Buy New or Fix Old?

"I'm going to buy a new car; I'm sick of paying for repairs."

You hear this rationale presented all the time by people preparing to buy a new vehicle. Many people claim they will actually save money by getting rid of their current vehicle and buying a new one. Repair costs are eating them up, so they truly believe shifting to a new vehicle will be a financial boon, but does their thinking make any sense? A new study by the Automobile Club of Southern California indicates that buying a new car to save money is just a pipedream.

Don't get us wrong; we think there are a lot of good reasons to buy a new vehicle -- additional safety, better efficiency, more carrying capacity are among them -- but thinking you're going to save money by purchasing a new vehicle is a fallacy. The numbers don't back it up.

The Auto Club found the average driver of a new car spent between $8,000 and $10,000 on auto finance payments, insurance, gas, and other auto-related expenses last year. Looking closer at the figures it said that nationally, consumers owning a 2001 model-year car who drove 15,000 miles in the year paid an average of $7,650 or 51 cents per mile for the privilege. Those who drove their cars 20,000 miles a year paid an average of $9,160 or 45.8 cents per mile. Of course, motorists living in Southern California paid slightly more in each instance, but then they have all that sun and warm weather to deal with 365 days a year.

By way of comparison, the Auto Club also looked at the cost for owners of 1996 models whose cars were paid off. The results were illuminating. Drivers who logged 15,000 miles a year paid just $4,126 or 27.5 cents per mile. Those who put in 20,000 miles for the year got by even cheaper on a per-mile basis: 26.3 cents or a lump sum of $5,266.

Since new cars presumably have much lower repair and maintenance costs than older cars, how can this be?

The answer is that repair and maintenance costs are actually a relatively small portion of overall ownership costs -- a highly visible portion, yes, but a small portion. And the same thing can be said of fuel and lubrication costs. Some folks actively seek out higher fuel economy vehicles in an attempt to save money, but figures indicate if they are buying a new car to get better economy they are fooling themselves.

While gasoline and repair costs are in our face and thus get our attention, the biggest ownership costs for new cars in the first year of ownership are depreciation and financing. Once the car is paid off, the financing charges vanish and, at the same time, depreciation slows markedly. So even though repair and maintenance costs do increase as a vehicle ages, they are more than offset by declining depreciation costs and the absence of financing.

The bottomline answer: the cheapest way to enjoy automotive transportation is to keep it and fix it or, in stock market terms, buy and hold. The only better bet is borrowing someone else's car... but please do it with their permission.

The author of The Complete Idiot's Guide to Buying or Leasing a Car, Jack R. Nerad says the most economical car he ever owned was a 1965 Oldsmobile 442, which he bought for $600 and sold three years later for $600.

You Can Get Satisfaction

Some say you can't always get what you want, but you just might get what you need. True as that is in some areas of life, it is far from the truth in the automobile business these days. The fact is, this intensely competitive global business is offering its customers the best products ever. In other words, you can get what you want and what you need.

As vivid proof, take the most recent study of consumers' satisfaction with their new vehicles, as released by noted automotive consulting firm AutoPacific, Inc. The firm's VSS (Vehicle Satisfaction Score) study is an industry benchmark for objective new vehicle buyer and lessee satisfaction. VSS ratings record satisfaction with vehicles overall, as well as in 43 specific areas related to each vehicle's operation, comfort, and safety, plus the purchase/lease experience. The ratings reflect input from over 34,000 owners of new vehicles acquired September-November 2001. The survey was fielded in February of this year, so the results represent opinions formed after fewer than six months of ownership and with the acquisition process still relatively fresh in consumers' minds.

With this as background, it is not surprising that two brands known for both vehicle quality and painless purchase/lease processes share top ratings in 2002, namely, Cadillac and Lexus. Both have been in this exalted position before. Cadillac was top-rated in 2001 and Lexus in 2000.

The individual vehicle model registering highest overall satisfaction for a third consecutive year is Lexus' LS-series sedan, now called the LS 430. That ranking came as little surprise, but the big surprise, at least to those who have not had their index finger on the pulse of the industry, is that the highest-rated truck is a Cadillac, namely the extensively upgraded Escalade sport utility vehicle.

The individual segment leaders come from a wide cross-section of vehicle manufacturers from around the globe. The Toyota/Lexus juggernaut was the top scorer in category wins with the Lexus ES 300, Lexus SC 430, Toyota Prius, Toyota Highlander, Toyota Tacoma and Toyota Avalon joining the Lexus LS 430 at the top of their individual segments. (The Avalon and Highlander gained top marks in ties with, respectively, the Cadillac DeVille and Hyundai Santa Fe.)

While the Toyota triumph was not unexpected, what was less expected was the strong showing by much-maligned General Motors. GM scored segment victories with the aforementioned DeVille, as well as the Cadillac Escalade and Chevrolet Silverado HD. Perhaps even more surprising was the emergence of Hyundai/Kia as a force to be reckoned with in vehicle satisfaction. Hyundai scored segment wins with its Sonata mid-size sedan and Santa Fe SUV, while Hyundai Motor Group-controlled Kia took top honors in the hotly contested minivan segment with the recently introduced Sedona.

Other segment leaders were the Volkswagen Beetle (compact car), Nissan Altima (premium mid-size car), Mercury Cougar (sporty car), and Volvo V70XC (all-wheel-drive sport wagon). Among trucks the Honda CR-V was the highest-rated compact SUV; the Ford Excursion was the top large SUV; and the Dodge Ram 1500 Quad Cab was the best four-door pickup.

Obviously these days buyers have the choice of a great variety of highly satisfying vehicles from a number of manufacturers. Now that's what the car buyers needs.

Villeperce, France-based Tom Ripley knows more than a little about satisfaction, having studied the automobile business and the human condition for more than three decades.

Here Comes Summer, Part II: Los Angeles to La Jolla

At first glance, Los Angeles seems to be such a huge megalopolis that the chances of encountering natural beauty are nearly nil, but that couldn't be further from the truth. Instead, by escaping LA's traffic-clogged freeways to take what the locals call "surface streets," you will discover both a great deal of natural beauty and man-made charm.

Newport Beach and Balboa Island lie less than 50 miles from downtown Los Angeles, yet these charming summer communities have the feel of a New England summer resort. Car ferries make the three-minute trip from Newport to Balboa in endless procession throughout the summer, and Balboa can actually be reached by a bridge from its "backside," but still Balboa somehow retains the charm of a resort island, complete with high-class eateries and laid-back bars.

From Newport, it's just a quick hop down Pacific Coast Highway to Laguna Beach, which looks down from high ocean cliffs onto great beaches below. There, art galleries exist side-by-side with surf shops in a quintessential California juxtaposition. Once a hideaway for the Hollywood stars of another era, Laguna is now figuratively closer to the mainstream than ever, but it still retains its allure. Main Beach Park is a popular summer gathering place for sunbathing, watersports, and beach volleyball. From the park south, art gallery after art gallery beckons, and a great watering hole is the bar in the popular Surf and Sand Hotel.

South of Laguna are Dana Point, named after Two Years Before the Mast author Richard Henry Dana, and San Juan Capistrano, where the swallows return every spring. Dana Point offers an attractive pleasure-boat harbor surrounded by "view" restaurants, while San Juan Capistrano is a more historical destination that is home to the venerable Mission San Juan Capistrano founded by Father Junipero Serra.

After clearing the Camp Pendleton Marine base, which occupies what would otherwise be prime coastal real estate, Carlsbad, Encinitas, and Del Mar beckon. Carlsbad is small-town America personified with one exception -- it contains some of the best beach frontage on the West Coast. Encinitas now incorporates what used to be the four individual towns of Leucadia, Olivenhain, Cardiff-by-the-Sea, and old Encinitas. Each has its own flavor, and each offers its beautiful, "secret" beaches that are largely unused by non-locals.

Del Mar, of course, is much more well-known. Like Laguna Beach, it owes some of its fame to Old Hollywood, whose stars founded and frequented its famous horse racing track. More exclusive than its neighbors to the immediate north, it still retains its own small-town flavor, and it, too, offers stunning beaches to those visitors who seek them out.

Just a short drive from Del Mar, La Jolla also has an air of laidback snootiness that can only be found in California. It's a place where penniless beach bums whose only goal in life is to surf every day mix seamlessly with the moneyed set. La Jolla Cove is a picture postcard of a beach that happens to be within a short walk of the village's attractive downtown area, where you can find all the luxurious shops and exquisite eateries your credit card can bear. Enjoy!

Here Comes Summer, Part I: Lake Michigan's Eastern Shore

Is there anything better than filling up your vehicle with a full tank of gas, stocking up on some road food and heading off on vacation? If there is, I can't think of it. The right car, the right company and the right piece of plastic with a high credit limit can spell fun in any country -- and especially in the good old USA where we have so many great places to go. In fact, this country offers an embarrassment of riches when it comes to vacation offerings. Here's one of my favorites, which happens to be a hop, skip and a jump from Chicago. Check back next week for a destination right near Los Angeles. Enjoy!

Lake Michigan's Eastern Shore

The Wisconsin side of Lake Michigan offers its own bucolic beauty, but I can't hide my partiality for the lake's eastern shore. The prevailing west winds have, through the ages, created beautiful beaches and breathtaking sand dunes all along the western edge of lower Michigan, and there is no better season to drink in all their riches than summer. After heading north out of Chicago on I-94, follow 196 until it becomes Highway 31, which will be your route of pleasure for about 200 miles, all the way to Petoskey. The first pleasant stopovers on the route are the artists' communities of Douglas and Saugatuck, home of the slowly fading majesty of the SS Keewatin, a rare reminder of the days when large steam-powered vessels carried passengers throughout the Great Lakes region.

Up the road is Holland, a town that takes its name seriously by playing up its Dutch antecedents. Among the town's attractions are a 230-year-old windmill, the recreated "Dutch Village," and the DeKlomp Wooden Shoe Factory. Grand Haven and Muskegon are pleasant lakeside towns that offer attractive beaches and pleasure boat harbors giving anglers excellent access to Lake Michigan's sport fisheries. The scenery just gets better and better as you cruise leisurely to Silver Lake, where tall dunes to the west separate Lake Michigan from the smaller inland lake that provides great recreational opportunities. Take the opportunity to get out of your vehicle and climb into one of Mac Woods' expertly piloted dune buggies that have been plying the southern reaches of Silver Lake State Park for more than half a century for a ride you won't forget.

A short drive up 31, Ludington offers a state park with miles of beaches and still more miles of hiking trails through forests and dunes. Slightly farther north, Manistee is the gateway to one of the Midwest's most scenic wonders - Sleeping Bear Dunes National Lakeshore. According to the Chippewa, the area's largest dune, once topped with pines so that it resembled a giant bear, was the mother of two nearby islands, North and South Manitou, the Sleeping Bear's cubs.

Still farther north is the tiny fishing village of Leland, which is still the best place to buy hardwood-smoked Lake Michigan whitefish and trout. From there it is but a short journey to Traverse City, a veritable metropolis compared to many of the other towns nearby, with terrific restaurants, protected beaches and a wide variety of pleasant hotels.

After a slight jog east out of Traverse, the route turns north again to Charlevoix, a village that has become an enclave for the rich and not-so-famous. Its snug harbor and understated downtown are desired for destinations for the many cruising sailors who frequent Lake Michigan in its short summer sailing season. Petosky, a favorite of Ernest Hemingway, among others, has a similar feel, and its Gaslight District is a crowded but happy place to be on a warm summer night.

Car Care Saves Cash

These days, who wants to spend more money than they have to on anything? Nobody I know. Yet hundreds of thousands of Americans spend much more on car repair than they need to simply because they don't do the little things to maintain their vehicle properly. And when you put off the preventive maintenance that your car needs, it can hit you hard in the wallet. Ouch!

Sadly, many drivers today regard maintenance as an unneeded and unwanted expense. And while today's vehicles require less on-going maintenance than ever before, "less" doesn't mean "none." Even the most sophisticated vehicle on the road today still requires basic maintenance that will prolong its life measurably.

You want proof? According to AAA research, more than five million breakdowns could be avoided each year if motorists performed a simple inspection of their tires, belts, and hoses. That's pretty basic stuff, folks, but those items are much less likely to be looked at these days than they were decades ago because of the almost universal switch to self-service gasoline. That routine under-the-hood look that used to take place with every full-service fill-up just doesn't happen these days.

According to the Car Care Council, the typical driver should budget approximately $60 a month for preventative maintenance of their vehicle. While performing regular preventative maintenance may seem costly and inconvenient, that $60 a month could well turn out to be the best investment you could make.

"The consumer should be proactive, not reactive, in the care of their car," said Joel Burrows, vice president of training and research development for Precision Tune Auto Care, a nationwide provider of preventive maintenance and repair. "For example, fluids should be checked every time you have the vehicle serviced, and oil should be checked every time you fill the tank with gas."

While that's wise advice, when is the last time you checked your oil? Or checked the air pressure in your tires? In this busy workaday world it always seems like next time is the right time to perform these rudimentary duties, and next time never seems to come.

In addition to checking fluids and tire pressure, it is also essential to make sure that the air filter is cleaned, engine and chassis are lubricated, battery terminals are clean and spark plugs are in good condition. Another simple tip is that you should never run the fuel tank dry. When fuel is pumped into a dry tank, there is a higher chance of getting oxygen, moisture, and deposits into the fuel tank. Plus, it's usually a long walk to the nearest gas station, no matter where you end up stranded after running out of gas. Let's face it, a cold, rainy night is not the time to start your much-needed exercise program.

If you have any questions about what maintenance items you should perform, a book filled with easy answers most likely resides right in your glove compartment. Probably it is untouched, still in its plastic folder. Now, it's hardly the scintillating reading that my colleague's book, Fatal Photographs, is, but the price is right and a quick perusal is almost guaranteed to save you cash.

"Car owners have to take it upon themselves to read the manual," said Burrows of Precision Tune Auto. "If every consumer actually read their manual, they would be much more aware of basic precautionary maintenance, which would save them money in the long run."

If you put off performing preventative maintenance because you think it's a way to save money, think again.

"A major mistake car owners make is assuming that the purchase price of the car is the only amount of money they'll ever spend on it," Burrows said. "A car is no different from the human body, in that it has to be maintained from the day you are born. The automobile, from the day you start driving, it begins destroying itself."

Okay, your car might not be drinking, playing cards and chasing women, but it does live a hard life nonetheless. So a little TLC can go a long way in helping your chariot last longer, and remember, each year you can nurse along your current car rather than buying a new one can save you $10,000. That's a pretty good return for a few hundred dollars in maintenance costs each year.

Cleveland-based auto journalist Luigi Fraschini is a firm believer in preventive maintenance. Unfortunately, he reports it hasn't worked well on his hairline.