When you go and look for a car, what do you look for? A lot of times, it's an emotional connection, you get excited about a particular brand. They call that "getting into your funnel."
But what really matters with a car? Certainly reliability is a big factor. But how about what it actually costs you?
Two new surveys, one by AAA and the other by Kelley Blue Book, point out that the sticker price on a car is not nearly as important as the overall cost of ownership over 5 years.
2 Winners This Year
So if you really want your wallet to smile on you, what brand would you buy that would give you the lowest cost of ownership? That would be Mazda, according to KBB's 5-Year Cost To Own Awards.
Mazda has a lot of vehicles that are truly fun to drive but don't make it on the list of a lot of car buyers. If you're a luxury car buyer, Lexus is the brand that has a really low cost of ownership.
Is Leasing The Answer?
Leasing is all the rage in the auto industry again, but does it make sense for you to get into a car this way?
I've seen several news reports that say leasing is now the No. 1 strategy of automakers and car dealers to reverse the trend that we're keeping cars much longer. The average age of a car out on the road is now the longest it's ever been.
One story I saw proclaimed that 200,000 miles is the new 100,000 miles, as more people start to see their cars as being babies once they hit 100,000 miles and keep them on the road.
With increases in car reliability, it's entirely possible that you might keep a car 10 years without breaking a sweat. That's not good for automakers and dealers. So you'll be seeing a strong effort to lease one in three of every new cars that gets sold.
For the most part, leasing is a disaster for you. Edmunds.com has new numbers to give you a sense of just how much of a disaster it can be. Basing their calculations on a car that sells in the mid $20,000 range, they've estimated leasing will cost you $6,000 more than buying the car new. That loss goes up to over $10,000 vs. buying a gently used version of that same car a couple of model years old.
When you get on that lease treadmill every 2-4 years, each time you're taking on an obligation and you have nothing to show for it at the end. Each time you take on 100% of the loss in value of the vehicle for the time you drive it.
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