Sticker shock and the long term
Nov 19, 2024
Things seem really wonky to me right now. I’ve just come home from car shopping with my younger son. I was stunned at the asking prices. But let me be clear; we were looking at a ‘beater’ for him to drive to work this winter not a new truck or SUV. We surfed the online listings for something simple and reliable, and today we spent a couple of hours looking at a 14-year-old Dodge Caravan with 134,000 on it. At $8,000, it was the best deal we’d found after a couple of weeks of searching. You might recall back in 2011, Chrysler had amazing deals on Dodge vans as they were being phased out. You could get a new one for $25,000. So, it’s still worth about 1/3 of the original price with all those miles and rust too.
We were not looking for a high-end vehicle but I tripped across a 2010 BMW 750 sedan for the same $8,000 asking price. Instead of 134,000 km, it only had 89,000 and had clearly been well-maintained and garage kept. It looked like new. What’s going on?
We never even discussed the BMW. I just assumed that the service costs would be prohibitive, and maybe the insurance too. The BMW would have been close to $100,000 new. Now it’s priced neck and neck with a rusty Dodge Caravan.
It makes me wonder about the fabulous new boats that I just saw debut at the Fort Lauderdale show. They were bigger, more beautiful and more luxuriously-equipped than ever before. Will these boats hold onto their value over the years or will they be like that BMW? Will used boat buyers start to shy away from high-end boats? The advanced features and high-tech may be a concern. Used boat buyers may not want to face the maintenance and repair costs. Because if they can afford that, why wouldn’t they buy a new boat with what will surely be the latest and greatest features?
Will todays’ beauty queens become tomorrows’ orphans? It’s easy to see that many of these new boats are simply fabulous, but I think we all know that fashion moves fast. The wealthy buyer may want to trade up again soon and then you will need to get good money for that trade to put the deal together.
In the back of my head, I think that BMW would be a fabulous car but then a little voice whispers, “What if the transmission goes?” There can be sticker shock for repairs for sure. Things just seem a little wonky…
Andy Adams – Editor
