Tuesday, May 20, 2008

The Geo is finally Cool!!!

The Day of Redemption has Come!!!

For years you have been the recipient of many jokes. Movies have been made showing your car smashed like a pop can. All of your friends stopped asking for rides years ago. Your family asks you to stop coming over in your car. Yes, this is the day of redemption. Yes, this is the day that your Geo has finally become cool.

This CNN article made me laugh... 

Seriously, I could have never seen the day that the Geo Metro would be sought after with such tenacity. And for someone to pay $7000+ for a 1996 model car that cost very little more than that when it was NEW is beyond me.

I was "talking" back and forth with Nikkala over Gmail earlier today and we couldn't pencil the car out as a good deal...  Here is the situation (in case you don't want to read the article):

  • A lady bought a 1996 Geo Metro on Ebay for $7300. 
  • A Metro XFI is powered by an anemic 1.0L three-cylinder engine producing just 49 hp, but it returns between 40-55 MPG.
  • Her current car (before the purchase) is a Honda Element that gets 28 MPG.
  • She has a 100 mile commute each day to work. 

So the question is, how long before she sees a financial benefit from having the Geo. I quickly ran and did some spreadsheet calculations and this is what I came up with for cost recovery (fuel ONLY)...

As you can see, I was only looking at fuel costs. I also gave the car the benefit of the doubt and gave it the whole 55 MPG (even though it will probably be less since it is over 11 years old). The time it would take to recover the cost of the Geo on fuel savings alone would be around 4 years, assuming gasoline stays around $4 a gallon. If fuel prices jump to $5, the time shortens to 3.2 years. If prices were to go even higher to $10/gallon, the time is even shorter at a little over 1.5 years.  

However, the true cost of any vehicle is much more than just fuel. The Honda will probably run for 10+ years without having any major mechanical problems. I'm not sure the Geo is going to make it 10+ years without some major mechanical problem (not because it is a bad car, but it is already 11 years old!)  There is also the problem of safety. Anyone who has risked their lives in one of these cars (or a comparable car like the Ford Festiva) knows there is very little metal between them and the 18-wheeler driving down the road next to them.

I'm all about saving money and fuel, but I think some people are a bit too quick to buy into higher MPG without looking at the real costs involved and the economics of the purchase. I'm going to bet my $1 that this lady never saves a dime with this car... you are free to wager me with your dollar if you think she has a chance.


chartie said...

Man, if I had $7000, I would totally buy your GEO. Alas, I only have $6999, so I guess I'm out of luck. Sorry!

Down with Jugo Chavez! said...

Dude you should totally watch "Who Killed the Electric Car" it will change your life - I swear.

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