April 19, 2011

Category: Money Management

Evaluating what a car really costs

Are you thinking about buying a car this year or concerned about what your current vehicle(s) cost you? With elevated gas prices added to challenging times, auto economics are on everyone's mind. Apart from the price of a car, the ongoing costs of maintenance, insurance, fuel and repairs is what really adds to the cost of owning a car. 

If you're thinking of buying a new car, the price difference of cars is not the only difference to take into account. A report by Edmunds.com rates the the best hybrids as follows.  "The  2010 Toyota Prius (base price $22,000) secures a straight sweep by achieving essentially the same fuel economy regardless of driving environment. The new Prius proved to be a better long-distance car than before, with a bit more power and a more comfortable cabin.  The 2010 Honda Insight (base price $19,800) is the cheapest hybrid on the market and certainly delivers fuel-sipping savings at the pump as well. However, its mild-hybrid powertrain that creates those savings leads to usability compromises — most notably the air-conditioner shutoff.  Also, the Insight's restricted backseat space makes it significantly less practical than all but the Mini. The 2009 Volkswagen Jetta TDI ($22,270) proved the promise of clean diesel technology. While not delivering the best gas mileage or the lowest price, the Jetta is better equipped than the hybrids' base models and feels the most like a normal car.  With fewer costly technologies onboard, there are also fewer costly technologies to fix or replace in the long term. Of course, the fluctuating cost of diesel fuel is something to consider. The 2010 Ford Fusion Hybrid (base price $27,270) was the most expensive car in this test, but it was also the biggest, the most comfortable, the most luxurious and achieves the best safety scores. Among the small group of hybridized family sedans, this is definitely the one to buy. However, it'll take eight years to recoup the hybrid's price premium over the regular four-cylinder Fusion with fuel savings. The 2009 Mini Cooper (base price $18,550) was the least expensive car in the test, but also the least fuel-efficient. Its thirst for premium fuel further hurt its cause. However, the Mini is the fuel-sipping car for driving enthusiasts, and its tiny proportions make parking and maneuvering through busy cities a snap. " 

There is a wealth of information available online via sites such as Edmunds.com and Kelley Blue Book. So compare cars on  a variety of criteria that will provide for a more wholesome cost & performance evaluation such as :

  • safety tests,
  • general maintenance,
  • cost of insurance,
  • how long you plan to keep the car (re-sale value plays a role if you want to keep the car for a short period of time
  • quality of warranty
  Ritu Mehta, Editor ACE Cash Express Money Management Tips