How to beat depreciation

Ditzy_Mitzy

I had an idle look at the classifieds recently and noticed that prices for early to mid 2000s stuff, say pre-2008, seem to be firming up.  I suspect, but don't know for definite, that this is caused by more recent stuff simply being too expensive for the average, budget-conscious second hand car owner to run.  Back in those days a car came with enough modern niceties to make driving effortless, but fewer of the eye-wateringly expensive ultra-modern electronic gadgets that don't actually make the car function better as a car, all said and done.  Things like £400 LED headlight units and £500 plus monitors in place of instrument panels.  My car is that age and maintenance is very cheap.  It's got normal lightbulbs and a conventional instrument panel, but is fitted with air-conditioning, power steering, electric windows, remote locking and so on.  
Engines, too, have changed a lot.  In the early 2000s it was still possible to buy ordinary cars with larger displacement normally aspirated petrol engines.  Such engines drink a bit more fuel but they last.  Newer stuff, which tends to be small displacement, high power and turbocharged, won't have the same longevity.  High horsepower per cubic inch/litre is great in a racing car that's looked after by a team of mechanics but not so good in a rep's car that's looked after when he can be bothered to.  
I think that 2000-2010 was a high point.  Good 1990s designs such as the Ford Focus and Mondeo, the old 3 Series and the Toyota Corolla and Avensis were refined and modernised as much as they needed to be and, as a result, became reliable.  After 2010 (or thereabouts) things got too complicated.  The market seems to be responding to that, meaning these cars have settled on a sort of floor value and probably won't depreciate too much further.  It doesn't matter if the seats are a bit dated if everything's still working.  A more modern second hand car can't compete if, when turning the key, the first thing confronting the driver is a load of dead instruments and warning chimes.  

JustAnotherSaver

If you're worried about depreciation then you're spending too much.

imo.

AdrianC

Ditzy_Mitzy said:

I had an idle look at the classifieds recently and noticed that prices for early to mid 2000s stuff, say pre-2008, seem to be firming up.  I suspect, but don't know for definite, that this is caused by more recent stuff simply being too expensive for the average, budget-conscious second hand car owner to run.  Back in those days a car came with enough modern niceties to make driving effortless, but fewer of the eye-wateringly expensive ultra-modern electronic gadgets that don't actually make the car function better as a car, all said and done.  Things like £400 LED headlight units and £500 plus monitors in place of instrument panels.  My car is that age and maintenance is very cheap.  It's got normal lightbulbs and a conventional instrument panel, but is fitted with air-conditioning, power steering, electric windows, remote locking and so on.  
Engines, too, have changed a lot.  In the early 2000s it was still possible to buy ordinary cars with larger displacement normally aspirated petrol engines.  Such engines drink a bit more fuel but they last.  Newer stuff, which tends to be small displacement, high power and turbocharged, won't have the same longevity.  High horsepower per cubic inch/litre is great in a racing car that's looked after by a team of mechanics but not so good in a rep's car that's looked after when he can be bothered to.  
I think that 2000-2010 was a high point.  Good 1990s designs such as the Ford Focus and Mondeo, the old 3 Series and the Toyota Corolla and Avensis were refined and modernised as much as they needed to be and, as a result, became reliable.  After 2010 (or thereabouts) things got too complicated.  The market seems to be responding to that, meaning these cars have settled on a sort of floor value and probably won't depreciate too much further.  It doesn't matter if the seats are a bit dated if everything's still working.  A more modern second hand car can't compete if, when turning the key, the first thing confronting the driver is a load of dead instruments and warning chimes.  

I think you've got a very good point there.

People are becoming very wary of more modern diesels, especially, with their overcomplexity - they're becoming more aware of and comfortable with the trade-off of a few quid of VED and a nominal improvement in MPG being balanced against the unsuitability of DPFs for low-mileage pootling.

That's particularly relevant in and around London, where the choice is Euro6 diesel (mid 10s-on) or Euro4 (mid 00s-on) petrol to escape the ULEZ coming out to the circulars next year. Mid-late 00s petrols are sought-after - high demand, low supply - classic price-rise territory.

caprikid1

Biggus_Dickus said:

A lot depends on the ‘image’ you wish to convey, OP;...whether you buy into it or not, ‘image’ is important in some professions and certain walks of life.

My car is never present in any Zoom calls.

JustAnotherSaver

caprikid1 said:

Biggus_Dickus said:

A lot depends on the ‘image’ you wish to convey, OP;...whether you buy into it or not, ‘image’ is important in some professions and certain walks of life.

My car is never present in any Zoom calls.

Is it present on your driveway to your neighbours and any visitors?

caprikid1

JustAnotherSaver said:

caprikid1 said:

Biggus_Dickus said:

A lot depends on the ‘image’ you wish to convey, OP;...whether you buy into it or not, ‘image’ is important in some professions and certain walks of life.

My car is never present in any Zoom calls.

Is it present on your driveway to your neighbours and any visitors?

No I have garaging for 4 cars, but in fairness the bigger the house the older the car in my village, the smaller relatively new builds seem to have the new Audis and BMW's outside. I guess they have a little circle and look at each others drives and feel the need to play car top trumps.

Grumpy_chap

Biggus_Dickus said:

A lot depends on the ‘image’ you wish to convey, OP;...whether you buy into it or not, ‘image’ is important in some professions and certain walks of life.

This is particularly relevant for meeting Clients, but it works both ways in terms of "image":

• Too grand / sporty a car (irrespective of age) and the immediate perception is making too much money and fleecing the Client.
• A little bit 'ott' car but just on a lease deal and the comments will be similar, - typical 'coupe' or 'off-roader'
• Clapped out banger, and the question might be raised whether you have a viable business, or struggling and will fail to complete the job.
• It all drives people to 'compliant' Focus - Mondeo - 3 Series territory, or 5-series - A6 if a bit more senior in the organisation

The other issue of image is that I have always found it to be good policy for one's career not to have a better car than the boss.  That works well so long as the boss is onboard with the 'compliant' car choice - rather restrictive and non-aspirational for more humble employees if the boss has a 3-series or Focus.

yksi

Depreciation in a perfect world is a bell curve. So yes, cars depreciate much faster when they are newer. But other factors are in play, like Brexit changing possible import tariffs, people not buying as many new cars due to Covid-19 and associated income changes, congestion charge changes in London, the diesel emmissions scandal, changes to the cost of registering certain types of car, changes to the cost of different fuels, new legislation requiring X, Y, Z, yarda, you get the idea. Nothing is going to be a definite. Best just to consider that the newer the car, the more that depreciation is going to hit you, and deciding what kind of hit you are comfortable with. I would think that most people would be hard-pressed to explain a tangible difference in quality between a well-maintained 5yo car and a new one, and if looks are what matter to you, exactly how many people are going to judge you poorly for driving a 14 plate instead of a 19 plate, and is the cost worth it to you in order to kiss the backsides of those vacuous people?

Biggus_Dickus

caprikid1 said:

Biggus_Dickus said:

A lot depends on the ‘image’ you wish to convey, OP;...whether you buy into it or not, ‘image’ is important in some professions and certain walks of life.

My car is never present in any Zoom calls.

...I bet you could get it in the background if you really tried though. 

caprikid1

"The other issue of image is that I have always found it to be good policy for one's career not to have a better car than the boss.  That works well so long as the boss is onboard with the 'compliant' car choice - rather restrictive and non-aspirational for more humble employees if the boss has a 3-series or Focus. "
I've never had a better car than any boss and I don't think I've had a member of staff with a cheaper car than me, I guess it's all about how much value you put on those sorts of measures. Marketing companies everywhere spend billions trying to persuade you to part with hard earned money for such perceived trinkets of success.
Landrover Defender, Old Volvo, MK4 Golf, the drivers will either be penniless or millionaires.