Originally Posted By: KGMtech
Originally Posted By: 69GTX
Originally Posted By: KGMtech
Single biggest cost of car ownership is depreciation, as this one is at the bottom of the curve....keep on driving until it is no longer safe.
Depreciation is the biggest cost....until repairs due to age and wear take over, and they will. Depreciation should slow down in the 6-10 yr time frame, but it never stops except for collector cars. I drove my last car past the 150K mile point...or another 80K miles and 5 years. That was just dumb as the car depreciated from $1500+ down to $500 and the repairs over those 4 years exceeded the original $1,500 value (brakes, tires, radiator, suspension, emissions system/exhaust, AC, window motors, etc.). Many times, the right decision is to bail out. If you buy these same cars used with 30K-60K miles at the 3-7 year point, you don't have to suffer the original huge depreciation hit the original owner does.
For my limited, but documented experience:
2004 VW Passat, owned from new, now with 161,600 km. I've spent $4,750 CAD on repairs, $7,359 CAD on maintenance, and $32,588 CAD on depreciation (I paid $36,588 for it in 2004 and it might get $4k now).
To your point, if I say 75% of the total depreciation - for simplicity - happened in the first 5 years, and the remaining depreciation over the last 7 years...I get $1,163 CAD per year depreciation in the last 7 years with present value $4,000 CAD.
So my numbers for a car that BITOG fans says is a maintenance and repair hog with low resale...show that depreciation is a larger cost versus repairs and maintenance which have been @ $1,009 CAD per year.
Disclaimer: I do my own repairs and maintenance
) But I think this would be typical for most BITOG'ers
I'm talking about 150K miles and you're in km. At 161km or 100K miles your Passat is not yet into the break down zone where maintenance will overwhelm depreciation. At only 12 yrs old and 100K miles it's still young. If your car were up to 250km I'd bet it would be different. My 2002 Lincoln (bought in 2009 with 22K miles for $9K) was 75% depreciated the day I bought it. It's probably down to 90% depreciated today. And maintenance costs haven't begun to overwhelm it because it's only got 72K miles on it (45 km). Had I driven it 2X as much (145K miles) the maintenance costs would likely be higher than depreciation. These older cars not yet close to 150K miles will probably depreciate more than the maint costs for a few more years.