I bought a car...

The insurance company gave me $6900 for my totaled alero and a rental car with a one week deadline before they would stop paying. They also provided through AAA a buyers service to help me find a replacement. It took a few days to search for an Alero and after thinking about it I decided that if I still had mine and it broke down a year from now I would say "that sucks" but if I bought a used car with the money provided and the same thing happened I would say "I got screwed".

So, I went with conventional wisdom and started looking at other used cars with a good track record -- ie. Honda and Toyota certified. What I discovered is that the depreciation on these cars was not too substantial. For instance, given my estimate that I may drive 25k miles/year I found these prices online:

                  NADA             Kelley
 2007     0k    $19,510     ---   $20,105    ----
 2006    25k    $19,175   $ 335   $18,590   $1515
 2005    50k    $16,062   $3113   $15,235   $3355
 2004    75k    $13,925   $2137   $14,060   $1175
 2003   100k    $11,550   $2375   $12,275   $1785

With the exception of the difference in price when passing the 36,000 mile warranty the depreciation appears relatively constant. Looking at vehicles online at autotrader also confirmed this trend. This led me to look at new cars instead.

Next I considered a hybrid vehicle. The tax credit is down to $750 but I drive a heck of a lot of miles, so looked at gas savings. Things may change, I may start carpooling, I may get to telecommute a day a week, I may move closer to work, gas prices will change, so with all these variables considered I wanted to do a price sensitivity analysis. The Civic EX is rated 30mpg city, 40 highway. They Civic Hybrid is 40 and 50mpg respectively. I was able to get the Civic EX for Invoice price, but the Hybrids are in higher demand and would have been closer to MSRP. That is a difference of $4645 - $750 tax credit = $3895. How much would I save in fuel costs?

Well, my manager has a hybrid and gets only 43 mpg. Reviews online at Car and Driver also suggest that it is really difficult to actually achieve 50mpg. So given my driving parameters of 110 miles/day, 5 days/week, 46 weeks/year = 21,850 miles. Assuming an average gas price of $4.00, 38mpg on the civic, 43mpg on the hybrid, I could save $22.29/month in gas or $267/year.

I'm all for doing what's good for the environment, but even with the ridiculous amount of driving I do and escalating fuel costs it could take 14 years to justify the additional cost.

So, what did I get? I got a blue one.