To many people, there is value in having to worry less about breaking down, not having to pay for repairs for 3 years, and, yes, the joy of owning a new car

Tony, that is very well stated. You are correct, I did leave some of the intangibles out of my calculations.

I don't think I mis-stated the numbers to quite the extent you claim, although you are probably right, they are high.

I was figuring on a more expensive car -- you are replacing a Mustang, so I figured to replace it with a really nice Mustang GT Convertible, well-optioned. That would run at least $32,000, maybe more, so a $10K depreciation in the first year might indeed be a possibility, but you're probably right, $6K might be more in line. How about $8K as a compromise?

And again, you caught me: I was looking at only the first year expenses; subsequent year expenses will be less.

As for insurance... maybe Alaska is more expensive (relative to other places) than I thought. I was just making up numbers based on what my insurance is costing me. All I carry is liability insurance, and I'm paying well over $1,000 a year.

In the real world, I'd be surprised if your actual cost of ownership came in at less than $0.60 to $0.70 a mile.

If I came across as anti-new-car, well, it's kind of because I am. I have known too many people who get pressured by slick car salesmen (Sorry, Heather! ) into buying new cars they cannot afford. I watched in horror as a poor army PFC got talked into financing a POS Ford Escort on a 60-month loan, where the payments were going to take at least 70% of his total net income. He would be "upside down" in that loan until the day he made his final payment, at which time he'd have to pay the wrecking yard to come and take it off his hands.

I've always gone by the rule of thumb that if you can't pay a car off in 36 months (24 months would be better yet), you simply cannot afford that car. But, we're getting pretty far afield from the original premise: is it more economical to fix your old car or buy a new one? It is almost always less expensive to fix the old one. However, once you add in those intangibles, the equation changes somewhat.

I imagine General Motors is relieved that that is the case!

tanstaafl.