these claims, until there is a proven 10-year-long track record.
Buying a used Fusion may be a better deal than buying a used Accord. But definitely not better than buying a new Accord. IMO, the ranking is like this:
1) Buy new Accord (best)
2) Buy used Fusion
3) Buy used Accord
4) Buy new Fusion (worst)
Since Accords are now selling for $2-3K under MSRP, I see no reason to buy Detroit.
wsn:
I still remember, when I came to North America 14 years ago, that the Detroit 3 claimed they were on par with Toyota/Honda in terms of quality. Of course, these claims were for the new models only. People tend to forget about the old claims and move on to the next round of empty claims.
I think we agree on a lot:
–I agree that the marketing departments of the Big 2.5 spin quite a lot of fantasy. That is why I based my favorable opinion of the Fusion on a wide variety of independent and respected 3rd-party reviews.
–I agree that (in general) a vintage 1997 Big 3 car does not compare to its Asian counterpart in quality.
–I agree that (as a broad generalization subject to certain exceptions) current Big 3 cars also do not match Asian counterparts in quality.
However, consider this line of reasoning:
–As a result of a bad reputation over the years, the resale values of certain cars are quite low.
–Despite the fact that the quality is lower when measured relative to Asian counterparts, when analyzed independently, the quality of a 2006 domestic may in fact measure high enough to qualify as perfectly acceptable reliable transportation.
–And, given the rapid depreciation and resulting quality versus price ratio, buying a one-year-old domestic may in fact be a good financial decision.
I look at the cost of ownership in terms of cents per mile. For the cheapest Fusion vs. the cheapest Accord, 2007 new vs. 2006 used, Edmunds had these figures for the first five years:
Accord new, 53 cents, Accord used, 55 cents
Fusion new, 56 cents, Fusion used, 49 cents
Has anyone here ever thought about the best places to find deals on cars? I’ve found the very best place to buy a really good used car is Manhattan. Yes, New York. Here is why.
If you want a car in New York, you are almost forced to buy a parking spot in a garage. The cost is anywhere from $300-$1500 per month. Now, New York has a lot of people in the financial industry. Many of these people are from other countries, or they work for companies that send them to branches in Europe and Asia. When they are out of town, there is no way they can move their car back and forth on the street to accommodate alternate side of the street parking. So, the result is lots of low mileage cars, sitting in climate controlled garages. For example, I once bought a beautiful ten year old Audi quattro with 52k for $650. The guy who sold it was getting a transfer to London. It was also the last day of the month, and the next day he was going to shell out $800 for his garage rent. I have bought several cars this way. I bought my 1997 Saab 9000 CSE with 29k when it was three years old for 10k. I have been driving this car for the last seven years and only doing normal maintenance. If I sold it today, given the great condition, I could probably get $4-5k. So it cost me $5k for 7 years while driving a very nice car. New York is the place, as crazy as it sounds. But New York city is the WORST place to own a car.
boredlawstudent: Wern’t the failure rates of the Ford auto trannies in the Millenia and 626 frightenly high?
Your answer is here:
Sid Vicious: In a total apples to apples comparison, the Mazda 626 was 40% less money than an Accord. Same condition, miles, options, etc. Now at 236K mostly trouble free miles, it’s tough to argue that the Honda has better durability than the Mazda in this one case. Just stay away from the crappy Ford supplied slush box…….
As long as you don’t go for an AT, a 626 is a pretty decent car. I’ve had one myself.
jjacob9105: I look at the cost of ownership in terms of cents per mile. For the cheapest Fusion vs. the cheapest Accord, 2007 new vs. 2006 used, Edmunds had these figures for the first five years:
Accord new, 53 cents, Accord used, 55 cents
Fusion new, 56 cents, Fusion used, 49 cents
I’m flabbergasted why more people don’t look at it that way. Here where I live, people do tend to sell cars (mostly Hondas and Toyotas, due to their “great” resale value) at three years simply so that they don’t lose so much money on the resale. Of course, babying a car and keeping the mileage low to protect the all-important resale value gives them a “cost-per-mile” that’s outrageously high to my undervalued Mazda.
Good article, and we have come at the subject from a similar angle at Autosavant. Lots of bargains out there if you are somewhat savvy about both the cars and their values in the secondary markets.
If you want see our take on it, go to Autosavant.net, and look on the right-side column. We update every month.
Personally, all I buy is used cars for myself, and new cars for the significant other (she does not like getting her car fixed, ever). But, I don’t care about that, and the bargain is too good to ignore.
With the shakeout in full-size trucks and full-size SUVs occurring, those already dropping prices will suffer further insult in the next couple of years, and conversely, used Chevrolet Aveos are starting to plateau in price a little bit at the auction, as opposed to dropping like a rock the first two years.
Anyway… great article.