Back in 1999, that was an easy question to answer in the U S of A. Three Letters: S U V . When I first started in the auction business these mastodons absolutely dominated the marketplace. You could go to the nearest Ford factory auction and quite literally pick out your colors, trim, and options. Want running boards, all wheel drive and a trip computer? Sure. Want it in Black with the all too common grey interior? Absolutely! Want to get it all in a model exactly like the Ford Explorer but call it something different for the hell of it? Well, why not!
The 1999 Mercury Mountaineer rang up at $30k loaded when new. 12 years, $4 gas, and 180k miles later, I bought it at a public sale for $1200. Should I…
Rent: SUV’s tend not to move these days. Everyone who rents a vehicle circa 2011 wants something with 4-cylinders and all the creature comforts. I could offer it for $140 a week and with a sunroof along with leather, it would get a few eyeballs. But it wouldn’t be a top pick and seeing that I now have a fleet of ‘Grands’ at this point (Marquis, Caravan, Voyager), I’m not sure if I should offer yet another sub-20 mpg vehicle.
Lease: Anything with a good leather interior and a sunroof should get at least $700 down. Finance the rest at $60 a week and 24 months, and you have an easy formula for a high return.
Every Explorer and Mountaineer I have ever financed has always ‘made the note’. A good prior history of maintenance always helps. But the 4.0L V6 and 5.0L V8 are pretty much bulletproof and parts at junkyards for the rest of the vehicles are as common as kuzu in the South.
Along with this is the advantage of working with older customers. A lot of older folks in my neck of the woods have shorter commutes and prefer comfort over fuel economy. Some are retired. Many work light retail jobs. But they strongly prefer to have luxury and don’t care too much about gas since their overall mileage is minimal. SUV’s and full-sized RWD cars are absolutely ideal for this market and I cater to this market quite heavily.
Sell: An older loaded up SUV with leather that’s been well kept should get around $2995. The miles on this one do hurt it a bit. But given the lack of good used cars out there it shouldn’t be much of the problem. By the time I recondition it I may have between $1500 and $1700 in it so overall it would be a decent profit if it got sold quick.
Keep: If the Mountaineer had some moderate cosmetic issues I would be tempted. Purchase a trailer with brakes for about $1500 and I can easily haul a vehicle to the lot after every auction. With all the vehicles I get at different sales, this could easily save me about $100 a week in transport costs.
For the general public who have light hauling needs these vehicles can be absolutely perfect. The V8 versions with all-wheel-drive can tow well over 5000 pounds and have plenty of luxury for the rest of the time. Throw in a few small changes to make towing safer (towing mirrors, trailer with brakes, a weight appropriate hitch) and you can move an awful lot of toys without venturing into pickup territory.
This is not an easy decision. What says you?