Can You Afford To Keep Your Car

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People often ask just how long they can expect a car to last – 100,000 miles? 200,000? Here’s the cold, hard truth: A modern car can last a long time, but at some point you may not be able to afford to keep it.

According to AAA, transmission repairs can cost between $2,000 and $4,000. Engine repairs are higher yet. Another source, National Auto Inspection Services, states that even air conditioning repairs often exceed $1,000.

Daunting Repair Costs
Those six-figure repair costs are pretty daunting, and one can only wonder how the average owner of a 10-year-old used car would handle them. In fact, a AAA survey (August 2011) found that one in four Americans could not afford to pay for a car repair of $2,000 or more.

Speaking from personal experience, I recently had to say goodbye to an old friend – just 6 years old and with 138,000 miles. Faced with a $5,000 repair bill, I decided to sell it “as is” and lease a new car for $215 a month. It just made more fiscal sense. And I’m thankful that I could qualify for the lease, unlike some who might not.

Looking toward the future, the situation may get worse.

The Little Civic That Could
Let me tell you about my good buddy, Dan, who has a Honda Civic with over 415,000 miles on it. Dan has given his Civic all manner of preventive maintenance and TLC. Sure, he’s had to replace an alternator or water pump from time to time, not to mention other components that he’ll replace on a proactive basis, since he has a pretty good idea how long these pieces last.

Dan’s 1988 Civic is a pretty basic vehicle, though. There’s no ABS or electronics to be speak of beyond some rudimentary engine controls for the throttle-body fuel injection and electronic ignition. The car doesn’t have power windows or power locks, and the instrumentation is pure analog. In short, there’s very little complexity to any of the components and systems. It fits my golden rule of new vs. used: Buy or lease a new car with all the bells and whistles that you can afford; on the other hand, buy the most basic used car you can live with because there are fewer things to break.

No Basic Cars
But finding a “basic” car is definitely getting harder. Part of the reason is government regulations, but a good part is also consumer demand. Even a low-buck Kia or subcompact Chevy offers navigation, traction and stability control, and a premium audio system. Go up the price/segment ladder to luxury cars, and multiple electronic control units regulate everything from security to climate control to lane-departure systems and blind-spot detection.

So what happens with today’s crop of cars when they reach 150,000 miles? It’s pretty likely that the engine and transmission, and even the airbags and ABS may continue to perform just fine with minimal maintenance. I’m not sure you can say the same about the body control unit or the fiber-optic network that communicates with the instrument cluster, or even the tire pressure monitoring system. People joke about airport limos with “check engine” warning lights providing constant dashboard illumination. But what if an engine or drivetrain fault makes the vehicle undriveable?

Junking “Good” Cars
Here’s my prediction: People will be junking used cars with perfectly serviceable drivetrains simply because they can no longer afford to repair the electronics. I can’t imagine a 2012 Honda Civic, particularly one with all the convenience options, going for 400,000 miles without some major electronics failure – something with a price tag that easily could exceed the value of the car.

Looking On The Bright Side…
The bright side of all this?

It will keep new car sales motoring along well into the future.

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