Is resale value important to you?

Well, if resale value isn’t important, then you’ve got a lot more money than me, gentle reader. In fact, by carefully looking at resale (often called ‘residual’) value, you can actually make some money when it is time to change vehicles. This is particularly so if you lease a vehicle.

Ferrari F360 Modena

However, taking the case of a vehicle on simple drip-feed, if at the end of your three year time payment plan the car is almost worthless, then you do not have a large deposit (or trade-in value) towards the next car, but if the residual value is high, then you have a sizable deposit, or trade-in, towards the new car which will either reduce your monthly repays, or if you want to keep the same repayment amount, it will allow you to move into a more expensive vehicle for the same monthly outgoings.

Sounds good? It should, because all this is very possible, but you have to be able to know what the residual value is going to be. This is usually expressed as a percentage of the original (new) price. After three years you should be able to get around 60 percent of the original price - if you have bought wisely!

Now there are tables that will show you how much you can expect for different cars and different mileages (kilometerages?). In the UK these tables are in a publication called Glass’ Guides. In Thailand there is a similar publication put out by Automotive Data Services (Thailand), otherwise known as The Red Book, and you should try and get hold of one. The data is amazing.

For example, which passenger car held its resale best? There is one that was still worth 72 percent of its original price after three years! Unfortunately, that car was a Ferrari F360 Modena, just slightly out of the average guy’s price range having cost 18.2 million baht, but the Honda Civic EK four door, originally costing B. 677,000 three years ago is still worth 67 percent of the original price today. That is worth real money!

In the passenger car field, the worst cars to have bought (as far as resale is concerned) according to the Red Book, were the SAAB 9-3 which ended up at 20 percent of the original (ouch), or the Audi A8 at 28 percent (ouch again), or the Volvo V40 wagon at 41 percent.

Looking at the most popular section in Thailand - pick-ups, then the best after three years were the Toyota Hilux at 68 percent, followed by the Nissan Frontier (63 percent), Isuzu D-Max (62 percent) and the Ford Ranger at 60 percent. Worst was the Mitsubishi Strada 4 door Grandis at 53 percent, but that is not too bad compared to the poor resale performers in the passenger car field.

And do you want to know the best vehicle to have bought three years ago? It was the Toyota Commuter bus, 3 door manual which had a new price of B. 964,000 and is still worth today 76 percent of that amount (that’s B. 732,640, so you can put the calculator down).

So if saving money is your aim, I’ll see you in your Toyota commuter bus next week!

New cars on the way here

One of the biggest news items in the automotive world involves Germany and Malaysia, where VW and Proton have formed an association so that Malaysia’s number 1 car maker will assemble VW’s to be exported to ASEAN.

VW say that they expect to generate more than 15,000 sales in the region in 2006, after the first VW’s come off the Proton assembly lines at the end of 2005.

Suzuki Vitara

Another company that is looking to market new cars here is Suzuki. Currently the Japanese manufacturer only produces the Caribean ‘jeepette’ here and imports the Vitara assembled in Indonesia. The word is that Suzuki want to build a small hatch-back here, which may be powered by a 1.3 litre diesel engine. In keeping with the concept of petrol misers, there is also talk of bringing in the Indian assembled 800 cc Suzuki Alto, to be part of the Thailand government sponsored ‘Eco Car’ movement. In 2006, the Vitara replacement will be on sale, but this vehicle will continue to be built in Indonesia.

BMW 1 series

Mazda will continue to bring in the Mazda3 (reviewed a couple of weeks back - a great car), which is manufactured in the Philippines, and the Ford Focus, which is also made in the same plant, will be imported. The Focus uses the same platform as the Mazda3, so should have similar dynamics. Mazda Sales Thailand are predicting sales of 10,000 Mazda3’s in Thailand in 2005.

BMW will also be trying to expand its market penetration with the new 1 series, which may be assembled in Malaysia if there is enough demand. With the 120i on sale here at 2.8 million baht, I cannot see there being a strong order book from Thailand, considering that you can buy a 323 for about 2.5 million baht.

Does a 10 year warranty excite you?

Well, Mitsubishi Australia certainly hopes so, offering a 10 year warranty program to try and stop the dwindling sales of Mitsubishi Down-under.

Following the catastrophic fallout from a botched warranty recall in Japan, plus some admitted cover-ups that ended up with some top level corporate hara-kiri, Mitsu saw its world-wide sales plunge steadily. I am also sure that the clumsy corporate Mitsubishi ‘nose’ is even more unpopular than BMW’s Bangle bottom, and will also have produced buyer resistance. Some rather outdated models in the range has not helped either - it really is time for a Lancer replacement before they bring out an Evo 23!

Mitsubishi Lancer

So in the face of buyer resistance, Mitsubishi Australia look like they might have found a rabbit to pull out of the hat. 10 year warranties!

Mitsubishi Australia president Tom Phillips has come out fighting with the new 10-year warranty campaign. “Not enough people are considering Mitsubishi, they don’t have confidence that we will be staying around in Australia to support their new car purchase,” said our Tom.

So to counteract that, they have come out with what they have called the Best Built, Best Backed warranty campaign, based on a five year/130,000km ‘bumper to bumper’ warranty on all Mitsubishi cars sold from now on, which is even transferable if the car is sold. A further five year/30,000km drive-train warranty is available, but only if the car is still held by the original owner.

This is actually some very smart corporate thinking by Mitsu Oz. Since most people only hang on to a car for three to four years, it means that the warranty will in most cases only be for the first five years, as the cars will be on their second or third owners by then (and no warranty for the second five years).

Mitsubishi have put aside AUD 9 million for a saturation advertising campaign, and if you think that is big bucks, it isn’t really. Mitsu sold about 61,000 cars this year in Oz, so even if they just hold station, that is only equivalent to less than AUD 150 per car.

Autotrivia Quiz

Last week, I mentioned that a heavy industry company began making Model-A passenger vehicles in 1917. The company is still in business today. It is not Ford Motor Company. I asked who is it? The answer was Mitsubishi.

So to this week. Amphibian cars have been produced for many decades. Some with greater success than others. Two that I know of were built by the same pair of optimistic enthusiasts in Cuba. The first was a 1951 flat-bed Chev truck with 55 gallon drums lashed to the sides to keep the truck above water. They floated this one to America, but were intercepted by the US coastguards, who had real boats! The aptly named ‘Cuba 1’ was shot and sunk by the Americans and the Cubans sent back to where they came from. I did say that they were nothing short of optimistic - they immediately began to build ‘Cuba 2’. This was based on a 1959 Buick and they packed 11 people into it and set sail for the USA. Once again they were intercepted by the coastguards and Cuba 2 was also sunk! So what I want to know this week is nothing to do with Marcel Basante and Luis Gras, the enterprising Cubans, but when was the first amphibian vehicle built?

For the Automania FREE beer this week, be the first correct answer to email [email protected]

Good luck!

Pencils out - here’s the 2005 Formula 1 calendar

The FIA have now released the calendar for next year, and it is a bumper year for Eff Wun buffs. 19 races in all, with the British GP and the French GP’s both on (after certain financial arrangements were made with a certain Mr. Ecclestone), if one believes everything one reads.

Here is the 2005 F1 Calendar

06 Mar: Australia Albert Park Melbourne

20 Mar: Malaysia Sepang

03 Apr: Bahrain Sakhir

24 Apr: San Marino Imola

08 May: Spain Barcelona

22 May: Monaco Monte Carlo

29 May: Europe Nurburgring

12 June: Canada Montreal

19 June: United States Indianapolis

03 July: France Magny-Cours

10 July: Great Britain Silverstone

24 July: Germany Hockenheim

31 July: Hungary Hungaroring

21 Aug: Turkey Istanbul

04 Sept: Italy Monza

11 Sept: Belgium Spa

25 Sept: Brazil Interlagos

09 Oct: Japan Suzuka

16 Oct: China Shanghai

The British GP has been moved from the original date so that it does not clash with the Wimbledon tennis, which is obviously a television reason, as I do not know many F1 fans that are such strong tennis enthusiasts that they would sit there all day watching the grunt-thump of championship tennis.

Bernie Ecclestone

The newest GP is Turkey (Istanbul not Constantinople) as Bernie pushes onwards towards the countries that will still allow cigarette advertising.

The best news is that Spa is still on the calendar. This is one of the best circuits in the world and the one that separates the real drivers from the ‘bought my’ drivers.

The bad news is that Monaco and Hungary are still on the calendar. Both of these venues can almost give gold plated guarantees that the race will be a procession. They go on about how important Monaco is to the history of F1 racing, but they were ready to give Silverstone the old heave-ho, the circuit that hosted the very first F1 Grand Prix in world history. What sort of dummies do they think we are? (Don’t answer that!)