Auto Repair Shops Thrive As Owners Keep Used Cars Longer

The global recession continues and as a result, millions of people are tightening their purse strings. One of the most noticeable recent trends is that more drivers are willing to keep their used vehicles longer. Auto parts stores and repair garages have reported a sharp increase in business over the past several months.

In this article, we’ll explore the reasons why motorists are driving their used cars longer. I’ll explain the costs of purchasing a new vehicle as well as how reliable auto parts can help you squeeze more mileage from your car.

The Cost Of Buying A New Vehicle

Most of us would like to think that our decisions at the dealership lot are based upon objective reasoning. That is, we “need” a new truck or SUV. We “need” the top-of-the-line GPS unit and stereo system. And saying no to the $500 alloy wheels would be ridiculous. By the time we drive off the lot, we saddled with hefty monthly payments that we’ll be servicing for the next several years.

Buying a new vehicle is expensive. While you may not need to visit the repair shop (hopefully), the cost of registration, taxes, and insurance are significant. Plus, the interest on your auto loan can add up to thousands of extra dollars.

This is the main reason people are holding onto their older models longer. It may cost a few hundred dollars to replace a water pump, alternator, or radiator fan, but it’s a small investment compared to purchasing a new model.

Longer Use Through High-Quality Auto Parts

Automotive parts are designed to last much longer today than they did years ago. While a car that was built in the 1980s might be expected to last 10 years, vehicles that are built today may last several additional years.

Of course, parts fail due to excess wear and tear. You may need to replace your transmission or engine at some point, especially if you drive a substantial number of miles each year. But, the replacement parts can last over a decade, reducing your annual cost of repairs and maintenance below the cost of servicing an expensive auto loan.

More Mileage For Your Money

Owning a new car can be invigorating. But, it can deliver a swift blow to your monthly budget. What’s more, your new vehicle will lose nearly half its value during its first three years. If your current car is less than ten years old, consider keeping it rather than purchasing a new model.

By investing in high-quality auto parts, you can squeeze more mileage without assuming a costly monthly payment. And with a little regular maintenance, you can enjoy reliable transportation without taking a devastating hit to your pocketbook.

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Pros And Cons For Trading In Your Car

After spending a few years driving your vehicle, it’s normal to want a change. The excitement you felt as you drove it off the dealership lot has dissipated. Now, each time you see a new model on the road, you might feel an urge to go car shopping again. If you decide to buy a new car, you’ll need to figure out how to offload your current vehicle. Your choices are limited to selling it yourself or trading it in. Below, I’ll explain the pros and cons of using your current car as a trade-in for a new model.

Pro: Tax Advantages

Whenever you buy a new or used car, truck, or SUV from a dealer, you’ll have to pay sales tax. Depending on the price of the vehicle, the sales tax can climb to hundreds – even thousands – of dollars. If you sell your current vehicle to a private party and purchase another model from the dealership, you’ll have to pay sales tax on the entire amount. On the other hand, if you use your current ride as a trade-in, its value will be deducted from the price of the new model. That lowers the amount of sales tax you’ll need to pay.

Con: Less Money

In nearly every case, you will be able to sell your vehicle to a private party for more money than you would get from trading it in to a dealer. The reason is partially due to the motivation behind the purchase. For example, a dealership wants to sell it to another customer in order to make a profit. To do that, they offer a lower trade-in value; the less they offer, the more profit they can make. By contrast, a private party isn’t interested in making a profit. They just need a reliable source of transportation.

Pro: Less Effort

Even though you stand to make more money by selling to a private party, doing so requires work. You’ll need to place an ad, field phone calls, and make yourself available to show your car to prospective buyers. Along with that, some people will request to have a mechanic test your vehicle. When you trade it in to a dealership, it’s as easy as haggling over the value, signing the paperwork, and handing over the keys. Less time and less effort.

Con: Ongoing Monthly Payments

As long as you’re maintaining your car properly, keeping it for a few more years is usually less expensive than trading it in for a new one. Most people don’t purchase a new vehicle outright, even when they use their current one as a trade-in. Instead, they negotiate the price and choose monthly payments. That’s expensive.

Long-time readers of my column will know that I’m a proponent of keeping your vehicle and replacing parts when necessary. Changing the oil every 5,000 miles and periodically replacing spark plugs, air filters, and other parts can keep your ride running smoothly over the long haul. Even if you need to rebuild the transmission or replace a head gasket down the road, you’ll still come out ahead.

Trading in your car offers advantages and drawbacks. If keeping it for a few more years isn’t an option, at least you’ll have the right expectations.

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