The age-old conundrum when faced with a car purchase is the toss-up between buying new or buying used.
With more than 60 manufacturers vying for your hard-earned, dealerships are making it easier than ever to get behind the wheel of a brand new car, but conversely, there’s huge value in buying used too – after all, someone else has done you the favour of copping the bulk of the car’s depreciation.
So if you’re open to suggestion in regards to buying a new set of wheels, here’s an objective look at the pros and cons of buying new vs used.
Buying a brand new car
- Pro: One of the major advantages of buying new is the freedom of choice in regard to spec level, paint colour, options and engine. If you’re someone who knows what they want and is happy to pay for it, buying a new car from a dealership allows for a multitude of options and a personalised buying experience. The car you buy will be exactly to your liking.
- Pro: Another standout reason to buy new comes in the form of a full manufacturer’s warranty. Peace of mind is everything when shelling out thousands of your own money, and life’s already stressful enough without having to worry about the reliability of your mobility. Manufacturers are now offering up to seven years warranty which could see you warranted for the entire time you own the car – and peace of mind doesn’t come more stable than that.
- Pro: Having the latest technology straight out of the box means that you’re not spending extra time and money later on trying to bring your car up to speed. So much of our lives revolve around technology these days, it makes sense to keep in-step with evolving developments in car safety systems, infotainment and driver assist systems – not to mention the most efficient and powerful engines.
- Pro: Current low interest rates make a solid case for the purchasing of a new car. Choosing to finance the price of a new car can be done then and there at the dealership and ensures your capital isn’t tied up with a purchase of a car.
- Pro: There’s also the intangible benefit of receiving a car that’s fresh from the factory and your unique example that’s free from any damage, stains, and with barely any kilometres on the odometer.
- Con: Depreciation is a killer with all new cars sold. Not only do they cost more up front, but the value of a car depreciates rapidly within the first few months after youtake delivery. Not much of an issue if you plan on hanging onto it for a while, but if you need to sell soon for whatever reason you’ll cop the brunt of that depreciation right in your wallet.
- Con: Associated on-costs and taxes also add to the bottom line, leaving you out of pocket for costs that aren’t built into the retail price. Budget accordingly.
- Con: You might be limited to servicing the car at the selling dealership if you want to maximise your warranty, meaning you may be at the mercy of their service pricing. For example Suzuki will extend your factory warranty from three to five years, but only if you get all of your scheduled servicing done at a Suzuki dealer. The same strategy usually applies to any stated capped-price servicing schemes – those prices can only be had if the service is performed by the dealership.
[NOTE: According to the Australian Competition and Consumer Commission, all carmakers must honour their vehicles standard factory warranty regardless of whether servicing was carried out at a brand-associated dealership or not, as long as servicing is performed according to the schedule by a qualified mechanic and using quality (preferably genuine) parts]
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Buying a used car
- Pro: Buying a used car is a lot cheaper up front, and sellers are generally more open to bargaining for a car in order to move it on.
- Pro: Sellers of used cars, especially private, are often less pushy and leave the purchasing decision up to you.If you’re allergic to pushy sales tactics this is probably a big plus
- Pro: You might find that the new car you’re looking for is pretty similar to last year’s model, however the latter will come at a significantly reduced price on the used market and only have a low amount of kilometres on the odometer.
- Con: Compromise often plays a big part in the purchase of a used car, with buyers unable to specify their own cars how they want, rather having to choose from what’s on offer.
- Con: You could get stuck with a lemon, and have little recompense in terms of holding someone responsible. Unless the manufacturer’s warranty still has some time left on it, used cars only come with a three-month statutory warranty when sold via a dealership. After that, you’re on your own when things go wrong.
- Con: Ongoing costs may well be more expensive since you’re servicing an older car with more tired parts. You may also need to shop around and find a trustworthy mechanic rather than have a dealership sort your servicing for you.
- Con: You’ll be stuck with older and outdated technology from the get-go, not having the latest safety technology, newest features and driving aids can make or break the ownership experience of a car.
There’s myriad ways car buyers can go when faced with buying a car, be it buying brand new, buying year-old demonstrators with warranties intact or buying a cheaper used car.
But there’s no one-size-fits-all way that suits everyone, so weigh up what matters most to you and make a decision accordingly.