JimNYC

I've been keeping track of our car expenses over the last 8 years. As it turns out my 2006 S500 costs me only $2k more per year than my wife's Honda Accord ($6k versus $4k). And this isn't just the argument I make to her...it's true.

Both are great cars, but which would you rather drive?

(Details: In 2008, I bought a 2006 S-Class (my third) with 35k miles for $50k. I drove it for 8 years (to 111k miles) and traded it in for $7k (true value) towards a 2013 S550. I also spent $5k in maintenance and repairs. Annual cost: $6,000. In this same 8 years, my wife bought two Honda Accords. Her total cash outlay for these cars was $30k and $2k for maintenance and repairs. Annual cost: $4,000.)

IMHO, the best car deal in the world is a 2-3 year old, low-mileage, CPO'ed S-Class that you intend to hold for 6-8 years.

Although it's true that you probably won't get a million miles anymore out of any S-Class, which nowadays is really a giant computer on wheels, you will get 100,000.

BTW, I'm not rich...I just like a comfortable ride at a sensible price. At $500 a month, the S-Class cannot be beat.

bzliteyear

great point, but i'm not sure i follow your math...perhaps you can explain further as the #'s don't really add up the way you wrote it.
also, how do you get $500/month on 2013 S-class - my wife's new C300 is $370/month - and that's a lease, lol.
PL

JimNYC

My last S500 cost me $50k, minus the $7k trade-in, plus the $5k in maintenance, equals $48k. Dividing $48k by 8 years gives me $6,000 per year total cost. Dividing $6k per year by 12 months gives me $500 per month.

BTW...I've never held onto any other car for eight years, mostly because they are <<boring>> and require lots of repairs after 5-6 years. I should also note that luckily I have never needed a major fix (>$2,000) to the S's that I've owned.

PeterUbers

Costly repairs are more likely in the s class than the accord ... This Is my anecdotal observation

Ultimately it should be determined by which car you prefer to drive more and feel best in... But I get that when the costs of ownership become prohibitive ... Then it's not so fun to drive the nicer car

MTrauman

Agreed!


One of my clients had the air suspension go out on one of his S Class cars and the bill to repair was just under $10,000. So the OP has been lucky but if something major goes out on the used S class it will be costly.


Thankfully I have been lucky on all my S Class cars under warranty or not under warranty. But I am prepared if one of my S Class cars are out of warranty to shell out say $10k if needed on one of those major ordeals like one of my clients shelling out $10k.


On the other hand, my wife drives an Acura MDX she purchased new and now has 110,000 miles on it. I am not worried at all about a $10k bill just popping on the MDX like one should be on an out of warranty S Class. I cannot convince her to go back to MB since her ML that she had before the MDX had the motor replaced at 37,000 miles and she was very disappointed about the MB ML at the time and is now an MDX lover.


Bottom line--be careful on the used S Class cars since items can be very expensive to deal with if something goes out.

JimNYC

Exactly! This is about total cost of ownership versus what you get.

For me, there is no caparison between a Honda Accord and a MB S-Class which, if approached sensibly, cost just about the same on a TCO basis ($500/month versus $335/month).

Sure, if you have a serious repair with an S-Class car, the cost of repairs is going to be significantly higher than a more simple car, but that's the risk you take with anything that's expensive.

JimNYC

No question that the risk of a big repair for an S-Class is huge. But mitigating this is the factory warranty, the CPO, and the fact that you start out with a high-quality car...

I'm not making any profound point here...just saying that the three S-Class cars that I've owned have ended up costing me (on a Total cost of Ownership basis) basically the same or a lot less than all the Fords, Subarus, Volvos, Cadallacs, Mercurys, Hondas and other cars that I've owned.

So when people say my S500 is too expensive, I just nod and smile.

Quadcammer

$5,000 in maintenance and repairs over 8 years is, imho, well under the curve.

Set of tires alone is about a grand.

JimNYC

Good point...I forgot to include 4 new tires (which my wife didn't need to buy) which cost me another $1.2k. This brings my monthly cost up to $512 versus her $335.

Still no contest...cost versus what you get.

BTW, I did incur other repair costs under the warranty which I didn't include since this was not money out of my pocket.

drsaab

This is total nonsense.

In 2008 you got an s class and drove for 8 years. That would be till 2016.

How can you get TCO for a time frame 1.5 years from now.

Also your Wife bought 2 Honda accords in that same time.

Well she should not need 2 Honda accords in 8 years. They run much longer than a S class. And if she got a second Accord, then she has another 6-8 years to go.

Similarly you need to account the cost of your second S class to make it apples to apples.

There is some data on a 80k Tesla vs a new 40k Odyssey for 8 years out and they were similar based on $3.50 gas. But an accord vs S class being the same. Ummm.. nope.

I do know that I did calcs and my 2011 E350 BT over 6 years with the Unlimited miles cpo warranty was about $420 a month over that time frame. But I am now selling it after a year so that number went out the door too.

mklasse

Yup, if you bought your car in 2008, 8 years would be 2016, if you had just traded that car in for the 2013, then you haven't owned it for 8 years yet.
I also agree with drsaab, that you really have to compare TCO of 1 S-class vs 1 Accord for a fair comparison, not 1 S-class vs 2 Accords combined. Especially if the Accord is bought new, since new cars depreciate the most in the first and second year of ownership, right? (The depreciation alone would be different on 2 new accords in the period of 4+4 years of ownership vs 1 new accord in the period of 8 years of ownership)

Also, what about gas and insurance? Your V8 S-class drinks more than your wife's V6/I4 accord right? (not to mention the S-classes tend to love more expensive drinks than the Accord, gallon by gallon) and it would cost a lot more to insure the S-class over the Accord.
IMO to calculate true cost of ownership, you really have to factor everything in, not just depreciation and cost of maintenance/repairs.

bzliteyear

yep, and in addition, if you try that exercise for the next 7-8 yrs, i'm willing to give odds that it will be WAAAY more than $500/month.
also, i think it's important to factor in "cost of financing/opportunity cost" of buying the cars. it's not whether one can afford to pay for it cash or not, but that's a "real" cost.
p.s. my 2011 Odyssey insurance more expensive than my 06 S600 Sport, so insurance not always more on MB.
PL

petee1997

A two or three year old S class is always a good deal because of the huge depreciation. If a person is looking for luxury at an affordable price, this is it. One caveat, they are not economical if you plan putting a lot of mileage. The repairs and maintenance, once off warranty, can be exorbitant.

Jason B

If you use it like a 3rd car it would be.

hyperion667

I was planning on trading my '14 in on a brand new Honda at the end of warranty base model probably lol

MTrauman

mklasse

Yes, it is not because of MB, but the value of the car itself is one of the factors for the insurance premium, no? The current value of your '11 Odyssey probably is still higher than your '06 S600 too.
My point for the OP case, insuring a $50k '06 Mercedes back in 2008 gotta be more expensive than the $25-30k accord right? Assuming both drivers have roughly similar driving profile.

Wolfman

Depends. MB seems to have lower insurance premiums than other cars. $100k BMW is 20% higher on insurance than newer $125k MB SL with same driving profile.

C280 Sport

Well this is a cool write up... I cannot wait to see the one comparing a S600 to the price of a bus ticket. S Class and Honda should not even be used in the same sentence let alone be compared. One is a $100,000 and the people buying a S are not the same people buying a Honda Accord... There are ways to be smart and save money by DIY or using a local shop for repairs instead of the dealer. Also, converting the ABC or Airmatic to coilover.

JimNYC

Okay, you are all right...

My original (amended) assertion that it cost about the same to buy and drive a 2-year old S-Class and a 2-year old Honda for seven or eight years is just plain wrong. I admit it.

By my new and VERY ROUGH estimate, the Total Cost of Ownership (TCO) of the S-Class is more than twice that of the Honda...maybe a $1,000 a month versus $400. This is based on my personal experience with both cars as an owner and factoring in their initial cost, trade-in value, insurance, maintenance, repairs, operation, etc. to understand the true delta.

However, my main point is still the same...

For a relatively small incremental cost ($7.2k per year), I am driving a $115k (list price) Mercedes S550 and she is driving a $25k (list price) Honda Accord.

There is nothing profound in this conclusion other than the fact that the huge initial depreciation of the S550 makes the TCO cost of a CPO-used luxury S-Class very reasonable even compared to a very competent and very cost-effective economy car like the Accord.

bzliteyear

Nice update.
I agree with you 100% that going pre-owned on MB is waaaay better than than Accord - if nothing else, just for the peace of mind of being in a MUCH SAFER car.
That said, just like mutual funds disclaimer that past performance is not guarantee of future returns, I'm not so sure it'll work today for 2 yr old S-class vs. new accord 2x. From my observation, S550 on last yr of prior body W221 going for $70k vs. $25-30k for new accord? Just depreciation alone for next five to seven years will run $50k for the S550, or $8-10k/yr?
Bottom line, even if it's not the same, I still agree 100% that this is the way to go - especially if you care about your family's safety!
PL

JimNYC

I just bought an S550 (CPO, 2013, 28k miles) for $58k. The original list was $115k. My guess is that in eight years with 10k miles per year usage, this car will be worth about $10k.

$58k (price) - $10k (trade) = $48k (depreciation) / 8 = $6k per year.

These numbers are consistent with my last two CPO'ed S-Class purchases, which makes depreciation about half the TCO.

bzliteyear

anyone have thoughts about getting a 2013 Tesla P85 for $65k? That's 40%+ off MSRP, and from what i've heard, almost zero cost of usage(besides tires)?
PL