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Old 12th April 2010, 15:39   #151
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THis is the article I was so eagerly waiting for and it was really worth the wait. Thank you GTO.

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Originally Posted by GTO View Post
Another option is waiting for 2 - 3 years for 'em Fortuners to hit the used market . At 10 lakhs, they'll make for a great buy.
This is exactly what I am waiting for. My Ikon has about 45K kms on the ODO and will complete its 5th year next month. 3 Years more is what I plan to hold it for and then go in for a pre- worshipped Fortuner
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Old 12th April 2010, 19:33   #152
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Hey GTO or others viewing this thread, I have a query on this "lateral" upgrade. I own a first-hand Alto (LXI 2008) which has served me faithfully without any fault so far. I opted for the Alto simply because I had only Rs 3L at hand and I found it great VFM at the time, even though the car has a cramped cabin (I'm close to 6 feet) and is sluggish especially when the AC is on.

Now comes the Eeco. The 5-seater + AC option is almost priced at the Alto LXI level but offers a bigger engine, bigger cabin space and bigger luggage space. Ideally, this would have been my vehicle had it been available in 2008 (Versa was way over my budget).

Would you consider it a "lateral upgrade" if I were to sell off my Alto and hope to get about Rs 2L. Then I could put in another Rs 1.3L and get the brand new Eeco, which is a much bigger car (in the above respects) of my choice and still carries the Maruti benefits (sales, service, resale, etc).

Or would you suggest me keeping the Alto for another 2 years or so and then buying a second-hand Eeco for about a similar price difference.

Let me know. Thanks.

Last edited by misquitas : 12th April 2010 at 19:35.
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Old 12th April 2010, 19:58   #153
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Or would you suggest me keeping the Alto for another 2 years or so and then buying a second-hand Eeco for about a similar price difference.
If it ain't broken, don't fix it!

If Alto is meeting your requirements, and would continue to do so for another couple of years, would suggest you continue using it till the time Eeco becomes available in used car market.

By doing this, you would be able to cut down your loss/outflow on 2 counts -
1) Higher loss in Alto sale on account of steeper depreciation in intial 2 years; and
2) Lesser cost of acquisition of used substitute (Eeco) two years down the line as against a new one if you buy today.

Additionally, it could so happen that you get a decent Xylo roughly around comparable price in 2 years from now - provided you are fine with the looks (If you are okay with looks of Eeco, don't think you would be having reservations about Xylo's appearance). I appreciate that sincerely because you think more from your head than heart

Hope this helps!

PS - to help put things in perspective: when I got my Aug 2004 WagonR valued in Dec 2006, I was getting Rs. 2.5 Lac for it. However, I got 1.65L when I disposed it off last month.
Which means, I was losing close to 1.4L in depreciation in initial two years as against another .85L (=2.5 - 1.65) in next 3.25 years.
Annual Depreciation in first 2 years - Rs. 70k
Annual depreciation in next 3 years - Rs. 28k
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Old 12th April 2010, 21:03   #154
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Originally Posted by AlokSriva View Post
If it ain't broken, don't fix it!

If Alto is meeting your requirements, and would continue to do so for another couple of years, would suggest you continue using it till the time Eeco becomes available in used car market.
Many thanks for your valuable inputs and I will seriously consider them. The only reason why I was considering the Alto -> Eeco deal was that for Rs 1 L or so, I would get a NEW car (as opposed to a second-hand car in this lateral upgrade scheme) which in bigger is all aspects than my Alto. For me, looks of a car has hardly been an issue. It's the VFM formula for me. VFM = Value (price) + Features + Maintenance/Mileage. But yes, selling a car within two years would be a knock out punch for me.

From personal experience, I had bought a second-hand Matiz (2001 model which had done only 4500 kms) in 2005 for Rs 1.5 L. I sold the car in 2008 for Rs 1 L. Lost only Rs 50K in three years. Paid Rs 2L and got a brand new Alto LXI. Reason for selling the Matiz? Though the car gave me absolutely no problem, getting it serviced (in the absence of official dealers) was becoming a hassle. Moreover, we were blessed with a baby in November 2008 and we wanted a car within Rs 3L, which would be reliable and easily serviceable. Hence, the Alto.

Last edited by misquitas : 12th April 2010 at 21:07.
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Old 12th April 2010, 22:12   #155
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Originally Posted by Gansan View Post
They wanted to experience the sensation of taking a new car home with balloons and ribbons from the show room, at least once in their lifetime. I did not have the heart to say no and gave in. But I made it clear to them that the next car will not be a new one!
That's a feeling that can never be quantified and many, many people end up in a showroom for a new car for this precise reason. The whiff of the interiors of a new car, the feeling of driving off in your NEW car can never be replicated by a second-hand car. The Mastercard advert describes this well. Some feelings in life are priceless.
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Old 13th April 2010, 10:20   #156
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This thread brings back memories of "the mother of lateral upgrades'! When I joined my employer in 1984 as a fresher, we were eligible for only two wheeler conveyance allowance. The 100 cc bikes and M800 were just entering the market and the big three of both 2 wheeler and 4 wheeler markets ruled the roost. The Chetak was a vehicle to die for!

People became eligible for car allowance after promotion to a particular grade, and those on the verge of this promotion almost invariably will own a Chetak/Super. As soon as the promotion came through, they would sell the Chetak at a profit and buy a used car - mostly a Standard Herald + one used TVS 50 for daily commute!It was a township adjacent to the factory, so distances for office commutes were small!

Now how is that for VFM lateral upgrade!
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Old 13th April 2010, 16:21   #157
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Originally Posted by misquitas View Post
Would you consider it a "lateral upgrade" if I were to sell off my Alto and hope to get about Rs 2L.
Nope . Lateral upgrade = Sell used & buy used.

I would suggest you retain your Alto for another couple of years, as it will now depreciate very slowly (loss of value is quickest in the initial period). On the other hand, if you feel the need for a bigger car, there are plenty of Swifts, Balenos, Honda Citys and Lancers available for three lakh rupees.

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Originally Posted by Gansan View Post
As soon as the promotion came through, they would sell the Chetak at a profit and buy a used car - mostly a Standard Herald + one used TVS 50 for daily commute!It was a township adjacent to the factory, so distances for office commutes were small!

Now how is that for VFM lateral upgrade!
Unreal! That truly is the "mother of lateral upgrading".
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Old 13th April 2010, 17:32   #158
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I am considering a 3 month old mercedes E 250 CDI (new model). The seller is asking me to quote a price. What would be the appropriate price to start bargaining?
This car has done approximately 7000KMs.

Also a BMW 320d highline 6 months old. Done about 8000 KMs. The seller is quoting 23Lacs. What would be the appropriate price for this vehicle?

Last edited by himavanth_m : 13th April 2010 at 17:33. Reason: spelling error
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Old 13th April 2010, 23:24   #159
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Originally Posted by himavanth_m View Post
I am considering a 3 month old mercedes E 250 CDI (new model). The seller is asking me to quote a price. What would be the appropriate price to start bargaining?
This car has done approximately 7000KMs.

Also a BMW 320d highline 6 months old. Done about 8000 KMs. The seller is quoting 23Lacs. What would be the appropriate price for this vehicle?
I could be wrong but the generally accepted fact is the moment a buyer takes his car out of showroom, there is straight 10-15% depreciation depending on the segment.

At 23L, 320d HL you mentioned seems to be a steal! Having said that, it in no way should prevent you from starting with 19L and striking the deal at seller's lowest price point.

However, please try to figure out the real reason of this sale so that you are not in for any surprises at a later point of time. A complete B-2-B checkup of the vehicle at BMW workshop is a must. Might cost you anything between 6-10k, but please get this done before you commit yourself to the deal.

7k kms in 3 months on merc you mentioned seems to be unusually high usage - again, that's just me. Not too familiar with Merc's valuation therefore, can not comment on what your quote ought to be. Rest assured, you would hear from a fellow member soon - else, GTO, who specializes in Mercs specifically ;-) would help you out.
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Old 14th April 2010, 11:57   #160
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Thanks Alok for your response.
The BMW has scratches at the back and the reason for selling is that he is not able to repay loan. (going to be seized by the bank). However, I have checked with the showroom and there seems to be no issue with the 320d. and I will start with 19lacs as you mentioned.

As far as the merc is concerned, there is a dent on the top(may be a case of coconut). I am still unsure of what price point to start (may be 25lacs) .The seller is not quoting any number yet. The vehicle has done a lot of Hyd-Vijayawada trips.
One thing that concerned me about the merc is that after 4 months, the vehicle is still in temporary registration.
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Old 14th April 2010, 12:26   #161
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Originally Posted by himavanth_m View Post
Thanks Alok for your response.
The BMW has scratches at the back and the reason for selling is that he is not able to repay loan. (going to be seized by the bank). However, I have checked with the showroom and there seems to be no issue with the 320d. and I will start with 19lacs as you mentioned.
Let me play devil's advocate here - someone buying 32+L vehicle would surely have sorted out his finances before the purchase. And therefore, it seems unlikely (not impossible though) that his finances went bust in 3 months to such an extent that there is a need to sell off the vehicle.
Anyway, this seems to be a distress sale and therefore, if I were you, this would have been my course of action -
1) get the vehcile tested at BMW workshop ASAP
2) if results/findings are positive, sit with the seller for final negotiation
3) carry your cheque book along when you finalize the deal.
4) communicate your budget to seller (19L in this case)
5) wait for seller's reaction
6) ask seller his minimum (for discussion sake let's assume this to be 22L)
7) Take out your cheque book and tell him you are willing to pay a token amount (bigger the better as it would entice the seller) right away.
8) take the mid value of 19 and 22 = 20.5L and tell him this seems to be a fair value because it can avoid a stalemate where both parties are stuck with their quotes. And also that you are extending your budget a bit and that, in order to arrive at a mutually beneficial deal, final price should not be too much of a loss to either party.

Hopefully this should take care of the deal. Of course these can act as pointers and the effectiveness of real time conversation is something which can not be guaranteed because of umpteen external factors - did this sound like a disclaimer from me?
Oh BTW, I hope seller is not a visitor/member here

All the best!!!

Edit - had a look at your profession on your profile. Apologies for the steps I mentioned above

Last edited by GTO : 15th April 2010 at 11:03. Reason: Strictly no more than 2 smileys per post please. Corrected
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Old 15th April 2010, 11:08   #162
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Quote:
Originally Posted by himavanth_m View Post
I am considering a 3 month old mercedes E 250 CDI (new model). The seller is asking me to quote a price. What would be the appropriate price to start bargaining?
This car has done approximately 7000KMs.
About 4 lakhs off the price of new. Wouldn't you rather have a previous gen E280 CDI for 10 - 12 lakhs lesser though? You could easily get a 2009 spec for 28ish. The E280 is also a V6 and offers unreal refinement.

Quote:
Also a BMW 320d highline 6 months old. Done about 8000 KMs. The seller is quoting 23Lacs. What would be the appropriate price for this vehicle?
Price is okay, though not a great deal. Reason = The Corporate ED 320d recently launched by BMW at 22.xx lakhs ex-showroom. Tell the seller that you don't care too much about the Highline's features and would rather buy a brand new Corporate Ed 320d. See his price fall

Good luck with the 320d. That, with a 5 year BMW BSI package, makes for a killer deal. Importantly, as Alok recommended, you MUST get a complete pre-purchase evaluation performed at BMW authorised.
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Old 16th April 2010, 19:51   #163
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GTO,

This is a great thread. Wish I read it earlier, I wouldnt have purchased a new car.
There are some excellent value used cars in the market. Your Civic is testimony to that.
I Just came across a similiar deal: Mint 9000KM run 07' SX4 ZXi for Just 4.6 Lakh A New car costs over 8 Lakhs. Thats saving of nearly 45%. The same covered by extended warranty upto 2011.
At price of a new i10 you would get a C- Segment fully loaded Sedan.
I am sure 3 years down the line the SX4 would retain much better value than a Brand New I10.
Lateral Upgrading is surely the wise thing to do!
wow!! that's a fantastic value proposal. the only problem i have with lateral upgrading is to find the deal thats really not going to change into a lemon. With the horror stories of dealers and the conmen who run them, am apprehensive to the true value of a used car, especially if it turns out to be more expensive and troublesome in the long run
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Old 17th April 2010, 23:33   #164
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While reducing the depreciation amount, which amount should be taken for calculation: ex-showroom price or on-road price?
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Old 18th April 2010, 17:07   #165
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Originally Posted by Anand123 View Post
While reducing the depreciation amount, which amount should be taken for calculation: ex-showroom price or on-road price?
Depreciation is generally calculated on the ex-showroom price.
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