Real costs of owning a highly depreciated luxury car?
Discussion
I'm trying to help my friend to buy a car at the moment. He is doing something I talked myself out of a couple of years ago.
He wants to buy an 8 years-old luxury SUV, which would have been about £80k new, for up to £20k today. This gets a car with some balance between spec levels and mileage from 70-105k.
We've looked at 3 cars, and he looks at them like they should be perfect because it's a lot of money for him.
I'm looking at them like it's lost 75% of it's value, how much of it's reliability and capability is gone? Is something expensive about to happen? I figure an £80k RRP car will throw up much bigger bills than a £30k RRP car. If it has sophisticated electronics or suspension that changes at the touch of a button, that's a lot of things to go wrong.
These cars look like amazing bargains, but do you need to have the wealth level of an £80k new car buyer to comfortably run them? What's the reality of ownership?
He wants to buy an 8 years-old luxury SUV, which would have been about £80k new, for up to £20k today. This gets a car with some balance between spec levels and mileage from 70-105k.
We've looked at 3 cars, and he looks at them like they should be perfect because it's a lot of money for him.
I'm looking at them like it's lost 75% of it's value, how much of it's reliability and capability is gone? Is something expensive about to happen? I figure an £80k RRP car will throw up much bigger bills than a £30k RRP car. If it has sophisticated electronics or suspension that changes at the touch of a button, that's a lot of things to go wrong.
These cars look like amazing bargains, but do you need to have the wealth level of an £80k new car buyer to comfortably run them? What's the reality of ownership?
Things go wrong with age and higher mileage. You have to be proactive in thinking about replacing things before they fail and be prepared to replace when they do. I've ran older Range Rovers bought with 155k and 175k miles and you won't get away with a basic inspection and oil change at service time unlike with new cars. Get on the owners forums and read around.
Parts costs and maintenance will remain expensive.
Whilst not an SUV, my everyday Audi is a similarly expensive to buy new car, and is now 20+ years old - two front brake discs and a set of pads - £ 677.94 plus fitting.
Price up some parts or service jobs needed at 60,000 - 100,000 miles and decide.
Whilst not an SUV, my everyday Audi is a similarly expensive to buy new car, and is now 20+ years old - two front brake discs and a set of pads - £ 677.94 plus fitting.
Price up some parts or service jobs needed at 60,000 - 100,000 miles and decide.
In my experience even newish big cars can throw big bills (the proper extended warranty on a X5 is bouncing off 2k pa) even on a newish one
Just to give an idea my last X5 needed at 3 years and 57K
3rd set of tyres (21s) decent make £1150
Rear pads and discs circa £500
Major service circa £600
Yes you can do it cheaper using back street garages but these are big heavy complicated machines and not all garages are that good on these cars
Mine dropped from 83k to 39K in 34 months and the trader who brought took 6 months to sell it on and probably made little (it need the above plus the usual scuffs wheel refurb etc). He advertised it for 45 including the worlds worst fake M sport bodykit!
Just to give an idea my last X5 needed at 3 years and 57K
3rd set of tyres (21s) decent make £1150
Rear pads and discs circa £500
Major service circa £600
Yes you can do it cheaper using back street garages but these are big heavy complicated machines and not all garages are that good on these cars
Mine dropped from 83k to 39K in 34 months and the trader who brought took 6 months to sell it on and probably made little (it need the above plus the usual scuffs wheel refurb etc). He advertised it for 45 including the worlds worst fake M sport bodykit!
What were the three cars?
I'd hate buying in this range because it's enough that you can't give up on it if you buy a problem one, the warranties will be dubious, not all "they all do that" issues will be known yet, possibly not a huge range of aftermarket/cheaper bits.
For me as the more you drift older the more you need to research the hell out of each model you are considering, if you buy in this range and get 'surprised' by a know issue that's on you (honestly I would be loathe to help anyone buy in this range as it's hard to make guarantees and the friend is likely seeing your input as a subliminal guarantee or assurance).
I'd hate buying in this range because it's enough that you can't give up on it if you buy a problem one, the warranties will be dubious, not all "they all do that" issues will be known yet, possibly not a huge range of aftermarket/cheaper bits.
For me as the more you drift older the more you need to research the hell out of each model you are considering, if you buy in this range and get 'surprised' by a know issue that's on you (honestly I would be loathe to help anyone buy in this range as it's hard to make guarantees and the friend is likely seeing your input as a subliminal guarantee or assurance).
Thanks for all the replies - every one of them super-helpful! I've gained some insights that I was groping around missing for ages.
So it seems the sweet spot for these cars is either someone who can do their own work (and hopefully enjoy it), or someone that can afford it as a second car that they maintain proactively while not piling on the miles or needing it for a main vehicle.
My friend wants a 2017-18 Mercedes GLE. He has quite practical reasons for it, this isn't about ego or status. I think my role is as balance, to try to help him avoid making a bad buy.
This has solved a puzzle of my own. I have a BMW E89 Z4 (as a daily, yes I'm stupid), and for family reasons I really ought to have a car with more than 2 seats. A couple of years ago I got excited at the apparent value of a 640D convertible. It seemed mad to me that they were the same or less than a 420i convertible. I was lured by the apparent bargain. But I knew I would be wrecked when it went wrong.
But the 420i price includes the value of lower repairs and maintenance. And that draws a larger audience of potential buyers, which strengthens the prices further.
Bringing it back to the GLE, there is a supply of £20k 80k miles 2017-18 cars. If you want a C250D estate, you might pay £15k for a car with the same miles and age. Its a bit cheaper, but not much, for a car that may have cost 50% the RRP of the GLE back in 2017. The value is in actually being able to run it without going broke, I think.
So it seems the sweet spot for these cars is either someone who can do their own work (and hopefully enjoy it), or someone that can afford it as a second car that they maintain proactively while not piling on the miles or needing it for a main vehicle.
My friend wants a 2017-18 Mercedes GLE. He has quite practical reasons for it, this isn't about ego or status. I think my role is as balance, to try to help him avoid making a bad buy.
This has solved a puzzle of my own. I have a BMW E89 Z4 (as a daily, yes I'm stupid), and for family reasons I really ought to have a car with more than 2 seats. A couple of years ago I got excited at the apparent value of a 640D convertible. It seemed mad to me that they were the same or less than a 420i convertible. I was lured by the apparent bargain. But I knew I would be wrecked when it went wrong.
But the 420i price includes the value of lower repairs and maintenance. And that draws a larger audience of potential buyers, which strengthens the prices further.
Bringing it back to the GLE, there is a supply of £20k 80k miles 2017-18 cars. If you want a C250D estate, you might pay £15k for a car with the same miles and age. Its a bit cheaper, but not much, for a car that may have cost 50% the RRP of the GLE back in 2017. The value is in actually being able to run it without going broke, I think.
Edited by ApexAddict on Wednesday 1st July 19:24
Pulse00 said:
What about an 8 series?
I had the idea they depreciate like mad too? But I would personally love one. Yesterday I saw a real 8-series, an 840 V8 from the 1990s, in absolute mint condition, really made my day.Mar5hall said:
Surely a Lexus is a safer buy? I guess they don t depreciate as much for a reason!
Good idea! I guess our lack of familiarity is a barrier, we have both had mostly BMWs in recent years.This reminds me though, when I had a Toyota, and the dealership also had Lexus. When I couldn't get through to Toyota on the phone, I'd dial the Lexus number instead, always picked up quickly by someone who didn't mind helping a confused customer.
I don't mind having a look at simple sub £3k run around cars for friends to check over the basics, however, with my average (and I'd argue most peoples) knowledge, I would draw the line at looking at 7-10 year old, £80k retail when new, luxo barges, if that friend is bringing me along as "the car guy". Don't know if that is the setup In your situation? If so ...
If I bought an £80k-£100k, 10 year old luxury car with high mileage and a few months down the line I was presented with a £3-5k bill from a specialist for faults/worn out parts, then I would not bat an eyelid.
Given that your friend is expecting a cosmetically "as new" car for 1/4 of the price, then I think the reality of the above might come as a shock to them. So, a bit of advice, make them aware of the potential costs and don't make any buying decisions or even hint at what they should do, if you value the friendship.
If I bought an £80k-£100k, 10 year old luxury car with high mileage and a few months down the line I was presented with a £3-5k bill from a specialist for faults/worn out parts, then I would not bat an eyelid.
Given that your friend is expecting a cosmetically "as new" car for 1/4 of the price, then I think the reality of the above might come as a shock to them. So, a bit of advice, make them aware of the potential costs and don't make any buying decisions or even hint at what they should do, if you value the friendship.
Edited by MattsCar on Wednesday 1st July 20:39
MattsCar said:
I don't mind having a look at simple sub £3k run around cars for friends to check over the basics, however, with my average (and I'd argue most peoples) knowledge, I would draw the line at looking at 7-10 year old, £80k retail when new, luxo barges, if that friend is bringing me along as "the car guy".
Came here to post much the same - you risk being on the hook in the future when it develops an inevitably-expensive fault.My concern here is that his £20k is not just a lot of money to him, but all he's got, and a couple of faults, again inevitable on a complex near-decade-old car, will clean him out. And it'll be your fault because "you said it was a good one".
Years back I was selling my car, a middle-aged luxobarge, and a friend expressed interest in it. After some chat, it moved to finding ways to talk him out of it, as he was essentially looking for me to provide a cast-iron guarantee it was perfect and would remain so. f
k that. Telling him that he needed to keep at least £1k a year on hand to cover any repairs made them lose interest.So long as you have the money to maintain the car, I think it makes perfect sense. But you have to be honest with yourself about that. If you’re buying what was an £80k car, your budget to maintain it will need to be substantially more than the budget required to maintain a car with a list price of £30k.
My current cayenne coupe is a 2022 car that cost almost £150k (the 1st owner went nuts with the options list). I bought it recently for half that. It’s like new, and has the all important Pork warranty. As such, I don’t really worry about the bork factor. I just budget for petrol and the OPC servicing.
Maybe tell your pal to speak to a good Indy about the running costs before diving in?
My current cayenne coupe is a 2022 car that cost almost £150k (the 1st owner went nuts with the options list). I bought it recently for half that. It’s like new, and has the all important Pork warranty. As such, I don’t really worry about the bork factor. I just budget for petrol and the OPC servicing.
Maybe tell your pal to speak to a good Indy about the running costs before diving in?
If you can find a decent, honest and competent mechanic it doesn’t need to be that expensive, OK parts can be, although parts can often be acquired from reputable aftermarket places. However labour costs will be substantially lower. I guess it’s also important to find a well maintained moderate mileage example of whatever takes your fancy. I bought an 8 year old RS6 C6 and ran it for 8 years and never really had scary bills, same for a D2 S8 I bought at 8 years old and kept it until it was 22 years old. Also bought an 8 year old Maserati GT and ran that for 5 years, again without any scary bills. Currently running a D4 S8 that I bought 2 and a half years ago when it was 8 years old for about a quarter of its new price and again been ok with bills so far. Some repairs require specialist tools/software etc but there are many Indies out there that have access to that sort of stuff where their labour rates are a fraction of main dealer prices. The joy of driving around in a luxury car like the S8 which cost less than new white goods hatchbacks is worth the risk IMHO and should never be underestimated.
It's a great idea imo. Could buy a 2025 model top of the ipace hse which was £80000 and now available for under £30k. Will still be under warranty too and being at the end of the model run, will be far more reliable than the earlier cars. I think they're one of the biggest bargains this decade.
Grant Urismo said:
I'd be a lot happier going down this route with an EV than an ICE car, there's a lot less to go wrong, and lot less to service. 20k would get your friend into a 4 year old EQC.
The market seems to believe the opposite from what I can see. Certainly for top end tin. I believe they’ve even coined a phrase for it “hybrid anxiety”.Gassing Station | Car Buying | Top of Page | What's New | My Stuff