A late-model used car can be one of the best values you’ll find when buying a car
. With relatively low mileage, modern safety and convenience features, and usually a much lower price than similar new vehicles,
those used cars are in the sweet spot of auto deals. But how sweet?
A Consumer Reports
study of owner costs shows that choosing a three-year-old car instead of a new one can save you thousands of dollars over
the first five years. In many cases that’s enough to pay for all of your gas during that time.
According to the used car savings analysis, buying a 2005 Toyota Camry with a V6 engine, for example, could save you about
$13,000 over five years compared with buying a new 2008 version. At $4 per gallon, you could pay for all of your gas during
that period (based on driving 12,000 miles a year) and still be almost $2,500 ahead.
Similarly, buying a three-year-old Ford Focus can save you more than $8,000 over the first five years, or the equivalent of
four years of free gas, compared with buying a new Focus.
Need a large SUV but you’re scared of the dismal fuel economy? With demand for big SUVs plummeting and their used-car values
dropping, you could save $25,500 over five years—or the equivalent of seven-and-a-half years of free gas—by buying a three-year-old
Chevrolet Tahoe instead of a new one.
On average, our findings show that you can save 32 percent in the first five years by buying a three-year-old car. Similarly,
with a one- or two-year-old car, you can save 19 and 27 percent, respectively.
Our analysis also highlights another appealing option of buying used: the ability to get a more upscale model with more features
for the same owner cost as a less expensive new car. Buying a new $28,000 Ford Mustang V6 convertible, for example, would
cost you about $42,500 over five years. For about the same five-year cost, you could buy a three-year-old Porsche Boxster
roadster, which is priced at almost $50,000 when new and is a more highly rated, fun-to-drive sports car.
Instead of buying a new Toyota Camry V6, you could own a three-year-old Lexus LS 430 luxury sedan for about $2,000 less over
five years. The Lexus provides a roomy, better equipped cabin and a quieter, more pampering driving experience. Or you can
pass up a new Ford Focus for a three-year-old version of the impressive Infiniti G35 sports sedan.
Using our owner-cost estimates, our used car savings study compared the five-year costs of several popular models based on
purchasing them new or used, when one, two, and three years old. We found substantial savings with all three ages. For several
models, we also recommended used cars that represent an upgrade in features and performance over a new car but still have
similar five-year owner costs.
Learn more about owner costs in What that car really costs to own
Posted: September 2008 — Consumer Reports Magazine issue: October 2008