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Date:         Fri, 8 Dec 1995 19:21:31 -0600 (CST)
Sender:       Vanagon Mailing List <vanagon@vanagon.com>
From:         dakhlia@wuecona.wustl.edu (Sami Dakhlia)
Subject:      about the REAL cost of ownership

Allow me to add my few dollars to last week's thread...

This is just a back-of-the-envelope calculation containing everything I could remember, including recommended investments such as CHT and oil pressure gauges. It does NOT, however, include those little "optional improvements" such as solar panels or heated seats :) Neither shall I include related psychiatric or other medical treatments and pharmaceutical expenses (Zantac and Minoxidyl) :O

For comparison sake, it is important to weight the inputs (parts and labor) with the same prices (wages) as those used in other calculations (such as in Consumer Report, for example), i.e., labor must be priced at what a good mechanic would charge you (about $60-70/hour at the dealer here in MO), *even* if you did the job yourself. Of course, we also need to guestimate how much time the expert mechanic (not Joe's Garage) would have spent, which is usually less than the typical listmember. Keep track of how much time the owner really spends on his repairs and infer his worth from that. Parts, too, should be weighted at what the dealer would charge for them if he (the dealer) installed them, but I won't do this here for simplicity sake.

I drove about 47,000 miles in 4.5 years. Bought it for about $3,000 and would sell for about the same (if forced at gun point); hence no depreciation. (Of course, had I invested that money instead in, say, a bond with 5% return, I would have earned about $150 a year. Normally, this opportunity cost should be included, too, but I'll spare you that today.) "labor (me)" may seem high, but includes reading and thinking. "labor (professional)" is just a bunch of unbacked guesses; correct me if you know better.

parts labor (me) labor (prof.) 18 oil changes (Syntec) & tune-ups $40 x 18 3 x 18 1.5 x 18 exhaust (#1) $130 3 1 exhaust (#2) $50 8 2 rebuild $800 80 20 gauges $110 8 3 fighting corrosion $250 40 20 4 tires (XZX reinf) installd $400 - - fuel/vacuum hoses $100 6 2 new alternator (installed) $440 - - fuel injection problems - 20 2 ? fuel (2,900 gls.)x $1.15 $3,380 TOTAL (maintenance-no fuel) $3,000 239 hours 78x$60=$4,680

Hence, not including fuel, maintenance cost was $0.16/mile. Include fuel, and the cost was about $0.24/mile.

Now how much of this did I pay off with my own labor? That's $4,680/239 = $19.58/hour, the wage I pay myself for doing my own work. Alternatively, the cash-only-cost per mile is $0.14, counting fuel. Don't count fuel and we're down to about 6 cents per mile for parts.

-- Sami ('75 Westf.) dakhlia@wuecona.wustl.edu http://wuecon.wustl.edu/~samid/


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