Sell, Lease, Rent or Kill: 2001 Chevrolet Cavalier

Like the Chrysler LHS, this one was bought for $1000. A red, automatic 4 door model with power nothing and an aftermarket radio system. Florida, land of a million rentals was flooded with these vehicles ten years ago, and why not? It is an honest and decent piece of transportation that can go well north of 200k with proper maintenance. This particular one was bought at 150k with no paint fade on it. A very surprising plus for a car from Hotlanta. But the rear seat cushion has the usual ‘smile curl’ where the ends peak upwards due to excess sun exposure and let’s face it… this one is a parts bin special.

If I sell this vehicle I will probably get around $1800. Maybe $2000 to $2200 if I save it for tax season which comes in a couple months. A good version of these vehicles is often swarmed on Craigslist and Autotrader with hundreds of others that were abused to varying degrees. Cheap tires, cheap oil, and not so cheap financing arrangements for sub-prime finance customers are ‘the life’ for many of these sleds. This better kept version represents an unwanted rarity for the cash buyer. Many will test drive a couple of dogs and just give up on the idea of buying one. A wealthier or more credit worthy person will typically consider the far nicer competition that has a price premium to match it. But still an $1800 price represents a very healthy profit with little effort.

Renting this vehicle may be the best choice. I had a 1998 Pontiac Sunfire that had been financed a few months back. Although the parent was supposed to be the driver of the car, it was obvious that the 16 year old son became it’s owner with predictable results. An overdose of street racing, Lucas additives and non-certified oils blew the motor. I took the vehicle back and found a wrecked donor car with a good engine and transmission for $350. The Sunfire was fixed and since then it has seen consistent rental duty for the last several months and 7,000 miles. I have plenty of spare parts for the Cavalier should I choose to keep it.

Financing this vehicle would likely yield $500 down and $50 a week for anywhere from 50 weeks to 15 months. Economical vehicles have a red hot demand at the moment and if the cost of gas spikes past $3.50 next summer, you may likely see these vehicles come within a hair lick of a Crown Vic’s profit at the buy-here pay-here lots. The Ford may be far more durable. But the Cavalier is cheap and when a big chunk of a working person’s pay stub goes toward the gas pump, the gas guzzler gets replaced. I get several tons worth of trade-in’s during the July/August period from folks looking to better balance their commuting costs. Cavaliers, Sunfires and Saturns go for very good money during those times.

So should I sell it for the quick and easy profit? Rent it for a long-term return? Finance it for the same reason? Maybe a combination of scenarios would be the best way to go. What says you?