Another what car thread- with a twist.

I'll be in the market for a new car soon, with a very specific set of parameters. My company is changing our car program. Instead of supplying a car, they are now giving me an allowance plus mileage.

The bad is that the company car was easy- I paid $180 a month towards the lease, the company paid the rest, including gas, insurance, and maintenance. My current car is a 2015 Malibu that I've had since new. 

The good is that if I choose well, I can be driving a better car than the Malibu and come out ahead. 

Here are the new rules...

Must have 4 doors

Must be less than 5 years old and less than 150,000 miles. Can be used, but car must be retired after it hits the above limits. Strongly considering new unless I can come out way ahead used, as I put 30k miles a year on my work car. 

Must have a window sticker MSRP of at least $25k. They do not want us buying cheap cars. Car doesn't have to cost that, a discounted new car or used car is fine, as long as the original MSRP was over $25k.

That's it as far as company rules. It could be a crew cab truck or WRX or Prius as far as the company is concerned. 

My goal- use the program as efficiently to come out ahead, while finding a car that's a good mix of economical and fun to drive. Here is what I have to work with...

$550 per month (plus the $180 I will no longer be paying for the Malibu) plus $.25 per mile for work mileage- a bit over 20k per year (My mileage counts from my office, not home.) I get that amount no matter what I actually spend. 

Here is my short list. Thinking of fun to drive cars with decent room  and good gas mileage. Strongly considering a manual transmission. Kinda dumb for my type of driving, occasional heavy traffic in the CA Bay Area. But I drove my Legacy GT for a few years prior, and my GVR4, and even my Miata occasionally in the past. I figure I may not have that choice much longer. 

Mazda 6

I've love the way they look, love their interior. Supposed to be a good driver's car for the class. Would have to get a 2018, even though both the 2017 and 2018 are available new right now. But it looks like the manual is only available on the base now, and not the NA touring? I'd want a touring, and the base would not meet the MSRP requirement anyway. Love the idea of the turbo version, but the extra cost and lower gas mileage wouldn't make it a smart choice. Likely to get a deal well below MSRP, but how would the resale be in 5 years at 150k?

Accord Sport.

Love the 2.0 turbo, but the 1.5 turbo hits my price and gas mileage targets. One of the only Hondas that I like the looks of. 

Civic Si. 

Kind of a wild card. Probably the most fun to drive/ economical ratio. Hits the price bullseye. Should be more fun to drive than the Accord with better mileage. But would this make sense over the Accord for mostly freeway miles? I'm not very fond of the looks, but I could get over it if it's a terrific car to drive. Is it significantly smaller than the Accord? 

Sonata Sport

Don't know much about these, other than they sound like a lot of car for the money. Any feedback? 

What cars am I missing?

Elantra GT?

With those parameters I'd be looking for an ATS, CTS, or Genesis myself. Slightly older with some miles up to as close to new as you are comfortable spending. 30k miles a year is at least 10/week, might as well be sitting somewhere nice.

Hyundai Gennesis

I'm assuming you have to pay for all repairs and gas right? Also, If you buy a new 2017 is that killing yourself since you now took a year off your eligibility? 

Having done 30K miles a year for a few years, comfort trumps everything else. At $550 a month, That'll get you into a nice ride regardless. The other concern is what happens if you leave the job? You still have to live with the car and the payment. Usually you'll be underwater the whole time because of the miles. 

What's your ratio of fun driving to hell driving? And do you have the room at home for a fun car so that this car can just be an appliance that someone else pays for? And can you plug something in at home? 

I'd be tempted to go drive a new or off lease Volt. In my experience they're spectacular at the kind of driving you describe. The running costs should be cheap enough that work can fully subsidize another fun car for when it's not work time.

I would go '15 +:

V6 Accord sedan

300C w/Hemi

Avalon

Cadenza

Azera

G37/Q40/Q50

Mazda6

This is the exact market I just shopped until one week ago.  I went with G37 because my wife and I decided we liked the sports sedan feel more over luxury, but all were wonderful cars and I'd have been happy with any of them.

Stinger with the 2.0T?

I would be likely to search for a 3 year old and 30k mile car coming off-lease.  This is a low mileage car.  Over the next 2 years you will add 60k more miles for a total of 90k miles (keeping under 100k).  

Now at 5 years and less than 100k you would have an "average mile car" to "slightly high milage" at less than 20k average per year.  I think the car will still resell for not all that much of a loss.  

Years ago, in a corporate setting, I used to do similar with Accords and Civics.  Popular cars that are still popular and considered "good" even as the mileage increases. 

In reply to bmw88rider :

Yes, I have to pay for gas and all other expenses. I do get the $.25 per mile to cover the gas and maintenance. I am stuck if I leave my job, but I've been there for 10 years and don't plan on leaving. 

I think I do need to stick to a more efficient car for this to work, 30+ MPG. That eliminates a lot of cars that I like in that price range, and mostly why I am considering the Mazda and Hondas. 

I do need to run the numbers on 2 or 3 year old cars. It would limit how long I can keep them, but I may be able to avoid the bulk of the depreciation. Thinking it would look something like this?...

New $25k car, drive for 5 years, sell for $5k with 150,000mi. Cost 4K per year. 

Used $15k car, drive for 3 years, sell for $10k at 90,000mi. Cost under $2k per year. 

Does that sound plausible?

I had the same exact program at my first job.  I bought a new 2010 MazdaSpeed3.

Put 150k miles in 4 years, Autoxd the hell out of it during that time and kept it as my fun car for another year before selling it.

Cost me 25k OTD at the dealership total financed cost.  I was paid 26.4k for it over that time(it's tax free), and sold it for 9.5k.  At 3k miles a month you will get another $750 a month(again tax free) on top of the $550.  You will notice a nice increase to your take home income if you buy reasonably (No 70k Tahoe, etc)

Shortly after I changed jobs and was given a  truck.  Despite getting a pay raise my take home pay was the same since my car was paid off and this car allowance is Tax free!!! I changed jobs soon after again to get back to a car allowance program and will never go back.  You won't miss your company car.

I’m on that same plan.  My Accord 5-speed was awesome.  My Silverado hurts due to gas.   I need a truck as I have to deliver a lot of stuff.  If I was not needing a truck I would get the 6-speed manual tranny sport Accord in red.   Honda’s are cheap to run.   

The real money comes the last 18 months of the life of the plan when the car is paid off.  All cash in the bank for the next down payment.   With the sale of the Accord @ 155,000 miles and my savings I had $11,000 cash for my truck.  

I considered grabbing some savings and paying $15,000 cash for a 3 year old 2WD police Tahoe and trying to not borrow money but in the end I’ll run my Silverado 6 years that I paid $32,000 for. 

I would prefer not borrowing money but I did for the sake of reliability.  

Mazda 6. Quiet, comfy, drive well. Knock down 40+ on the highway and doesn't have wild maintenance requirements. 

Comfortably fit 4 adults. 

Not even sure why it's a question.

Honda makes the most sense, whichever one. Off lease v6 would be the best financially. New Civic wouldn't be a bad choice, either. 

With the model bloat, the Accord has been considered a full size car for a while, and the Civic is hardly a small car any more.  

Edit: While I was posting this, the suggestion was made for a Mazda 6. Don't ignore that one!

Thanks guys, good feedback from all. I'll test drive them all. Too bad the Mazda 6 or Accord could not be had in a wagon, that would be the perfect car for this. While I don't deliver often, my Legacy GT wagon was awesome back when I used it. 

I'm definitely going to crunch the numbers on a couple used cars. A 5 minute search turned up a 2016 Mazda 6 touring (auto though) with 25,000 miles, asking 16k. I'd be able to drive that example for 2 1/2 years and would run it up to 70,000 miles in that time. Should be able to recover quite a bit of the purchase price.

The key is to pay it off before and serious maintenance dollars are needed.  By then you will have some cash stocked up.  

My Silverado will need tires in a year and those run $700+?  That bill comes out of my family fund as all my allowance goes towards gas and payment and general maintenance.   

John Welsh said:

I would be likely to search for a 3 year old and 30k mile car coming off-lease.  This is a low mileage car.  Over the next 2 years you will add 60k more miles for a total of 90k miles (keeping under 100k).  

Now at 5 years and less than 100k you would have an "average mile car" to "slightly high milage" at less than 20k average per year.  I think the car will still resell for not all that much of a loss.  

Years ago, in a corporate setting, I used to do similar with Accords and Civics.  Popular cars that are still popular and considered "good" even as the mileage increases. 

20k per year is not average use is it?   Something more like 12k per year is average. A five year old car with 100k miles is to me a high millage car and I would expect the selling price to reflect that. 

I did a little searching and found this. 

https://www.carinsurance.com/Articles/average-miles-driven-per-year-by-state.aspx

Boost_Crazy said:

Thanks guys, good feedback from all. I'll test drive them all. Too bad the Mazda 6 or Accord could not be had in a wagon, that would be the perfect car for this. While I don't deliver often, my Legacy GT wagon was awesome back when I used it. 

I'm definitely going to crunch the numbers on a couple used cars. A 5 minute search turned up a 2016 Mazda 6 touring (auto though) with 25,000 miles, asking 16k. I'd be able to drive that example for 2 1/2 years and would run it up to 70,000 miles in that time. Should be able to recover quite a bit of the purchase price.

 

Eh?  At 2 1/2 years the car is totally paid off.  That 16.5k from your base allowance on a 16k car.  You are getting $6,600 a year just for letting it sit in your driveway.

At 20k miles a year you make $4800 additional for the year.  Gas at 30mpg @$3.0/gal cost 2k leaving for 2.8k per year for maintenance/insurance.  At the end you then sell the car for profit @ $5-10k.  There is no purchase price to recover it's all net gain.

Are Volkswagens right out? It sounds like a GTI might fit your requirements.

That, or the SportWagen. I understand that they make a 6 speed, AWD version of those- kind of like a station wagon Golf R.

In reply to ztnedman1 :

Eh?  At 2 1/2 years the car is totally paid off.  That 16.5k from your base allowance on a 16k car.  You are getting $6,600 a year just for letting it sit in your driveway.

At 20k miles a year you make $4800 additional for the year.  Gas at 30mpg @$3.0/gal cost 2k leaving for 2.8k per year for maintenance/insurance.  At the end you then sell the car for profit @ $5-10k.  There is no purchase price to recover it's all net gain.

Yes, it sounds like a smart way to go. By recovering the purchase price, I meant there wouldn't be a big hit in depreciation, dollar wise. Another plus would be less out of my pocket initially Vs. new. 

In reply to Brett_Murphy :

I like a lot about Volkswagens, but I wouldn't want to own one as a daily driver out of warranty. Which is too bad, because they are one of the last to offer an affordable, fun, wagon. 

I haven't driven one, but from what I've read (https://grassrootsmotorsports.com/new-cars/2017-honda-civic-si/) a new Civic Si Sedan would likely be leading my list.

Alternatively, is it an option to keep running the Malibu if you don't hate it, banking the extra and watching/waiting to see what else is coming (like the Skyactiv-X Mazda's) in the next couple years?

Shouldn't be an issue in CA, but here in MN all of our 2.0 accords had starting issues when we had to move them to plow.

I did a mazda 6 when I was on that same program. You can get more time and money out of a new vs. used. 

You can get a 2018 6 for right around the $25K mark in touring trim. That would put it being paid off in 48ish months and have a free year. Also you get warranty for at least a year or 2 of that so you can bank the extra money for repairs, tires, and insurance down the road.  

Look for something that takes regular gas. That's $.50 a gallon you save. That's $500+ a year at that mileage. That should leave you with around $5K a year as left over money once you pay for the gas.