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Trade-in your gas guzzler? Maybe not

Globe and Mail Blog Post

Latest comment posted at 5:00 PM EST 08/09/08

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  1. David Smith from Toronto, Canada writes: Well people, when taking a road trip with the family, go state side, for me it's 120KM to the border and I fill up @ about 90c per litre, then food/hotel other attractions are much cheaper than what is available in Ontario(this is $$ i was gonna spend in Ontario anyways).

    As a bonus I have a full tank of gas when heading back home, plus cheap duty free booze and cigarettes. I make these long weekend trips 4x a year and I love it, I rarely buy over priced beer or smokes in Ontario. Why spend your hard earned cash at home and fuel these crazy price gougers.

    For me I do all my clothing shopping in the US, there may not be much savings, but it's my little way to send a message.

    Just got back,
    Full tank of gas 75L @ 90c
    3 shirts(valued @ $150 each), paid $120US for all 3
    2 24 of beer($24USD)
    2 Carton Marlboro $50USD

    plus some other stuff.....
  2. new beginning from Toronto, Canada writes: The title of your piece is about 'employee pricing' yet you don't really address the issue. From the title, I thought, maybe there is a scam going on here that you are going to reveal- no real savings for the great unwashed. But your focus is instead on trading your gas guzzler for something more economical on gas. There is a connection to consider, but it doesn't speak to the discount program as good, bad or indifferent on its own merit. Of course, this deal comes on as the new model year is unveiled and the discount isn't so much when you factor in the depreciation of an older model as opposed to the newest entry.

    Maybe they should sell the '08s at the one-year depreciated wholesale value to really give us a discount.
  3. dwight tanner from Canada writes: Trading a fuel inefficient for a fuel efficient does not help solve the greenhouse gas problem either, since someone else will buy and use the vehicle for its normal serviceable lifespan. The last time I looked, the average gas engined passenger vehicle lasted about 17 years and 300 km., before being retired from use.
  4. Nathan Cool from Vancouver, Canada writes: I can appreciate Cato's desire to save us money, but it'd be nice for him to mention that some people switch to fuel-efficient cars for the environmental benefits.

    I can afford a Hummer (and the gas), but I drive a scooter because the ice caps are melting.
  5. T. D. from Canada writes: the point missed, the depreciated value of a vehicle is based on factory cost. Here in Canada we pay a large premium over the US, so our depreciation amounts to far more than quoted in the article. Check the black book prices on a 1 year old vehicle, and you will see depreciation more in line with 53% after the first year. Yes more than half gone the first year. 18-52% of this is due to vehicles being priced higher in Canada.
  6. A Millbank from Nanaimo, Canada writes: What I don't understand is how is buying a new gas saving car is the ecological thing to do when there are plenty of good used cars around. The amount of ecological waste created by building a new car far outweighs the difference in the amount of fuel you'll save.
  7. Robert McEwan from Fort McMurray, Canada writes: You want the truth, you can't handle the truth!
  8. gender bender from Espanola, Canada writes: Excellent point about buying a car at the end of it's model year.Here is something else .If I buy a new car advertised at let's say 16k I MUST also pay another 1200 or so for destination charge!So how is the car for sale at 16k but I will really pay that plus another 1200 or so.Isn't that false advertising? The answer is yes.If I go to canadian tire and they have bike on sale for 100 dollars that is what i pay plus the tax there is no destination charge.How about a little truth in advertising by the car dealers or are we so used to this nonsense that we just accept it? Where is consumer and corporate affairs and why don't you jump on this Jeremy?
  9. slapdash dapoint from trawna, Canada writes: i just enjoyed the ads where on one side the dealership would be selling (off the top of my head) an 07 dodge 1500 with 15k k's on it for $22g's, and in the same ad across from it, a new 08 dodge 1500 for $12-$15g's(after all the incentives, of course).

    too bad they never thought of putting a small diesel(4BT anyone?) in the 1500 and pricing it for $12-15g's... i'm almost certain they would have flown off the lots

    :|
  10. Maynard Parabol from hamilton, Canada writes: David Smith from Toronto, Canada writes: Well people, when taking a road trip with the family, go state side, for me it's 120KM to the border and I fill up @ about 90c per litre, then food/hotel other attractions are much cheaper than what is available in Ontario(this is $$ i was gonna spend in Ontario anyways). As a bonus I have a full tank of gas when heading back home, plus cheap duty free booze and cigarettes. I make these long weekend trips 4x a year and I love it, I rarely buy over priced beer or smokes in Ontario. Why spend your hard earned cash at home and fuel these crazy price gougers. For me I do all my clothing shopping in the US, there may not be much savings, but it's my little way to send a message. Just got back, Full tank of gas 75L @ 90c 3 shirts(valued @ $150 each), paid $120US for all 3 2 24 of beer($24USD) 2 Carton Marlboro $50USD Well David I hope you enjoy visiting the US for more than the cheaper gas. Your driving 240 km to save maybe $25 on a fill up. Do you see how that defies logic? I know you were planning on going anyway but you didn't really save on gas. I just did 2 days in Michigan and I'd sure like to know where you find the food and attractions cheaper?? I had a moderate hotel and it was $90 on a weeknight. Some things may be slightly cheaper but add in the travel and the line-up at the border= not worth it for me thanks. I don't think your getting the deals you think you are. The other comments are right on the money. I bought a used Durango in 04 before the gas prices skyrocketed. Guess what it's worth now...nuthin. I'd lose $15K minimum if I sold it. That should buy me gas for at least 10 years so why would I sell it take the hit and get hit again by buying something that's still gonna need gas.
  11. Bob Seven from Edmonton, Canada writes: I have to disagree with the notion that a new 08 is a rip off compared to a new 09 sitting right beside. If they are priced the same, yes, that is a rip off. However, brand new 09's might not have the favorable finance rates and no rebates available either. manufacturers want to you buy the 09 while the 08's are still around becuase there is no discounting. I bought a 07 Infiniti G35 for about $12000 less than the 08 'sitting right beside it'. Is there still some depreciation, of course, but when you pay considerably less for the unit than it would have been 12 months ago, that isn't so bad. The dealer has had to write down the value of the asset anyway but is losing less money selling it at a loss than keeping it on the lot trying to sell it for more. Buying a new (or used) vehicle is not a tough thing. TV shows and advice columnists would like you to believe that you are being hosed every time you go to the dealership. Dealerships are a business and they make money by selling vehicles for a profit. Do you demand that you get your groceries at cost? Or how about the appliances you just bought - if Sears sold them for cost, how would they make money?? Same thing for a dealership. Margins on new cars are less than 10% - think about it the next time you buy a car and demand to have it at dealer cost! Oh, everyone has to pay the destination.....blame the government for requiring this to be disclosed. It was always there, just now you can see it! For the record I don't work for any auto dealerships, but I understand their business.
  12. dave charlston from toronto, Canada writes: Why does this cato guy and his sidekick even bother talking about the big three. Their all teetering on bankruptcy. What a waste of time
  13. Angry West Coast Canuck from Canada writes: Even better - buy a 2nd hand fuel efficient car and avoid the depreciation completely. If you've only purchased 2nd hand vehicles to avoid the depreciation, then the options really open up.

    It's really unfortunate that we can't get the decent European cars in this country. That would really open up some possibilities.
  14. SJ S from Kitchener, Canada writes: Now is the perfect time to purchase a used and domestic SUV or truck with the demand for them going down dramatically and with it, prices.

    As for gas prices, purchasing a $20,000 compact car doesn't make up for the $2,000 (approx.)/year savings in gas. Not too sure why people would purchase a smaller vehicle for marginal fuel savings.

    Smaller vehicles do produce less greenhouse emissions, but it's not what you drive, it's how far you drive it that counts. The "environmentally friendly" Toyota drivers who commute from Kitchener to Toronto, use a lot more fuel than I do in my Explorer commuting 8 km to work.
  15. Paul G from Toronto, Canada writes: In 1995 I bought a 1995 Sierra Pick-up and saved $1000 over a 1996 model. I still own the pick-up (looks like new) and I still saved $1000.

    ...
  16. Justin Credible from Toronto, Canada writes: Paul G makes a good point. Extra depreciation for previous year model is only relevant if you plan to resell the vehicle.
  17. Art Vandelai from Burlington, Canada writes: A study by CR, in fact, warns drivers that downsizing might be a very bad idea – that it will cost more in total ownership costs regardless of what you save at the pump. The experts at CR say consumers in most cases should keep their cars for four to five years to minimize the depreciation and finance charges.

    Well...the experts would say that buying a new car every 4 or 5 years minimizes costs. How self-serving.

    If a car doesn't last 10 to 15 years minimum, it's not worth buying.
  18. A reader from Canada writes: Why is it that Lexus, Acura, Infiniti, Mercedes, BMW and Audi have only cars that run strictly on premium fuel? Why isn't there a luxury class vehicle that will run on regular gas? Most of the cars that run on regular gasoline are bland both in the interior and exterior and Toyota is definitely in that category. The interior of the Toyota was much more upscale in the past.
  19. A A from Canada writes: Why are we talking about cars like they are investments?

    It's not called investing when you put money into an asset that rapidly depreciates.

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