Post by
landtodd »
https://forums.nicoclub.com/landtodd-u258.html
Mon Jan 13, 2003 6:58 am
Daedalus -- you don't miss a thing! Price comparison on the O2 sensors was with local dealer, who would charge $145 ea if only I were desperate enough to pay it. The local price changes according to how the Seminoles did last weekend, the phase of the moon . . . I think my dealer is in the business of making a new Infiniti appear more attractive by ratchetting up parts prices for old ones.
Fxjackso -- Dennis came up with a handy rule-of-thumb for estimating depreciation. I called it the three-year half-life. The average car loses half its value every three years. With some adjustment, that works pretty well.
Even gen-1 Q45s are still commodities, depreciating, their value governed by the larger commercial market. Sadly, you don't get anything in a commercial trade for solid maintenance or complete records, yet commercial transactions determine our cars' ballpark values. If the car goes forward and reverse, and doesn't emit too many suspicious noises or odors, appearance is what counts in a trade, not because car dealers are evil or stupid, but because appearance is what used-car buyers buy. (Generalizing, of course.)
I understand your point -- your well maintained car will be worth more to a knowledgable Q45 buyer, maybe 20% more than market, but the general price range is set by the commercial market and its 3-year half-life.
Three years from now, I expect my Q to be worth something like $2000 in a private-party sale (worthless in wholesale or trade-in), but if you're smart or lucky, you go off the beaten path and find educated buyers. Like NICO members! I expect a NICO member might pay $2400 for it, knowing what's been done and what's important.
After 10 years, the car is worth so little that we're starting to talk about nickels and dimes of depreciation, and it becomes academic. You're right -- hard to estimate. At 13 years old, the three-year rule says we're talking something like 6% of original value, so I admit to splitting hairs. My zero-miles cost of $5/day is an estimate, half of which is depreciation, but it rolls up into $150 a month, which might be something to consider when you're watching your nickels and dimes.
I'm convinced that depreciation is a real cost by two extreme cases, one hypothetical, one real.
Let's say the chain-guide problem was known in 1992. Let's say I buy my Q new for $40K in 1992, and decide to replace the guides myself that year. Because I'm forgetful, a novice, and so incredibly slow, the car sits half-completed for 10 years before I'm done! Sure I saved a thousand (or more) doing the job myself, but in the interim, the car has depreciated $35K.
If it could have been done professionally in two days for between $1500 (T3) and $4500 (my dealer -- Seminoles lost), then I would have gotten 10 years of use out of the car, and ended up in almost the same place, value-wise.
We all lose money on depreciating assets (cars) over 10 years, whether we drive them or not, but generally we put up with that because we get transportation in return. Spending money and getting nothing in return is just throwing money away, which we do any time the car is laid up.
I think accountants call it "opportunity cost."
True story -- a friend of mine decided in 1992 that he wanted a 10-year-old Mustang with low miles in 2002. He thought ahead and actually bought a new Mustang, put it in a garage, and waited 10 years. (I think he put 5000 miles on it.) What he got was a 10-year-old car for the price of a new one!
They're the same stories -- the car depreciates whether you use it or not. The only difference is in the reasons for taking the car off the road for an extended period of time.