I have a 2004 Audi A4 1.8T convertible presently. I drive about 18K-20K miles a year and my car has 52K miles on it. I am leaning towards trading in my car since I know the Audi will not be cheap to maintain past its warranty. Trade in is around $25k and I have $9k equity in it.

I want another convertible, but there is nothing out that interests me except for the new Volvo C70, but they are getting MSRP and I know it will not hold it's value that well (based on traditional Volvo resale values).

I am thinking of getting the Camry Hybrid since I drive a lot of miles. It would be loaded (no convertible = get the toys). Assuming I pay about $31K and only pay sales tax on the diff of the trade in. Combine the tax credit and one year of payments - I will owe about $17K after one year. What would you expect the trade in resale of a 1 year old TCH with 20K miles? I would think about trading in the TCH for another convert at that time (wouldn't a hybrid convert be nice?).

Thanks for the read and info.

 

If you only keep the TCH one year then you'd probably lose 2/3 of the tax credit. Even if the TCH holds its value well it never pays to trade a 1 year old car. Especially if you pay MSRP and then next year when production catches up on the TCH and they possibly start discounting them. That would hurt the 1 year resale value.

If I knew for sure I was going back to a convertible I'd figure out what I wanted and get it now.

To specifically answer your question, if you get a $31000 TCH and next year (this is already a 2007 model) they discount them $1500 that year I don't imagine you'd be able to sell it for more than $24,000 (and trade for say $21,000).

With my tax credits I'm only going to have $24,000 in my loaded one ($2600 Fed and $3750 State tax credits) so I would have a hard time paying big dollars next year for a used one unless I simply couldn't find one. I really believe they will be plentyful in the summer of 2007.

 

I will take a slightly different approach.... I'm not going to guess at the residual value of the Camry. However, I believe that they will continue to be a "hot item" and will be discounted little, if at all, for several years.

I'm basing this on the Prius, which has been out for a long time. It is still moving as fast as it arrives at the dealerships. Discounts are little, if any. Resale values are high.

The Camry is much more of a "mainstream" family car. I see demand remaining high, discounts low or nil, and residuals high. It is unclear what effect the tax credit issues will have on the car value.

 

Yeah, but when gas goes back to $1/gallon, these hybrids will be useless. Of course, when gas goes back to $1/gallon, look out for the flying pigs!

 

I believe they will be in demand, however Toyota has said they plan to make 1MM hybrids by the turn of the century (which is not far off). Prius has been a fairly low volume auto. The expectation for Camry is 40,000+ hybrid cars per year. I don't expect invoice pricing, but I believe when the tax credits go away they will have to discount them to a competitive price to sell.

I don't hink ANY car would be a good investment if I planned to only keep it 1 year and I had to pay MSRP on it, which is what I got as your plan from your posting

 

Yeah, but when gas goes back to $1/gallon, these hybrids will be useless

Just think, with a 600 mile tank range I would be able to drive to the beach for $15

 

I won't debate the wisdom of trading in a year, there are way too many variables. However, I don't think that it will be much worse that buying any other vehicle. (You'll get screwed no matter what you do).

I still doubt that we will see discounts for quite some time. People are just now beginning to realize that they can't pay for gas to drive the ole Suburban and still make their house payment . I know this too well. My 03 Explorer just became a Corolla and my V6 pickup truck will become a TCH as soon as it arrives.

I suspect that all but the hardest of the hardcore big vehicle drivers (the ones who really need the vehicle) will downsize somewhat when they trade-in their car. Thus, for the next 3-5 years there will be a mega transition to smaller vehicles.

The "medium/small" car market will have a much larger share of the overall vehicle market. Toyota and others will need to grow their overall capacity of vehicles in that size range. I suspect that the hybrids, if they can make them fast enough, will be a large share of that market.

Additionally, If gas happens to go up higher, the residual value of less fuel efficient cars, especially the big ones, will drop like a rock (see Explorer above). Again, everyone gets screwed, the question is who comes out the best.

Interesting discussion.... I need to put an appointment on my Blackberry for 3 years from now to revisit this thread and see If I was right. Time will tell.

 

I took a hit on my 2004 Expedition but I figured if gas went higher I probably wouldn't be able to even find a dealer that would want it, at any price.

With the world political issues I see no reason not to expect high gas prices. Additionally if America wants to become less dependant on foreign oil they need to raise the taxes and make gas prices outrageous (like in most countries already). Then people would decide to buy economical cars and manufacturers would then make more economy cars that appeal to people rather than the SS350 or Hemi family vehicles that seem to be the craze right now. It would be tough on a lot of people, but for long term health some pains are sometimes necessary.

I still own an SUV, I need to haul a trailer with my tractor and my recreational toys, but I don't want a 14 mpg SUV that I use as a family daily hauler (which I had).

Youre right about the trade in. There are a lot of issues, my point to jzklin's comment is I don't see the TCH as a 1 year decision and that if he knows he wants a convertable but doesn't see what he wants just yet, then I don't think trading for one year makes much sense (or any car for 1 year for that matter). Then again if he buys a TCH then maybe, just maybe he'll get hooked and keep it and we'll have another convert.

Now don't get me wrong, I have had many cars I only kept for a year, but I wasn't fooling myself. I knew that I wanted it and in a year I would want something else. However I never bought one with just the intention of keeping it as a driver until the next thing I wanted came along. I went from an Audi TT to a 350Z to an Infiniti FX45. I finally got attitude with the FX45 that I had found what I wanted and I would keep it. However with the gas prices and a decision to simplify I decided I wanted an economy car and the TCH gave me economy and a reasonable amount of luxury and comfort as well.

 

Trade in on an Audi A4 1.8T cabriolet in 'good' condition with those miles is $21k if you have all the regular toys, and not the quattro, according to www.kbb.com. In my experience, if the dealer is not making his mark up on the sale, he's doing it on the trade in. Trade in value is also dependent on where you 'deal'. Where I live, you see an Audi about every three weeks. Part of your problem on this trade in and any future trade in will be the mileage and anyone who buys your Audi, no matter how pristine it is, is going to use the fact that you have excess miles and that the warranty period is about to expire!

 

I got $23K equiped (sports+premium packages) from KBB in Good with mileage (2nd level); Edmunds shows $24.5 for Clean (2nd level) with mileage. The outlier is NADA where it shows $29.7K for average trade ($35k for average resale - yes that is factoring in miles). If only dealerships would use NADA I would be livin' large.

Retail wise - with similar miles dealers are listing them around $30k-$34k. I figured $25k was realistic since a new one equiped like mine is over $40k.


My logic is that if after 1-1.5 of driving (end of 2007); I will owe ($33k<price of $31.5K+fees+taxes,etc>-$2.6k<credit>-$10K equity-$6K<payments> = $14.4K. I would need the car to be worth $24.4K to keep equity.

Assuming the car looses 40% in 3 years (car looses $12.9k) and most of the loss occures in the 1st year (assume 40% of loss). Then the first year loss would be $5K. That would mean I would have a retail value of ($26.5K) which would mean a trade in of about $22K-23K.

Equity after 1 year = $7.6k-$8.6k

Does all that make sense and seem realistic? I could use $ saved in gas ($70 per month) to reduce my payments by factoring it into my payment (assume 1500 miles/month with 24mpg/36mpg respective and a $.15 difference in price for grade).

My brain hurts - I am going to rest.