There's a lot to think about when buying your next car. The auto industry is at a critical turning point as it transitions to electric drive. It's like 1900, when the head scratcher in the marketplace had to choose between a gas, steam or electric car. The discriminating chose the EVs -- they were quieter, more reliable, and didn't have to be cranked -- but the rapid advance of internal combustion soon made them obsolete. As early as 1915, electric cars had become the domain of elderly women (like Henry Ford's wife).
So here are some things to think about when making that important decision. It's just a car, you say? Well, your car is the most expensive thing you own, besides your house. Maximizing resale value is an important thing.
1. SUVs are on their way out. The book value of larger SUVs has plummeted in recent years, as crossovers have come to dominate the market. A two-year old Hummer would sell for a fraction of its original cost even if the brand wasn't headed for oblivion. Anything with less than 20 mpg on the highway is a dinosaur today. Plus, check it out on Craigslist -- the market is saturated with used SUVs, many of them put up for sale by unrealistic owners looking to recoup their investments. It isn't going to happen.
2. Consider a minivan. I know, only "soccer moms" drive vans. But they are more fuel efficient than SUVs, offer easier access and load capacity than other choices, and hold their value better. If you've held off from buying, say, an eminently practical Toyota Sienna because of the image thing, it's time to re-examine your values. Most of your style-conscious friends drive SUVs, right, so who's being the conformist here?
3. All hybrids are not considered equal. The honkin' Chevrolet Tahoe Hybrid costs $50,000, yet it offers only marginal fuel-economy benefits over the standard truck, and it actually uses more gas than the aforementioned non-hybrid Toyota Sienna (which is half the price). What's the point? A number of manufacturers offer either luxury or high-performance hybrids (Lexus, Mercedes, BMW) that fail to optimize fuel-economy benefits. The hybrids that make sense to me are smaller cars -- like the Prius, Honda Insight and Civic, Ford Fusion -- that combine aerodynamics, low weight and restrained interiors to maximize on-the-road mpg.
4. Electrics are coming. By the end of the year you'll actually be able to buy one of the plug-in cars you've been hearing so much about. On the market, though not in all U.S. markets, will be the Nissan Leaf (all-electric), the Chevrolet Volt (a "range extender" whose gas engine is there to make electricity), the Coda (a battery sedan) and at least theoretically, the Fisker Karma (an exotic plug-in hybrid that no one's driven yet). Should you be an early adopter? That's not a decision that will work for people who are risk-averse. As cool as EVs are, the pace of their acceptance into the marketplace -- and thus their short-term resale value -- is impossible to predict right now. It's also important that you have some degree of pioneer spirit, considering that you'll be exploring the new world of plug-in recharging, and dealing with a 100-mile range. All that said, I'm bullish on EVs and believe, firmly, that the auto industry is going electric. Buy an EV and you're unlikely to be left with orphan technology. You won't have a Betamax on your hands.
5. Consider car-sharing. As the new book Carjacked makes clear, car ownership actually costs us far more than we think. Most families have two, so that doubles the expense. One approach to your next car, then, is to not actually buy one. Car sharing services are membership organizations that charge small fees when you use the (usually small) cars they have scattered around at strategic locations. They're big on Internet reservations and smart card access. Zipcar, the largest U.S. car club, is expanding rapidly (and aggressively moving into Europe, for instance). Another option is Hertz Connect. There is ample documentation that shows you'll save money by paying for cars only when you need them. This is an option more for the urban dweller than the country squire, but even smaller cities now have car-sharing available. (There's also a new app to make ride sharing easier.)
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