Jerky

Even though we bought our TLs for mid to upper 30s (out the door) how much is it REALLY going to cost us after 5 years?

The True Cost to Own: This is all of the ownership and operation costs for five years which includes; Depreciation, Financing, Insurance, Taxes & Fees, Fuel, Maintenance, Repairs.

This does not include clear bras, stereos, wheels (does include tires), subwoofers, spinners, or any aftermarket toys.

True Cost to Own a new TL auto with Nav in Bay area is: $48,220 over the next 5 years!

This means that your car including:
-Depreciation (Wow we lost 8000 dollars off first year)
-Financing
-Insurance
-Taxes & Fees (very high the first year)
-Fuel (on average $1,587 a year)
-Maintenance
-Repairs



I hope this is insightful for all, as you need to set aside some money in addition to your loan and insurance to anticipate additional costs in future.

The resale value after 5 years is very high as well, it's about 50%...that's one of the higher resale values of cars in the industry..

Jerky's lecture: Don't think that I am trying to say that cars are an investment, as they are not, they are a sunk cost. which means you get very little return on your money. basically, its a very expensive (but kick ass) toy! Also, if your young and starting your career, I really hope you got a house/condo before buying a nice car. Don't get greedy, as getting a home and equity will make it easier to get lower rates on car loans in the future! If you're just a spoiled kid, just ignore my last sentence...

See for yourself here:
http://www.edmunds.com/apps/cto/intro.do

Any comments?

Stewie

You really need to compare the TCO with other, similar vehicles.
We all know true cost is higher than the purchase price but Acura generally has a lower TCO than most competitors.

wallaceoh

Stewie,

Jerky, I agree with Stewie in that we need to compare with other vehicles. Not to mention, being California based, your TCO is a lot more than mine in Ohio. Even a Volkswagen Beetle in California will run you almost $34K according to Edmunds. Geography will drastically change things on insurance, state fees, gas prices, etc. If I put in my current zip code, I come up right at $43K even.

I think you're right to set some money aside, but I knew that going in and don't regret one bit. The car is just too cool. Thanks for the advice!

Jerky

Im not going to post every single car out there to compare, or even do it by location, that's why I provided the link, you can do it yourself and share with us what your TCO is:

http://www.edmunds.com/apps/cto/intro.do

In any case, this post was informational, and to get some people to think about the real costs before jumping into debt. Do I sound old yet?

Anyways, let me know if this helps anyone think about it, im sure there are some kids out there that don't know what TCO is...

Type S Lady

Jerky, that was very imformative. Thanks alot for that info!

Doctored5

The Edmunds guide is useful & I looked at it when I was considering cars. Cars are a consumption good, not an investment & the TL is a luxury item, not a necessity for most of us. However, my assessment of it vs. the Lexus 330 was that the depreciation on the TL would not be as bad as it was historically, since there was no history on the TL. The fact that it was difficult to find & selling for around list told me that it would work out to be a better deal.

wallaceoh

You're absolutely right. And indeed thank you for posting. It is appreciated.

lindros2

I disagree with some of this.

First of all, how is our TL going to cost $382 / $664 / $613 in maintenance over the first three years? After one year and 10,000 miles I've paid exactly $50 in maintenance.

Second of all the depreciation number is off. Acura had my car at 57% after 36 months, 55% after 39 months and 55% after 42 months (yes, same for 39/42). I can't understand how losing 43% after three years is considered "high" by Edmunds' book when the Taurus (another full-size sedan) LOSES 81% AFTER 3 YEARS.

Fuel is going to be a function of how much (and aggressively) you drive, insurance is going to depend on the individual (could range from $600 up to $4000), and taxes/fees are also a huge variable.

So at the end of the day, factoring in everything, it looks like I'm paying about $8140 per year on a three year lease. Financing really would have just moved the money up front (down payment) and I would have received a lower interest rate (4% vs. 8%).

-josh

Jerky

Lindros, I looked at the Edmunds site, and what they do is take averages from across the average and use statistical models. You're absolutly right, the final TCO per car/per person/per location/per situation will greatly vary... But I think that they were only providing some general statistics.

Are there any other financial gurus out there that can jump in this thread and set me straight (FYI im a web marketing guy not a finance guy, your input is helpful)

tasdisr

true cost to own in my area is $43813.00

clocks

Edmunds rates depreciation on a 04 TL being worse than average for it's class. Why is this? The older TLs held their value pretty good. Also ALG.com only rates the TL 3/5 stars.

EluSiOn

in my area, my TL depreciate $6700