(Volkswagen Passat image courtesy of Google)
I travel quite a bit from one end of the island to the other end each day for work. Weekends no need to say lah as I am out of course... a lot! I am also a car guy. I love cars; the technology and innovation is just overwhelming at this point in time that I wonder what more can car manufacturers invent to make the car better. That said, I am also an economist, a person who compares value for money @ typical Penang kiam-sap/ stingy.
I can't help but notice the amount of new cars on the road. I think we are like in the middle of the PJ* series of car registration numbers. I think the Penang people are certainly rich. All having the latest Mercedes, BMWs, Hondas, Toyotas etc.
New cars these days are not cheap. If you exclude Malaysian vehicles, we are talking atleast RM 70k for a new non-national car. Of course one that was built in Malaysia though or as it is called the Completely Knocked Down (CKD).
A lot of people are taking big loans to get nice new cars. Banks are also capitalizing on this especially when the interest rates have recently gone up. I think it's like > 3.5% . From months and months to years(up to 9 yrs) to pay for a car.
New car sizes have actually become smaller for the price you are paying today than when it was the 1970s and 1980s. Cars back then came with more metal and less plastic! Haha! I can never convince you more; compare my 2007 Myvi with my dad's 1994 Volvo 940! All the metal of my car doors could make just 1 door for his Volvo.
Whatever happenned to checking out the local Motor Trader or Classifieds for good old car. I don't mean old as in antic. More like a 'used' vehicle. Used vehicles range from a couple of weeks old to years. Some have been very well taken care and even restored. Getting a used car would be a steal these days considering the trend towards new cars. You can get a pretty good used car for so much less than new.
For example, my bro who has a friend who has a 2 year old Volkswagen Passat 2.0. The car is great but he wants a car that can please him more in terms of technology, safety and style. His a car guy of course. Brand new then RM220k. Now... ur ready for it......................RM 140k.
Now this is nothing to be alarmed. However, have you ever realized or calculated after interest the amount of money lost on your own?
That is why I am suggesting, if you can't afford a new car or if your economically aware of the surplus in money to get a new car, get a used car. You would be paying much less for the same specification of a car but after 1-2 yrs. Cars have a manufacturing life-span of around 5-8 years in the market before they reach end-of-life. So the car would be relatively new/ up-to-date.
Considering how much value of a car depreciates, it wouldn't be a waste NOT to take a look at a good used car.
With todays stringent motoring rules especially in countries like in UK, the car will be thoroughly checked to ensure it is safe and technically sound. Car companies as well like Toyota and BMW also sell pre-owned/ used cars basically, that have gone through checks and restored to be sold as quality used cars. This is a good place to look for a used car as these companies have a reputation to uphold.
Spare parts I believe are plentiful for most cars on Malaysian roads so even if you can't get a new one, you can get a refurbished replacement part. That also if the chop shops in Malaysia are still around. Can get some pretty reasonable used parts.
But besides getting a used car, just imagine how much money you would have saved for other things like property that appreciates, better health insurance, funds for further education or going for a holiday. Come on people! That is what well spent money can earn you.
However with all this said, if you think about it, it is this new car segment people that over-flow the used car market in years to come for us to get our hands on them and offer us a wide variety to choose from! :)
