I'm moving from San Francisco to Palo Alto this fall and will be needing a car to get around. This will be my first car purchase ever. I had originally planned on buying (outright with my savings) a 2006 Prius in September, but after reading all the articles and posts about the much-anticipated 100+ MPG 2008 or 2009 model, I am now strongly consider waiting until then to buy a Prius.

I know there's always going to be a new and improved model right around the corner whenever you make a car purchase, but I feel that this level of innovation is enough to actually make the wait worthwhile.

As far as I see it, my options are as follows:

(1) Buy a used car and re-sell it in 1-2 years. I'd probably opt for a non-hybrid that I think is unlikely to lose a lot of value over the course of the two years. I am guessing that the resale value of hybrids will drop more (in % terms) than a non-hybrid car with the launch of a 100+ MPG Prius.

(2) Lease a Prius or another car for 2 years. However, considering that I have enough cash in savings to buy a car (used or new) outright, this seems like a financially unsound move.

(3) Suck it up and buy a new Prius now. Who knows-- the 100+ MPG may not even materialize for another 3-4 years...

Would love to get others perspectives and opinions on which option is best. As I mentioned, I've never purchased a car before-- I have lived in a city and not needed one for the past seven years. Would really appreciate hearing the thoughts of all of you with a bit more car-buying experience and saavy.

Thanks!

Please note that the 100+MPG was myth.
It was based on the 40km/L Japanese 10-15 mode test.
The current Prius is rated as 35.5km/L and Toyota's target for the 2009 model year is the 40km/L, 12% increase, which means their target is 62 MPG combined EPA number.

Ken@Japan

Wow, I had not yet read that Ken (and I've done a lot of searching and reading on this topic) -- thanks for the info. Could you direct me to a thread discussing this? I wasn't able to locate anything with a search.

Please refer to...
http://priuschat.com/index.php?showtopic=18242&st=42

Ken@Japan

The only credible 100 MPG claims are those who have a 'plug-in' capability with sufficient EV range to handle the commute distance.

You've identified your options and since this is your first car, I'd recommend getting one with a good warrantee package. IMHO, a used car, is more of an option for those with the skills and confidence to do their own maintenance. If you do go new, check current tax codes and status carefully. My understanding is many of the hybrid tax benefits have limits. Used carefully, it is a negotiating point.

Also, don't forget that in life, good, fast, cheap, pick two of three. I'd recommend starting early, before the need is immediate, with a good mapping of the prices expected. Then you'll be in a position to take advantage of a good deal.

I was buying used and knew the blue book values and had my financing already worked out with the bank. When the car came available, the deal was easy.

GOOD LUCK!

Bob Wilson

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Please note that the original article did not say anything about the plug-in.
It only said Toyota is determined to hit 40 km/l (113 mpg) with the next Prius.
http://www.edmunds.com/insideline/do...ticleId=109981

Ken@Japan

If it were me, I would probably go ahead and start looking for my new Prius now. There will always be something better over the horizon, even in 2008. Not only that but who knows how much buzz there will be around the new model, driving the price up to ridiculous levels. It could be another year after its introduction before it really makes any sense to buy it. Besides, the current model is pretty darned good at sipping fuel, especially if you learn how to milk HSD for all it's worth.

It's probably further been fueled by the aftermarket-modded 100+ mpg Calcars.org Prius+, which gets its 100+ mpg claimed mileage due to aftermarket plug-in capability and add'l/different batteries.

- Shannon (Geeky, Wild Texan)

I'll add my 2 cents worth.
Financially you are right about leasing. Leasing is renting. Don't ever lease from savings, lease from your net pay. I personally don't believe in leasing unless there is some financial benefit from business.
As for whether ot buy new or used, financially speaking the best situation is a current model (2006) from the dealer that has been driven (a few thousand miles or so). You get the warranties, basically the same useful life as if new, and you'll pay 10% less. Next year you will have the same exact car as the guy who paid full price.
Only problem is....good luck finding a demo Prius.

I think the current model Prius ought to be considered for the 'buy and sell soon' option, specifically because its rate of depreciation has been so low. In fact, more than a few folks traded 2004 Prius for the 2006, and did scandalously well.

DAS