00:00 – Show Open - Motivation Behind The Better Than New Podcast

If you are listening for the first time to Better Than New, welcome!  It’s great to have you listen in to this podcast. For those who have been listening for a while, I hope you are enjoying these episodes and you find the content helpful in identifying interesting used vehicles you might want to purchase. With several episodes completed, I felt it was time to explain the reasons I do this podcast in more depth and also to identify some of the reasons why you might want to keep listening and what you can expect in the weeks and months ahead. 

01:00 - 2 Key Reasons I Created The Better Than New Podcast

There are two overarching reasons I do this podcast.   First, I do this show for me.  I love cars and trucks, and this podcast is an extension of that passion.  Consequently producing this content is a labor of love, and I have wanted to do a podcast like this for a long time to share my automotive knowledge with a wider audience to help people find a cool used car, truck or SUV at a great price. 

Second, I do this show for you… the listener.  There have been a lot of changes in the used car marketplace in the last couple of years that really point to a need for content like this that helps people save money on their next vehicle purchase and I think the real value is in used vehicles.  

Prices for all vehicles have skyrocketed since the pandemic began, and now the average new car price in the US is more than $47,000!  The average used car price is up too.  It is somewhere between $28,000 and $30,000. 

That said, if this podcast can help listeners identify interesting used cars, trucks and SUVs and save them thousands in purchase costs, then mission accomplished.    

04:30 - Ten Pragmatic Reasons Why This Show Should Matter To You

04:50 – Reason #1 – Used Cars Are Where The Value is

With the high prices for new cars, it’s clear that used cars are where the value is.  But as I just mentioned, used cars are much more expensive now too.  That’s why we will explore interesting, fun-to-drive used cars, trucks and SUVs that are older than three to five years, and therefore less expensive, but still have a lot of life left in them for buyers interested in getting more for their money. 

05:55 - Reason #2 – Used Cars Are Available, Where New Cars Are Not

New car inventory issues caused by the pandemic-induced supply chain and computer chip shortages means there is not a lot to choose from when it comes to new vehicles.  Also, the few vehicles available on new car lots often times have additional mark-up added on top of the list price.  While more expensive than they used to be, used cars still don’t experience these same pricing issues.  Sure, some used cars are still hard to find, including three to five year old used vehicles.  However many of the vehicles we will cover on Better Than New are available now with a little bit of careful searching. 

07:20 – Reason #3 - The REAL Value Waiting To Be Unlocked Is In Older, Less Trafficked Used Vehicles

This podcast is all about finding used cars, trucks and SUVs that deliver value to listeners, and the greatest value available is in older, yet still fun, interesting and completely viable used vehicles that have been maintained and cared for by loving first or second owners.  In the weeks and months ahead, we will be identifying vehicles that fall into this category to help listeners get the most for their used car dollar.  

08:20 – Reason #4 - Older Used Vehicles Experience Less Depreciation

Used cars in general experience less depreciation compared to new cars.  Even better, many of the used vehicles we will discuss on Better Than New will be at or near the bottom of their depreciation curve.  That means that any depreciation buyers of these cars experience will be minimal, and in some cases, non-existent.  And while were not suggesting you buy a car based on investment value, over time, some of the vehicles we discuss on the podcast may hold their own or even increase in value a bit, in spite of continued use.  

10:30 – Reason #5 – Older Used Cars Have Less Of The Complicated Electronic Components Found On Newer Cars

Newer cars have computer chips, electronic modules, and other complicated systems that tend to fail over time at great cost to their owners, especially once the vehicle is out of it’s manufacturer warranty period. Fortunately, older used vehicles have less (or in some cases, none) of these systems and don’t suffer costly failures at the high rate that newer cars do. 

13:30 – Reason #6 – Used Cars Are Easier To Work On For DIY Owners

I encourage listeners to do some of the easier maintenance and repair projects on their cars in an effort to save money.  Not everyone will be comfortable with this, but it’s still something I recommend. 

Another reason to do some of your own work is it helps you find and identify other potential issues with your car.  I give some examples of potential problems I found that helped save me money on cars I’ve owned.

15:40 – Reason #7 – Older Used Cars Provide More Driver Involvement and Feedback Compared to Many New Cars

In an effort to reduce noise, vibration and harshness (NVH), new cars filter out much of the feedback that comes to drivers through the suspension and steering.  This can be helpful to make the cabin a more peaceful place while you’re riding in a car, but it can numb the steering to the point of being “dead” in terms of communicating road feel to the driver. 

I compare and contrast the direct and accurate steering of my early Miata with the steering of some late model vehicles with less feedback as a good example of how manufacturers are filtering out too much of the sensations and feedback that can make driving fun. 

17:18 – Reason #8 – Opportunity Cost is Much Lower On A Used Car

I’m not an investment advisor or expert, so I’ll turn to a source that is for an explanation of Opportunity Cost. The website Investopedia.com says “Opportunity Cost represents the potential benefits that an individual, investor, or business misses out on when choosing one alternative over another.” 

In other words, you need to ask yourself what else could you do with the money you set aside to buy a car.  To explore this more deeply, I give an example of someone buying a new car (I rounded up the $47,000 average price to $50,000 for easier math), and compared the opportunity cost of that new car purchase to the purchase of a used car that was only $15,000.

New Car Purchase vs. Used Car Purchase

In my ballpark NEW vs. USED scenario, I assumed the new car price was $50,000, then added on 10% sales tax to get $55,000.  I then subtracted the cash down payment of $15,000.  This left $40,000 left to finance.  Assuming a 5% interest rate and a 60-month financing period, the monthly payment would be $754.85 for a total cost of 60,290.96 (car price + down payment + interest + taxes).  Again, I ball-parked the overall cost of the new car at $60,000 in the podcast discussion.   

For the used car portion of this scenario, I assumed the used car purchase price was $15,000 and I also assumed the buyer used the cash that would have been spent on a new car down payment to purchase the used car outright, so there were no financing charges.  Also, some states charge sales tax on used cars and some don’t.  Assuming there is no sales tax, then the final difference in purchase price between the new and used cars in this scenario is approximately $45,000.  What would you do with an extra $45,000? 

Don’t Forget Depreciation

The other thing to consider is depreciation.  Many new cars lose up to half their value or more after the first five years (some sources put the five year depreciation loss closer to 60%).  Assuming the depreciation on the new car in question was 50% of the original $50,000 purchase price (Remember the extra $10,290.96  was for taxes and financing costs) then after five years it would be worth only $25,000.  That’s a total depreciation cost of more than $35,000 from the original purchase amount plus taxes and financing fees. 

In comparison, let’s assume the $15,000 used car was at or near the bottom of it’s depreciation curve and it theoretically experienced 20% additional depreciation of it’s value after five years, making it worth $12,000.  That’s a total depreciation of only $3,000 over the original $15,000 purchase price.  While this scenario doesn’t factor in things like maintenance and repair costs, it does highlight the fact that used cars are considerably cheaper to purchase compared to new cars.       

21:25 – Reason #9 – Who Do You Want To Make Rich?

Not so much a reason, but rather a question that is an extension of the Opportunity Cost discussion. To make it more personal, I like to flip the idea of opportunity cost upside down and ask myself, "Who do I want to give my money to?", or "Who do I want to make rich?" 

Do I want to help the owner of a new or used car dealership pay for their yacht or their vacation home?  Or, do I want to keep that money for myself and use it for education, the down payment on a house or maybe a vacation? 

It’s a great question that only you can answer, but no matter what, an older, less-expensive used car will have a considerably lower opportunity cost compared to a new car or even a more expensive late model used car, plus the money you save remains in your pocket!

23:05 – Reason #10 - We Will Introduce You To Cool Used Vehicles You May Not Have Considered

The cars, trucks and SUVs we will talk about on Better Than New are vehicles that were popular when new. These would be vehicles that you might find on the "Car and Driver Magazine “10-Best” list or on Automobile Magazine’s “All Stars” list from a given year. 

Cars that were popular when new are typically still desirable 10 to 20 years later because they represent the best of what new car manufacturers had to offer the year they were first sold.   

This is not a complete list of the various cars I plan to cover on Better Than New (not even close), but it may give you an idea of what you might expect to find here on this podcast in the next several months. 

The sample list of cars mentioned in this episode that we may cover in the weeks and months ahead includes the Jeep Wrangler TJ, Lexus SC400 Coupe and GS400/430 sedan, Infinity FX35/45 SUV and the G35 Coupe, Acura TSX, C4/C5 Corvette, various Chevrolet Camaro & Firebird models, Ford Mustang GT, Focus ST & SVT, Fiesta ST, Nissan Xterra, Mazdaspeed3, Isuzu Amigo/Rodeo Sport & Trooper, early Porsche Boxster, R56 Mini Cooper S and more, so stayed tuned.

29:00 – SHOW WRAP AND CLOSE