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Late Rambling & Going Green: is it worth it?! MATH!

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Late Rambling & Going Green: is it worth it?! MATH!

Just a heads up, the bulk of the following was a "thinking aloud" message to a friend. So it's a bit of a ramble. Get ready to have a lot of numbers thrown at you! But I thought this would be good to share, as it really breaks down the costs of "going green." And it should make some here really reconsider if they want to go about buying a newer car vs keeping what they have. For the sake of rounding, this could be viewed as getting rid of a car needing repairs vs a 30k loan on something that gets nearly 6x better fuel economy (not the case in most people's vehicle changes lol) and dropping a second car from insurance.

Quick "background" to this:
The monthly payment wouldn't be an issue to me, but is it REALLY worth it, or even worthwhile? Near $600/month...as a healthy, youthful, and childless male I could spend that in many fun other ways...put it all on black, come'on, baby! (joking)
Anyway, being kinda frugal, I have two 'older' but purposeful vehicles. A loaded '05 expedition (will be referred to as 'Expy' a lot) and a loaded '07 v6/awd fusion. Having no payments is such a nice thing. The Expy has been out of commission for a bit because...well, it's the original 5.4 3v V8 Trition. Need I say more? So the Fusion has been my daily driver. But earlier this year I moved very close to where I work, so despite the fun factor the sedan has, it's better gas mileage isn't very needed. I've been mulling over pulling the trigger and dang near rebuilding the Expy with a new engine and replacing a lot of the guts and things.
However, yesterday I found a nicely priced Tesla that really caught my eye. So, here I present to you: the massive gas-guzzling tank vs stylish car of the future.



Got bored. Did number crunching...
There's a CPO 2014 Model S P85D for 44k. Only 52k miles on it. Looks to be pretty loaded...full winter package, the adjustable performance suspension, ludacris mode. 2 years on warranty remains. Since it is 'D' it's dual motor/awd. Tesla finances at 4.99%. Not much higher than current auto loan rates it looks.
I could...forego doing the Expy (7.2k...possibly more). Sell Expy & fusion (quick sell to not continue insurance...2.8k). That's 10k down.

Idea for Expy repair was have it around for next 5-7 years. Tesla loans are 6 year terms. Comes to 547/month. Sounds like an unwanted bill, but with rough initial estimate, car insurance would drop by ~140/month (much newer vehicle & just 1 vs 2, but much higher vehicle value). No oil changes like on Expy, ~$9/month. While using the nearby 'pricey' turbo chargers, would only save about 47/month fuel wise vs Expy...but after buying a house [note to myfico readers: been in market to buy a house past 2 years, but nothing really interesting; however, going to stop being so picky next year to stop throwing away money on rent] and spending only 1k for home charger install (parts & labor), would save about 105/month. This is all assuming fuel is $2.50/gal constant & electric stays around 13 cents per kWh.

So, next year my monthly expenses would be around +350. The 5 years after would be around +295.

And I just remembered taxes, tags, and registration. Fml. +3300. Would add about 50/month.

So I could just do the Expy for around 7.2k, sell fusion (quick sell, 2k). Over the 6 years have no payments. My spending change would be +30/month (Expy gas consumption vs current fusion usage) and -130ish insurance/month. So save an extra $100/month vs present.

Caveat: resale value after 6 years. These are just guessing kind of numbers:
Expy, $3k; P85D, $20k? 17k difference worthwhile?

Going Expy instead of P85D payments saves 1(100+350+50)*12 + 5(100+295+50)*12 for those 6 years.
Total: 6k + 26.7k = 32.7k

So I'd be at -15.7k once I own the Tesla. Well, -16.7k due to installing the home charger.
If I kept it for another year at no payments....would be the 9/month in oil changes and 105/month in fuel. Insurance prices probably pretty even at this point (P85D would be nearly 12 years old once owned). So P85D would save 1368/year. Would take over a decade still to break even to "go green with a fun car."

Oh yea. Forgot...10k downpayment for P85D vs 5.2k for Expy. Add another 4 years to breaking even on going green.

Side note: been paying attention to EVs a lot. I forsee 2021 being around when things get amazing. A lot of big competition as Ford & others should be releasing a lot of stuff, along with a lot of start up companies ready to release their "tesla killers." Plus, that battery tech & range is about to get crazy good right around then, too.


Note to myfico readers: of course you can go green for much cheaper with a Nissan Leaf, but if I'm going green now-ish, it'll be with a vehicle that can at least compete with my fusion. Currently only the Teslas offer awd.

Extra breakdown for myfico readers: a lot of the "keeping value somewhat close" for the Tesla comes from estimate resale value after 6 years. Keep in mind that during the 6 years, I could be investing that monthly $350, or even just tossing it into a savings account and collecting interest.
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Valued Contributor

Re: Late Rambling & Going Green: is it worth it?! MATH!

hmmmmm . . so much going on here!

 

When it comes to Tesla, I'm mostly nervous about the accessibility of repairs. There are a lot of horror stories online of folks that got into even minor fender benders that were waiting 6+ months for their cars to be repaired.

 

I also don't know about their longterm reliability and whether or not buying one that is 5 years old is asking for trouble . . . . 

 

As for your current cars, if the Fusion runs just fine and you only think you'd get a couple grand for it, I'm wondering why you wouldn't just hang onto it. My car is an '07, and basic insurance coverage is $50/month. If you go the route of keeping the Expy, it could be nice having a second car on hand as to not be carless when other things ultimately need to be fixed in the future.

 

As for the Expy, I think a $7200 price tag might be steep for repairing a 14 year old vehicle. Have you considered a low mileage used engine? If it could be road worthy again for, say $3k, I think this plan could make a lot more sense.

 

I dumped about that much money into a 12 year old car over the last year, but it wasn't exactly planned.

 

It started out with me deciding to keep the car and catching up on all of the major maintenance (timing belt, water pump, transmission service, EVERYTHING in the book) which was about $2500.

 

Then nearly all of the suspension in the front end needed replaced to the tune of $2500.

 

I was loving the car and everything was great for nearly a year, and then the turbo went out at the beginning of this summer. $2600 again.

 

Only time will tell if fixing the car was a terrible idea or not. Had I known it was going to be an $8k adventure initially, I probably would have gotten something else. But the motor and transmission are strong and it runs great and I'm very happy with it, so I'm just crossing my fingers now. I do like that I still don't have a car payment. I'm juggling some of the repair cost on 0% CC's, and will be done with those in a few months and not staring down another 4/5/6 years of a car note or whatever.

 

One thing that sucks about dumping so much $ into this car is that if something happens to it, the book value is probably $3k on it and I will lose out big time. I don't even let my partner drive it . . if something happens and that loss is my fault, it sucks, but it's my own fault. If something happens and someone else is driving it, I don't want that blame laying on them. And I truly believe you never let anyone drive your car without knowing that accidents can happen. That's not a big deal when you have a normally valued car + full coverage insurance, but is very different in this scenario.

 

The other thing to consider is that if you love Expeditions (or any SUV, truck or other vehicle) have you thought about seeing what you can get in the used market for a modest price like $15k or so?

 

 

Ch 7 Discharge May 2015
Discover/Target/NFCU CLOC/NFCU Cash Rewards/NFCU Platinum/PenFed Power Cash Rewards/PenFed Pathfinder AMEX/Citi Costco Visa - $96k total revolving
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Regular Contributor

Re: Late Rambling & Going Green: is it worth it?! MATH!

Only thing I'd be concerned with the Tesla is repair accessibility in the event of an accident. I think those long waits were mostly early on, as Tesla was seriously struggling to keep up with demand for production. Their facilities have been expanding a lot just to try keeping up still. You're on a long waiting list if you order a new one. But I'm not too worried about it. Longevity of itself, there is no concern. The long term life of the battery packs are pretty dang proven at this point by people running up the mileage.
I think I read that an EV only has around 11k parts, compared to around 30k (per Toyota supposedly), so at least diagnostics should be much more straightforward.
But price wise of it currently, I just can't justify it other than "because I can afford it." That's not good enough. Perhaps after I get my money's worth with the rebuilt expedition in 6 years or so, some awesome new EV pick ups or SUVs will be around at a price I'd be willing to do? Or keep the expy around and get an EV sedan?

The Fusion is fine for now, but it does have some minor issues that I cover up with routine care for it. Also getting high up in mileage.
The fusion was purchased as a second car years ago, but it no longer has that purpose. It's been kept around as a back up, like you're suggesting, for while I was working on the Expedition, but it's now time to let a good mechanic tackle it rather than this weekend warrior (plus, CoA would have a fit if I did an engine swap here lol). But the insurance just isn't worth it on two low values vehicles. I live close to work now...an Uber or Lyft for a week (or just a basic car rental) isn't going to break the bank, if I own just 1 vehicle. Actually had to uber for a few days while I waited for a new fuel pump to arrive. So that's the other thing--the Fusion isn't that much younger. All those 10 year replacement parts are about to be coming up. Already put in a few new sensors.

The $7k+ price tag is much more than just the motor. Around $2k in labor (cash discount). The remanufactured engine with a 5 year no fault warranty is around $3.8k. The rest of the estimate is new catalytic converters, new exhaust manifold, power steering pump, water pump, radiator, new fuel line, and such things. When that big engine is up and out of the way, the labor cost for other parts to be replaced is much cheaper. Smiley Wink I can handle most car care repairs & such myself, so vehicle upkeep is cheaper for me than others who need to see a mechanic to get a cvt sensor replaced. I've also become very familiar with the parts of this expedition over the years. lol

The reason to not go with a used motor is similar to why I'm opting to repair this Expedition over grabbing a newer used. Up until 2015, the same engine was used. With all the same design flaws from the early 2000s. The remanufactured engines get rebuilt to eliminate those problems.
I like to have something that can tow plenty, as well as a high payload capacity. A pickup would fit this, but I prefer the full size suv for trips into the mountains with friends. During winters, the Expy has proven to be quite the utility vehicle.
Among full size suvs, the expedition best fits my purposes. Most are kinda small & lacking in tow/payload like the Armada, too. Only the suburban is a real option, but certain things I don't like about it (such as no independent rear suspension, yet manages to tow less--what?!).
Anyway, in 2015 came the twin turbo v-6s for the expedition. Thanks to the 2018 redesign, the 2015-2017s can be had at a great price. Around 30k. Which is tempting. But...it wasn't until 2017 that Ford learned what companies like Toyota and BMW had about long ago in regards to fuel injection with a turbo'd engine and carbon build up...so yea, don't buy an EcoBoost engine until 2017, folks! (And if anyone already has a pre-2017 EcoBoost, it is recommended that you slam down on the throttle for a moment every once in a while).

SUVs that aren't the expedition or suburban mostly fall into the cuv category, minus maybe the 4runner. Those cuvs have the same workings as a sedan, so I'd rather take the fusion over a 15k crossover. It's pretty solid in winter weather and has a good ground clearance. But it's not climbing the side of a steep mountain during a blizzard while transporting the crew, like the expedition has. Had a fully loaded trailer in tow during a storm and had to back it up hill on a crazy loose-rock driveway that had near 2 feet of untouched snow on it. Was crazy. The trailer wheels weren't even rolling. It was just the Expy pushing it up the hill, in reverse. A cop even stopped to watch. lol

But yea, hard to justify a 30k loan even at top rates, if you have the option to fix up a good vehicle. You should find yourself in a good spot with your 8k repairs. Even if your car explodes 2 years after...you then only paid about $333/month over those two years. Cheaper than most car payments.

If I were already in the market to buy a 40-50k vehicle, then the Tesla gets to be in the conversation again. If I could find a nice P85D under 35k, the "because I can afford it" argument might be enough, though, haha.

I guess by being cheap, I don't have to worry about my dog's nails in the Tesla's interior.

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Valued Contributor

Re: Late Rambling & Going Green: is it worth it?! MATH!


@Rebuilt wrote:



I guess by being cheap, I don't have to worry about my dog's nails in the Tesla's interior.


This hits home for me having a car I park on NYC/NNJ streets. I detail my car regularly and when city bumps and bruises happen, I'll buff out what I can, take the dent puller to it, etc., but I quit getting too worked up about them years ago.

 

Keep us posted on the project!

Ch 7 Discharge May 2015
Discover/Target/NFCU CLOC/NFCU Cash Rewards/NFCU Platinum/PenFed Power Cash Rewards/PenFed Pathfinder AMEX/Citi Costco Visa - $96k total revolving
EQ/EX/TU: FICO 8's November 2019: 696/679/668, 14% utilization, AZE2 (w/ those 2 cards reporting 30% util), INQ's: 4/2/1
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