Buying a car
We all know that buying a car is never an easy task. As I love to optimize everything in my life, I was thinking about a way to find a car that offers the best value/money ratio. Let’s see how I did it.
Choosing the cars you are interested in
Let’s start by choosing some cars we want to compare. In my specific case, let’s say I’m interested in buying one of the following cars (I’ll limit my picks to only 5 for the sake of simplicity):
- Volkswagen Passat
- Volkswagen Golf
- Audi A3
- Renault Megane
- Opel Astra
Find the price evolution over time
Having a list of cars we want, let’s find what is the price evolution over time (in euros) for each one.
But before we can plot a price history, for a better accuracy, we will consider the average of 5 samples for each car-age pair as follows:
VW Passat
| Age | Sample1 | Sample2 | Sample3 | Sample4 | Sample5 | Average |
|---|---|---|---|---|---|---|
| 1 | 34 500 | 29 999 | 26 030 | 31 746 | 32 000 | 30 855 |
| 2 | 15 800 | 22 700 | 17 500 | 22 700 | 19 990 | 19 738 |
| 3 | 14 500 | 10 400 | 13 325 | 16 590 | 10 599 | 13 082 |
| 4 | 6 999 | 11 850 | 12 650 | 9 200 | 10 600 | 10 259 |
| 5 | 10 450 | 8 699 | 10 799 | 8 900 | 10 300 | 9 829 |
| 10 | 5 550 | 4 250 | 6 350 | 5 600 | 6 100 | 5 570 |
| 20 | 405 | 1 237 | 1 500 | 2 100 | 900 | 1 228 |
We can see a high variation in the initial price of a Passat, mainly because of the many available customisations
VW Golf
| Age | Sample1 | Sample2 | Sample3 | Sample4 | Sample5 | Average |
|---|---|---|---|---|---|---|
| 1 | 29 700 | 18 990 | 19 170 | 20 870 | 16 800 | 21 214 |
| 2 | 11 390 | 9 950 | 15 400 | 17 000 | 11 390 | 13 026 |
| 3 | 9 800 | 10 950 | 12 000 | 10 680 | 9 990 | 10 684 |
| 4 | 8 400 | 9 780 | 7 700 | 9 300 | 11 990 | 9 434 |
| 5 | 7 999 | 10 000 | 8 750 | 8 000 | 7 590 | 8 467 |
| 10 | 2 450 | 3 900 | 5 360 | 4 390 | 3 490 | 3 918 |
| 20 | 1 400 | 652 | 900 | 1 100 | 950 | 1 000 |
The main variation in price is due to the available sport options.
Audi A3
| Age | Sample1 | Sample2 | Sample3 | Sample4 | Sample5 | Average |
|---|---|---|---|---|---|---|
| 1 | 35 130 | 26 470 | 32 200 | 30 140 | 28 231 | 30 434 |
| 2 | 18 500 | 19 800 | 26 950 | 16 650 | 18 490 | 20 078 |
| 3 | 18 000 | 16 490 | 20 500 | 18 499 | 14 900 | 17 677 |
| 4 | 16 000 | 9 890 | 12 000 | 11 499 | 15 999 | 13 077 |
| 5 | 9 700 | 9 950 | 12 100 | 9 700 | 10 800 | 10 450 |
| 10 | 4 200 | 5 950 | 5 100 | 6 700 | 7 500 | 5 890 |
| 20 | 1 250 | 500 | 2 500 | 1 200 | 1 500 | 1 390 |
Like the Passat, the A3 has lots of options to choose from, which leads to a higher variation in the initial price.
Renault Megane
| Age | Sample1 | Sample2 | Sample3 | Sample4 | Sample5 | Average |
|---|---|---|---|---|---|---|
| 1 | 19 799 | 18 500 | 14 680 | 15 500 | 19 950 | 17 685 |
| 2 | 9 990 | 15 500 | 11 000 | 10 700 | 10 950 | 11 628 |
| 3 | 7 850 | 8 670 | 12 000 | 5 999 | 8 199 | 8 543 |
| 4 | 7 150 | 5 990 | 6 000 | 7 150 | 7 350 | 6 728 |
| 5 | 8 700 | 6 400 | 5 750 | 5 900 | 5 333 | 6 416 |
| 10 | 2 890 | 1 909 | 3 300 | 2 350 | 2 590 | 2 607 |
| 20 | 600 | 900 | 1 200 | 750 | 1 200 | 930 |
Having lesser options, the initial price of the Megane is pretty stable.
Opel Astra
| Age | Sample1 | Sample2 | Sample3 | Sample4 | Sample5 | Average |
|---|---|---|---|---|---|---|
| 1 | 12 398 | 17 287 | 11 990 | 19 300 | 13 448 | 14 884 |
| 2 | 15 950 | 13 500 | 18 590 | 9 600 | 10 500 | 13 028 |
| 3 | 8 150 | 6 580 | 7 415 | 11 500 | 9 750 | 8 679 |
| 4 | 7 300 | 7 400 | 8 500 | 6 699 | 9 350 | 7 849 |
| 5 | 6 250 | 8 499 | 6 250 | 7 500 | 5 590 | 6 817 |
| 10 | 3 499 | 4 390 | 2 600 | 3 499 | 2 500 | 3 297 |
| 20 | 850 | 1 000 | 850 | 900 | 550 | 830 |
Like the Renaul Megane, The Opel Astra has a smaller initial price range.
Price Histogram for all 5 cars
Taking the averages for each car-age pair and putting them all together, we end up with the following table:
| Age | 1 | 2 | 3 | 4 | 5 | 10 | 20 |
|---|---|---|---|---|---|---|---|
| VW Passat | 30 855 | 19 738 | 13 082 | 10 259 | 9 829 | 5 570 | 1 228 |
| VW Golf | 21 214 | 13 026 | 10 684 | 9 434 | 8 467 | 3 918 | 1 000 |
| Audi A3 | 30 434 | 20 078 | 17 677 | 13 077 | 10 450 | 5 890 | 1 390 |
| Megane | 17 685 | 11 628 | 8 543 | 6 728 | 6 416 | 2 607 | 930 |
| Astra | 14 884 | 13 028 | 8 679 | 7 849 | 6 817 | 3 297 | 830 |
Now, let’s plot this histogram in excel
Conclusions
Looking at the graph above, a few conclusions can be extracted:
- The price for luxury cars starts pretty high, but it drops significantly after the first year, so buying a new car is not recommended.
- The Volkswagen Golf depriciates at a slower rate than the Passat and Audi.
- The Audi’s price drops significantly after the first year, but then it manages to do a better job at maintaining its value, unlike the Passat. Maybe because of the more premium quality of the components. But I think the main reason is that the number of Passats is higher, so a bigger offer in the market leads to a lower price.
- All 5 cars depreciate quickly after the first year, but if you want to buy a new car (and plan to sell it after a few years), then Opel Astra is a good choice, as you will get a better resell price. It also has the best initial price of all.
- If you plan to buy a used car, then the best moment is after 3-4 years, because after this period the price starts to decrease at a slower rate than the reliability does.
