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-   -   Used Luxury Cars might be cheap to buy, but they are expensive to maintain! Any solutions? (https://www.team-bhp.com/forum/indian-car-scene/234481-used-luxury-cars-might-cheap-buy-but-they-expensive-maintain-any-solutions.html)

Hello Everyone,

I guess whosoever is a member here, has affinity towards cars in some or other way, Some are modification lovers, some enthusiastic drivers, some admirer of the beauty in the design while some ohers just love to travel in them.
Unfortunately owning a car needs money and usually a bigger aficionado you are, more money you would require to realise your dream. While some of the lucky ones have all the money in the world, most of the remaining people struggle in one way or the other. The realm of preowned cars is one way of achieving the Niravana for an auto enthusiast but I have found one big obstacles in its course. Today every preowned luxury cars is within the buying capacity of most of us but still we can not do it as maintaining them would still be eye watering costly affair(primarily due to costly spares) , which we would like to avoid.
So there are cars and there are their potential buyers and things stop there. Why! Because there are no enablers or a conducive environment for this activity. I fail to understand, why is it so. I am sure, the car companies would definitely benefit, from the higher number of their new car sales as customers would be confident about realising good resale value and also the maintenance of preowned cars would help the companies gain profit through sales of spare parts, servicing etc. A thriving preowned car business would not hurt government as it would generate employment, taxes etc. If such is a case, why is there no such initiative either by the car companies( their current preowned car programs still do not solve our problem, as the cars are still prohibitively costly to own and maintain).
I believe out there, there is a solution for every problem. We have not found it yet as the key players have still not worked hard for it.
Meanwhile, we the T-BHPians can at least talk here and find some effective way forward out of this conundrum. After all who doesn't want to own a Merc or an Audi. So please forward your ideas, no matter, how off the tangent they sound to you as they may not for others.:thumbs up
regards

Let's get one thing out of the way. There is no such thing as a cheap luxury car.

- A brand-new luxury car is expensive to buy and expensive to run. Maintenance, pricey extended warranties, insurance with zero dep, usually dismal FE, tyre costs etc. add up to a fat packet.

- A used luxury car might be cheap or VFM to buy, but will be very expensive to run.
An immaculate old E-Class might cost you just 12-lakhs, yet its maintenance costs will be in line with a 60-lakh car (i.e. what it cost when new) & not a 12-lakh one.

Here is what an in-warranty 5-Series cost me. Quoting from my ownership thread:
And another one:

Here is where I disagree. As a big believer of VFM fun, I don't think it's necessary to spend big bucks for "nirvana". Give me any budget - even just 4 lakhs or 15 - and I'll give you excellent used / new options that are loads of fun to drive. Related threads:

Best enthusiast cars in India

Even regular cars can be fun

Car manufacturers are primarily in the new car business in India. And other than one or two rare exceptions like the Fortuner, every expensive car suffers heavy depreciation at the time of resale. The expensive maintenance is one reason for their steep depreciation, as few people want to bring home a white elephant.

True. But the statement is perhaps more valid for a high volume Maruti True Value than the luxury segments.

Maintenance is obscenely expensive at authorised workshops because of their costs + profits + imported spare parts + strategy (a 60-lakh Audi owner isn't price sensitive and won't blink before paying 50 grand for a service). If anything, I have only seen the maintenance costs increase with time.

If you want fair maintenance costs, you have to find a good independent. But even then, things can get expensive due to the iffy reliability of old luxury barges, imported parts, complex mechanical + electronic nature etc. I further believe that today's luxury cars aren't built for over 10 years intended life.

Also, if you have your eye on upkeep costs, it's probably better to get a newer C-Class / 3-Series / A4 than an older E-Class / 5-Series / A6. Lastly, the 4-cylinder engines will be cheaper to buy & run than the 6-cylinders. Don't go anywhere near an S-Class or 8-cylinders if you are price sensitive.

There is no easy solution to this, unless these luxury car manufacturers start heavy localization of parts. Look at this recent thread on gloster's minor accident:

https://www.team-bhp.com/forum/stree...6-5-lakhs.html

Only one possible way is, buy an immaculate and relatively reliable luxury car for ownership and badge purpose, which you can take out for a spin on good roads for fun/showoff. But you must have a beater car for everyday run. In other words, play safe with your luxury car and worship it in garage during 70-80% of the time.


Look at this video where he explains maintenance cost of S class: https://www.youtube.com/watch?v=XD0UG_EKed0

My comment for above video: I did quick math, considering depreciation costs, maintenance, fuel expenses etc. It boils down to: It costs 300/- per km running (in this specific case). In another words bangalore-hyderabad-bangalore trip would've costed 3.6 lacs

I hope you don't find a solution. It might just stop the depreciation of luxury cars similar to Toyota/Maruti which sometimes see an increase in price with age!

You can. For instance take out the expensive complicated air suspension from that luxury German sedan and make a regular coil spring according to the required dimensions. But then the 'Luxury' factor is instantly gone out & you no longer get the magic carpet ride like feeling. These components are expensive due to their complicated engineering and fewer applications unlike mass segment cars.

I feel thanks to the current times, you really don't need an expensive luxury car to enjoy many things. The likes of a Safari or City offer so much new age features and conveniences while cars like the Magnite even come with 360 degree camera. Want to have fun driving ? Take the Polo or a Rapid. I would say only go for an expensive car, if you can truly afford it.

Few links on similar discussions:
https://www.team-bhp.com/forum/luxur...ar-budget.html

https://www.team-bhp.com/forum/india...car-india.html

https://www.team-bhp.com/forum/super...ust-india.html

I think GTO mentioned a lot of good points already. Let me give my perspective on this topic from an European point of view. Many of the arguments against are, I feel, India specific. And they are probably related to (hate that phrase) market maturity. What I might consider as a given here in the Netherlands, might be a long way in the coming in the Indian market

1 Buying second hand
In many countries buying your car second hand as default is completely normal. Here in the Netherlands most folks buy their cars second hand. The number of second hand cars sold outnumbers the number of new cars by a good margin.

So there is no “social stigma” or status attached to it. And everybody does it. You can be a CEO and still own a second hand car. For many people owning a car is first and foremost a mode of transportation. And financially it is very attractive to own a well maintained car. Depreciation on cars is, irrespective of make/model still a huge factor.

2 Hassle free reliable maintenance

Cars in India lead, by and larger a more harsh life that cars in most of Europe. Car maintenance is heavily regulated and controlled. There is a lot of transparency in maintenance record, MOT (annuals safety/emission check), no mileage tempering etc.

3 Reliable competent indepent workshop

We have a very large bases of indepent workshop. Partly because of what I mentioned under 2, it is easy to maintain a second hand car properly outside of the official (brand) dealers. Warrantee is not affected either, by law.

4 Parts supply and prices

There is a huge network of different parties that can provide any part, be it OEM or alternative, immediately. All workshops here in the Netherlands get parts delivered at least twice, sometimes three times a day. Even on my classic car, I can order via the Internet and have it delivered on my doorstep within 24 hours.

So parts availability is not an issue at all, and prices are on the whole pretty decent and you have multiple sources to choose from.

5 Brand independent specialist

We have a lot of independent workshops, specialising in a particular brand, sometimes even model. I get my Jaguar X308 serviced by one of these shops. Looks after about 550 X308s in the Netherlands.

Some of these independent specialist have more knowledge and are better equipped to deal with second hand luxury cars than the original brand dealer.

The truth is of course that those people who buy new tend to stick with the main brand dealer for the first 3-5 years of ownership. But then they, or the second hand owner will move to the independent shops. So these become very knowledgeable and experienced dealing with these cars up to say 10-15 years of age. If I take my Jaguar X308 to a Jaguar dealer they might not have worked on one for months!

It is very challenging to maintain competence, tooling and parts for low volumes of cars. Even for mainstream dealers. And no matter what, an older car is going to require some more maintenance.

AS GTO mentioned earlier on: in general luxury cars might be more expensive to maintain than more regular models. And that would still be the same when it becomes older. But then again, regular maintenance on many cars up to 100.000 kilometers tends to be very predictable and is not a huge consideration in the total cost of the car.

On luxurious cars the big tickets items tend to be tyres (usually you need high speed rating tyres and they cost 4 times as much as regular ones). And when major maintenance is required it might get more expensive too. (e.g. replacement of a distribution belt/chain)

Going by the number of topics we have on “electronic problems” in car and how problematic it is to get these sorted by either main stream dealers and or indepent shops also is an indication that there is serious competence problem in across the board in India. Luxury cars have lots of electronics and complex systems. It takes years of experience and lots of continuous training to get people up to the correct level of competence. Difficult enough to stay up to date with new model, but even more so to maintain competency levels on older levels. Doesn’t come by itself. Requires commitment and acknowledge of requiring substantial investment in staff and equipment. (which also means you need to have a sufficient business volume to make it work financially)


Jeroen

This is only going to get worse. As car companies slowly become tech companies, and get valued by stock market as such, keeping old cars will become as meaningless as repairing your ten year old PC or mobile. Even an old
Vertu phone you paid $20k is as good as a brick in few years.

LCD panels, electronics, chips all have lifetime and rapid tech obsolescence. OTA updates will cease. Google won't run anymore.

Sadly this will also apply to cheap cars as much as they do to luxury ones.

Thanks for starting this thread.

I am wondering what happens to these thousands of cars.

1. How much percentage of these are retained by the owners for long term.
2. How much percentage are sold off after warranty (for upgrades or after claiming enough depreciation by business owners or corporates).
3. More importantly, given the high maintenance costs post warranty, what would be the eventual fate of such marquees?

Cross posting this image from a different thread.

.

Thanks GTO, your replies are always a source of wisdom.
I agree with almost all of your answers but I wish to exhort others to find a solution to the problem. Apparently there seems to be none but it could be just apparently.

E.g. one way of practically making it possible as per humble opinion as I am not an expert, is to sort of providing a service, one like the medical insurance. The provider may charge a premium for covering the maintenance of the vehicle. It may succeed, if the premium to be paid, comes about half of the otherwise expected cost to the customer and the customer base is large enough to bring profits to the provider.

regards

Agree with you that the luxury cars are expensive to maintain.

Thanks Jeroen for your detailed and a very insightful reply. You have brought a very valid point that this problem is mostly in India or India like countries' and the main reason behind that is lack of strict regulations and the status of the maturity of the market. I believe regulations also partly depend on the market demand or maturity.


Hi Voyager-1

You are bang on the target that there are already so many cars in the market and more so there would be in the future. This is a fact. Now what I wish is that can't there be a win win solution for all the parties. There certainly is but what and where, we will have to find out.

Thanks

Luxury is when we beyond the "need" to "want" and manufacturers are "greed"y. Assuming the quality of construction is good, doesn't a 5 BHK bungalow require more upkeep (regular daily cleaning, painting every 10 years, carpentry, plumbing etc) than a small 2BHK flat? Same thing with cars.

If Mercedes/BMW/Audi heavily localizes parts and makes their cars cheaper to repair, people won't upgrade to a newer models - which threatens the premise of your post:

Why? Because Luxury cars won't depreciate much if they are cheap to repair and the used market (relative to the size of the market) will be smaller than what it is today.

I have bought a lot of cars used! But never dared to think of a German car. I personally lose sleep if my car is not in perfect reliable condition!

I dial down my used car budget by a significant margin so that I have enough cushion for proper upkeep and maintenance.

Trying to save money on maintenance of a complex car, only results in more pain. There are very very few reliable FNGs who can handle the complexity of these machine! Take my word for it!


Its better to have a well run and maintained Polo than a poorly maintained Mercedes. The peace of mind is important to me!

I am not sure if this is possible in India. In New Zealand (I am sure this applies in other countries too), you can buy any used car and purchase a third party warranty cover. They don't cost much and cover for unforeseen mechanical and electrical breakdowns up to $8000 per claim. The excess varies depending on the warranty cover. Most folks who buy 7 to 10 year old (or even older) European cars opt for this as repair costs are even more than India due to hourly labor rates.

As an example, if you buy a 2013 Audi A5 2.0T for about $20,000, third party insurance will set you back about $3000 for 3 years.

A colleague had bumped his car as a result of tailgating The car was a 2012 BMW 116i. The front left headlamp cluster needed replacement. Ordering the part was easy but the cost for doing the job and re programming the ECU to accept the new headlamp cluster was going to set him back almost $4500! Lucky for him, the car was still covered under third party warranty cover. He had to cough up $500 excess and that is a lot less than paying $4500 for a headlamp cluster replacement job. What shocked me the most was the need to reprogram the ECU for a simple job/part like this, which could only be done by BMW as his FNG garage was not equipped to do this.

General maintenance can be handled by a competent FNG and does not cost a lot more than a non or semi luxury brand. Its only when certain critical parts need replacement, or when they fail, where it tends to inflate the bill.

You need to do your due diligence before you head down the road with a luxury car. While a particular make and model of a car may pull your strings, you want to make sure its not a lemon model of the lineup. Check the car thorough before you put down your hard earned money. If you are not hands on with cars, get an independent garage to inspect the vehicle. Even if you have all the warranty cover, there is no fun in owning a luxury car if its going to sit in the garage for a couple of months a year.

That Audi I listed above was a car I keen to buy. I was also looking at a 2013 Mercedes S300L that cost less than the Audi! While I did not end up buying either, its easy to guess the model to avoid.

Bang on! I have seen so many such people in Bombay who buy a luxury car in immaculate condition just for badge value/show off and will start the car once a month to warm the engine. I wonder why would they spend so much on a luxury car just to create a strong image of themselves.

On the contrary, does that really help in bringing down annual maintenance costs? I always thought such cars tend to rust faster, low battery life etc.

A very interesting thread, for sure!
I have always been a fan of used luxury cars and both, me and my father have bought some of these and have driven them immensely.
In no way can anyone say that the maintenance of luxury cars be at par with that of the regular, mass cars but you pay for that exclusivity. And if you yourself involve your being into the maintenance of these cars, maintenance remains bearable. Also depends on the car that you have.
My family bought a brand new W203 C200 drove it till the end of 2019 when the car had done around 1,10,000 km. This car typically is famous for its unreliability, a fact that I can agree to without any doubt. In the last 3 months that we had the car with us, both its fuel pumps, the voltage regulator (MB suggests to change the whole alternator) and the brake master cylinder were changed. Spent some good money in mending all this but surely almost 50% less than what the dealer would have quoted.
I believe that used luxury cars can be the go to but you need a good independent garage and you will have to source your own parts and also to buy intelligently. A Lexus would need much much less maintenance than a German/British luxury car. A regular service for my 2005 Lexus LS430 at a Toyota workshop is never beyond Rs 20,000 bucks and fortunately, I haven't seen any part failures. I got the car at 60,XXX km and now it stands at 1,18,XXX km. So, buy intelligently and maintain intelligently and you will have a big car with small money and medium maintenance.
Sorry for being lame in the last line.

People who can own such cars are much more likely to fly than drive intercity. They would even fly from Mumbai to Pune / Bangalore to Mysore.

Some of them, perhaps even in a chartered / owned aircraft :-)