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  • Writer's pictureSylvain Tornare

Dream Cars at Low Prices? Why Not, But Beware!

Updated: Jan 14, 2022

Buying a sports or luxury car for the price of a new city car? It's possible thanks to the loss of value caused by years and mileage. An article with the best bargains will be posted next week. It is important to be aware of the risks involved in buying an older, high-end car.

Carequest Sàrl car broker Switzerland, rolling shot of a BMW E39 M5 in Le Mans Blue

A used sports or luxury car may seem like a good deal. This can be the case as cars lose most of their value in the first few years. However, it is important to be conscious of the risks associated with such a purchase. This article provides a list of points to consider.


Finances

Price

The purchase price is one thing. However, the running costs are another. These can be substantial. Therefore, it is important to keep some financial room to avoid unpleasant surprises. You should therefore not spend your entire budget on the purchase of the vehicle, but keep a certain reserve to pay for use and repairs.


Maintenance

As mentioned in the last paragraph, you should keep a budget for repairs. Sports or luxury cars are usually produced by well-known makes. Usually, their list price was high. As a result, maintenance costs tend to be expensive as well.

  • Firstly, unlike that of the vehicle, the price of parts does not necessarily decrease over the years. In some cases, it may even increase due to scarcity.

  • Secondly, work on premium brands is generally more expensive. On the one hand, the parts can be more complex. On the other hand, margins and hourly rates tend to be higher. In general, it is advisable to use OEM parts. However, for second-hand cars, it may be worthwhile to look at the aftermarket and the use of parts from other, cheaper makes. For example, some older Aston Martins use many parts from Ford and Volvo. This can greatly reduce costs.

  • Thirdly, wear and tear on the vehicle increases the risk of breakdown and failure. This risk varies according to the mileage and maintenance of the vehicle. A car that is several years old with few kilometres on the clock is not necessarily a good deal. It is therefore necessary to find out about the use and maintenance of the vehicle on a case-by-case basis.

  • Fourthly, high-end cars are not synonymous with reliability. Typically Jaguars are notorious for their breakdowns. BMWs from the early 2000s also suffer from a bad reputation. Maseratis from the same period are a real nightmare in terms of maintenance. It is therefore too simplistic to associate a high list price with good quality in the long term.

  • Finally, second-hand cars have a warranty that will soon expire or has already expired. Repairs must therefore be paid for by the owner. However, there are possibilities to extend the manufacturer's warranty or to obtain a third party warranty.

Insurance

Insurance also represents an additional cost. For comparable coverage, premiums for high-end used cars will be higher than for a new car of the same price. This is due to three main factors:

  • The value of the vehicle and its options

  • The power and displacement of the engine

  • The age and condition

Used luxury cars are therefore penalized on all these aspects. Indeed, their new price and that of their options were high. In addition, their engine size tends to be larger than that of new cars due to changing regulations. Their power is generally above average. Finally, age has a negative impact on premiums. Insurance companies have to cover a higher risk, which increases the costs for the insurer. In short, insuring a used sports or luxury car is expensive.


Fuel consumption

Older cars consume more fuel. Apart from environmental issues, this can make a big financial difference. Let's take the example of an individual driving 15,000 km per year. If we assume a price of CHF 1.70 per litre of fuel, the total cost of a car with a consumption of 6 litres/100 km would be around CHF 1,500, compared with around CHF 3,800 for a car with a consumption of 15 litres/100 km. In this case, the difference is substantial. In addition, there are other consumables such as tyres. Overall, the cost difference depends on the use of the vehicle. For electric vehicles, many questions remain unanswered. We do not yet know what impact wear and tear has on them. One thing is certain: a battery replacement costs tens of thousands of francs.



Technical aspects

Replacement parts

Replacement parts can be a real logistical challenge. After a certain period of time, manufacturers no longer guarantee their availability. Depending on the rarity of the vehicle, it becomes difficult to obtain them. However, the secondary market and spare parts dealers can work wonders.


Technologie

Older cars do not benefit from modern technology. Depending on the use of the vehicle, this can be a disadvantage. Driving comfort is reduced. Some technologies such as adaptive cruise control or hands-free system are still relatively recent. In addition, technologies that were reserved for the most exclusive vehicles are now available in most city cars. The speed with which technology evolves accelerates obsolescence. Also, an older vehicle may be less safe in the event of an accident.


Performance

Recent technical improvements have greatly increased the performance of small engines. The current VW Golf R offers 320 horsepower from a 2-litre 4-cylinder engine. Even better, the 4-cylinder engine of the latest Mercedes-Benz AMG A45S generates over 420 horsepower. In the not-so-distant past, such performance was reserved for sports car manufacturers. In their sporty versions, modern compact cars are therefore able to compete with many sports cars of the 2000s. However, a Ferrari or Porsche will have a bigger sense of occasion. In short, technological evolution has democratised access to power.



Conclusion

Summary

Financially speaking, used luxury and sports cars are attractive from a purchase price perspective. However, the running and maintenance costs are relatively high. Of course, this varies from one model to another, depending on the year of production and the mileage of the vehicle.


From a technical and technological point of view, older vehicles also have their weaknesses, especially due to their ageing technology. However, these disadvantages may not be very relevant depending on the use of the vehicle. Typically, a car bought for weekend fun does not need the latest technology. The age of the vehicle also plays a role.


Recommendations

To avoid unpleasant surprises, we recommend that you take the following points into account:

  • Research the reputation of the make and model.

  • Make sure that the vehicle has been properly maintained and that the necessary repairs have been carried out. Avoid vehicles that have been involved in accidents.

  • Get information about the previous use of the vehicle. Was the vehicle just used for Sunday driving or was it abused on the racetrack? Was the vehicle driven mostly on the highway or in the city?

  • Keep a financial margin for maintenance and repairs and find out what warranties are available and how much they cost.

  • Think about the need that the vehicle must cover. If it's a car for daily use, a newer but less exciting car may be the best solution. If the vehicle is a weekend toy, a second-hand sports car may be the right option. In this case, get interchangeable plates. This will save you insurance premiums.


In short, depreciation is great. I'm a big fan myself, as it gives access to vehicles that are otherwise unaffordable. To avoid mishaps, make sure to take the above points into account. This will avoid unpleasant surprises and help you get the most out of your budget.

The best solution is probably to contact us! At Carequest, we will find the right vehicle for you and make sure it won't cause you any problems.



 

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