The decision between buying a new or used car has plagued the minds of consumers for ages. On one side of the coin, showroom cars sparkle and have that enticing “new car smell.” Their newness also comes with the comfort of knowing that you won’t break down any time soon. Used — or “pre-owned” as dealers now dub them — can be purchased at significant discounts after just a year or two on the road. That savings looks very good to frugal buyers. But, at the end of the day, most car purchases are made with value in mind. Or, how much you pay versus how long the car will perform without costly repairs.
The increasing amount of technology being incorporated into new vehicles is complicating the math consumers use to determine value. These days, it’s not just about how many miles the engine lasts. It’s also about the vehicle’s potential tech life.
Since the 1980s, technology has been fast-tracked into automobiles and touted as a key selling point. During the last 10 years or so, cars companies have integrated sonar, radar, lasers, computerized devices, navigation, and safety systems. Most new vehicles have between 25 and 50 central processing units networked right into the car’s operating system. With today’s trending technology, it makes good consumer sense to jam all this into a car, doesn’t it?
Between the need for immediate gratification and the rapid pace of changing technology, many people get a new phone every year or two. Cell phone companies build in discount upgrades right into existing plans. And, home computers are often replaced every four years.
But, why so much turnover? The simple answer is that these gadgets aren’t built to last. Now wrap your brain around this tidbit. The same computer parts that have a life expectancy of five years are being put into your car. Technology rocks, right? Not so much.
Life Expectancy of a Car
Let’s take a look at how the new consumer car math works. The ratings for how long a car may last is closely tied to how many miles the engine can handle. Many new cars are estimated to operate reliably up to 150,000 miles. If you crack the 200,000-mile barrier without any major repairs, you’re definitely into bonus rounds. On average, Americans drives about 16,000 miles per year while men between 35-54 years old in particular average nearly 19,000 miles each year. Realistically, a vehicle’s engine is likely to last between 7-9 years. However, computer components are expected to perform reliably for about five years.
After that, cars will start to see a steady stream of electronics replacements and repairs. Vehicles that have the deepest ties between technology and driveability could be hit the hardest in terms of costs. In terms of figuring out a new or used vehicle’s value, we need to consider both mileage and tech life span.
What older consumers understand is that the bare bones cars with sturdy Slant 6 engines of the 1960s and 1970s lasted far longer than today’s fancy computer-controlled AWD vehicles are expected to last. In terms of value, you may want to consider bypassing all the bells and whistles to consider some of the more low-tech vehicles being produced. These include:
- Hyundai Accent GS hatchback and GLS sedan
- Kia Rio LX hatchback or sedan
- Mazda Mazda3 iSV sedan
- Mazda MX-5 Miata Sport
- Mitsubishi i-MiEV
- Nissan NV Passenger Van
- Nissan Titan S King Cab and Crew Cab
- Smart ForTwo Pure Coupe
One of the more intriguing models on this list in the Smart ForTwo Pure Coupe. While a lot of people poke fun at this car, it only costs about $14,500 brand new. It’s short on technology, so you won’t have to worry about computerized components failing. But what makes it fascinating is that the life expectancy of the engine appears quite ambiguous. Some sources claim it will only get 60,000 while others are touting 100,000-plus. This makes it a solid car to buy new, but you’d be gambling if you bought one used based on mileage. Think of it as a very inexpensive 4-7 year car that won’t have you in a tech danger zone. Now consider that against the top “long-lasting” vehicle — the Honda Accord.
The 2016 Honda Accord sold for about $22,000 and is touted as one of, if not the longest lasting vehicles on the road. Topping 200,000 isn’t unreasonable based on previous years’ experience. But, last year the car maker caught tech-fever and started piling on the gadgets. It now has many fancy devices, including tablet-like touch screens, parking sensors, safety systems, and more. As mentioned early, the life expectancy of those items is unlikely to last beyond five years. Consumers may experience ongoing electronics replacements and repairs well before the car’s engine wears out. In terms of value, consumers may want to look at this car just like a Smart Car, because the potential for faltering technology could make you dump it in five years anyway.
Smart consumers have some new math to wrestle with these days. It’s important to consider cost and engine life against the age of the computer parts when deciding on a vehicle’s real value. But, you can always bypass fancy technology, and stick with the old math of cost vs. mileage.