By on August 26, 2015

g33

Two weeks ago, I wrote about the slings and arrows of car2go membership. A few members of the B&B took issue with my claim that car2go was the cheapest way to operate an automobile. One of them decided to do the math.

And did he ever.

If you have a modern version of Microsoft Excel you can download his spreadsheet at this link. It doesn’t work perfectly in OpenOffice, but other than “Free Software” nutjobs such as myself I doubt anybody uses OpenOffice, so that’s totally fine.

“Being in finance allows me to separate hype from speculation (most of the time),” he notes, and since he’s one of our readers who hails from outside the United States, about sixteen hours by air outside in this case, I’ll give him a pass on the idea that “being in finance” and “speculation” are anything but joined at the hip. The spreadsheet allows you to plug in various values for leasing vs. buying vs. car2go. What I like about it is that it allows you tweak nearly every parameter instead of limiting you to fixed assumptions about pricing or residuals.

Having fussed with the spreadsheet for an hour or so, I can tell you that it is very difficult to make the numbers come out in favor of leasing or owning unless you really get funny with your assumptions or you plan for some very long trips behind the wheel of a Smart. But even TTAC readers who have no intention of ever getting behind the wheel of a shared automobile will enjoy the lease vs. buy calculations.

Some of us, however, require a little more out of our lives than the quiet satisfaction of knowing that one has thoroughly crunched the numbers and reduced one’s transportation expenses to a minimum, all the better to save a million dollars or so in today’s Bernankified fiat currency for an extra thirty days’ worth of life in a nightmarish assisted-living facility at the dementia-ridden end of one’s mortal coil. So our anonymous-by-request B&Ber has thoughtfully added a corner to the spreadsheet that allows one to plan a splurge with one’s savings. It includes a flight to California and an exotic-car rental. There’s even space for some expenses at the Chateau Marmont, where your humble author took a BMW i8 a few months ago and where it is possible, given the right combination of car, cash, and confidence, to engage in unprotected sex with someone who had a minor role in an episode of a made-for-cable sitcom. If that is not an incentive to save a bit on your daily grind, I don’t know what is!

I’d encourage you to download the spreadsheet and try your own calculations. Let us know how it goes. As for me — well, I compared car2go with leasing an Aventador or buying a Viper ACR, and I can state with conviction that the car-share service is definitely the lowest-cost option.

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39 Comments on “If You Drive A Smart Today, You Can Drive An Exotic Later...”


  • avatar

    SMART cars are ugly and driving them here in the tri-state area is like BEGGING someone to rear end you or T-bone you to death.

    If I was just driving around on a golf-course or in Disneyland, – year sure, a SMART would be OK… even an electric SMART EV.

    But around here, I prefer the comfort of knowing that I am in an armored car that weighs more than most crossovers and goes really, really fast in straight lines. Two of them.

  • avatar
    Undefinition

    This is fun! (Yeah, I said spreadsheets are fun. What’s it to you?)

    Can he make one for finding the optimal time to sell a car? This is a debate I got over and over in my head: is it cheaper to sell a car while it’s worth something, or to drive it into the ground?

  • avatar
    ...m...

    …i don’t have a computer, but tell me: does car-to-go still come out ahead of a non-depreciating used car?..

  • avatar
    S2k Chris

    But I’d be driving a Smart, and the only Smart I’m interested in driving is Amy Smart of Road Trip topless scene fame.

  • avatar
    windnsea00

    I always meet someone fascinating when I stop by Chateau Marmont for a drink…only if their food was better.

  • avatar
    Chicago Dude

    No surprise here. I lived about 4 years with no car because it made no sense to have one. I walked to work and the grocery store, bars and restaurants and all the other stuff an urban dweller does were all within easy walking distance. Parking in my apartment was a “discounted” rate of $185 a month and insurance was about $90 a month. Just those two expenses alone were more than what I spent taking taxis whenever I felt like taking one (admittedly not too often). Living downtown, the car rental agencies targeted business travelers, so weekend rates were usually less than $25 a day and once you had rented 10 or 15 times you had built up enough status that if you reserved the absolute cheapest option available you were given the nicest car they had when you showed up.

    I have kids now so the convenience factor makes it worth having my own car. We also take more trips out to Grandma’s house so maybe the rental option is more expensive. I don’t need to know.

  • avatar
    slance66

    For true urban dwellers it makes sense. One reason I’ll never be one again.

    One of the most important aspects of owning a car (or leasing) is that at any moment in time I can get in it and go where I like. No waiting. No scheduling. Cars = liberty. I will never give that up. It is invaluable.

    • 0 avatar
      S2k Chris

      “One of the most important aspects of owning a car (or leasing) is that at any moment in time I can get in it and go where I like. No waiting. No scheduling. Cars = liberty. I will never give that up. It is invaluable.”

      I’m with you 110%. I still remember the helpless feeling freshman/sophomore year in college (weren’t allowed to have cars until Jr year) when every single off campus errand became a huge chore without a car. Grocery store? No way. Rent a movie (15 years ago)? PITA. Dry cleaning (I was in ROTC and needed uniforms cleaned)? F no.

    • 0 avatar
      Maymar

      The flip side is the overall financial commitment of a car – freedom isn’t an extra several hundred dollars per month worth of expenses. Of course, even being a relatively urban condo dweller with decent public transit, I still have a car. But, having these sort of options makes it much easier to be a one-car household.

      Also, I can’t speak to any of the other carshare services, but I’ve never had to wait or schedule with car2go. If there’s a car available (and there usually is within a 5 minute walk), it can pretty much always be taken immediately.

    • 0 avatar
      stuki

      For true urban dwellers, even with a car, the only place they can go on a moment’s notice, is to the traffic jam that starts at the end of their condo complex’ driveway.

  • avatar
    krhodes1

    1974 Triumph Spitfire for when the sun is shining – $6K
    2001 Range Rover HSE for when it isn’t – $6K
    2011 BMW 328i Wagon for everything else – $40K
    2016 BMW M235i just because you wanted one – $44K
    The smug satisfaction of knowing you have your own little fleet of neat cars tucked away in the garage – Priceless!

    Ain’t nobody ever seen a hearse towing a U-Haul trailer to the cemetery…

  • avatar
    MrGreenMan

    I’ve had a string of young guys work for me as programmers. They all did the calculation on food cost within their first six months of having a real, full-time job. They then all experimented with the $3/lunch or $5/lunch approach to life.

    Nobody died; some got fat; a couple made out on the deal; one had to have some sort of surgery on his digestive tract; they had to upgrade the facilities, too – bigger pipe, auto flush.

  • avatar
    ReSa

    I used to work for a carsharing company called Greenwheels (.nl) way back when they started in 1998. over the years they’ve expanded massively. Sure, mostly in urban and highly populated areas like Amsterdam. I remember people being extatic about the fact that they didn’t have the hassle of owning a car plus all the parking drama in the big city.
    The nice thing is that they started differentiating a while ago. If you need a bigger car, or even a small van, you can get those at various locations across town.

    If you can let go of your irrational thoughts of ownership and are willing to be flexible in your mobility mix, carsharing works for 80% of the city folk!

  • avatar
    Undefinition

    Well, I’ve been playing with this spreadsheet, and the metric/standard conversions are kind of annoying, but as someone who lives and works in the suburbs, the car2go is showing up as quite expensive.

  • avatar
    wmba

    I spent forty years bowing to accountants. Most but not all had little clue about engineering projects and certainly none had design chops. But because of the power of the almighty dollar, I had to waste a lot of time trying to educate idiots in simple terms what we were attempting to do, and why we had prepared the budget we did.

    It doesn’t take an accountant or their spreadsheet enablers to state the obvious that not owning a car is the cheapest way to travel. I lived in London for five years and public transport was great.

    Now, if you do not live in what the Brits call an urban conurbation, a vehicle is essential because public transport is beyond poor. ZipCar doesn’t exist either – it’s an urban phenomenon for people too lazy to walk to the subway station.

    Why do these urbanists and the dressed as Tour-de-France crowd riding bikes think that we should all behave like them? I do not acknowledge their hegemony in any way, shape or form. To me, they are as idiotic as they think we are. Add on the veggie-types, the gluten-free crowd who believe in magic, the vaccine deniers and all the other bleating modern tut-tutters on every subject known to man, and I’ve about had it up to here. Mind your own beeswax and stay out of mine. I am a car enthusiast – deal with it.

    Here endeth Tirade 2307.

    • 0 avatar
      S2k Chris

      “I spent forty years bowing to accountants. Most but not all had little clue about engineering projects and certainly none had design chops. But because of the power of the almighty dollar, I had to waste a lot of time trying to educate idiots in simple terms what we were attempting to do, and why we had prepared the budget we did.”

      As an accountant who spends his days asking project managers and engineers to justify their budgets, let me defend my colleagues a little bit. It is YOUR JOB to justify your budgets. It is my job to push back on you and challenge you to be more efficient or creative or whatever, because that’s what the competitor is doing. I am well aware of my knowledge limitations, but often run into engineers who are not aware of theirs, in that they don’t see the bigger picture. For instance, I recently pissed off a guy because I asked him to take about $50k worth of contingency out of a $XXM project that he wanted to hold on to just because he might need it. What he doesn’t know or want to understand is that $50k across 10+ projects is big money, and can mean the difference between laying off or not laying off some of his fellow engineers. I generally have an excellent working relationship with my engineering teams, but a lot of that is trusting each other that the other has information we don’t know.

      Sorry, a tangent, but you hit a nerve.

  • avatar
    87 Morgan

    I’m in agreement with you here. I have zero intentions of giving up my fleet. Some guys play a lot of golf, work the spreadsheet on that gem, some hunt, so on and so forth. I like cars, I like to swap them out to whatever interests me at the time also.

    As for car sharing services? This is why I don’t live in the city….I’ll keep my three car garage thank you very much. But, if I suppose if I were a city dweller I can see the point.

  • avatar
    redav

    That SLS definitely a cool car, but the length of the hood just seems out of proportion.

  • avatar
    zamoti

    OpenOffice?! OMG is that thing just awful! I tried to use it as an Office replacement and although I’m not fond of Microsoft Products, there no replacing Office.
    That said, the only thing worse than OO is running MSO in WINE. That said, the spreadsheet opens just fine in OO.

  • avatar

    By keeping my paid for used car (added cost and 20% maint into spread sheet.) I say $75,000 over 10 years by driving used vs car2go I can up that to 35% repairs a year and still beat it by $72,000. i think I will keep driving cheap used cars it’s worked my whole life (never had a car payment)

  • avatar
    robc123

    addition:
    if you were to add this:

    =((J5*12)+(J15)+(J17/3))/12

    TO J31, it will give you the “real” monthly first 3 yr price of the used car- otherwise the yearly number is just a 10 year blended average. (see the lease pmt. is higher than the blended monthly cost as it is now)

    To meet, beat or approach car2go, think what you need to do:

    +Go old school just save up to buy a sub $20k car, pay for it in cash- don’t think about the cash vs avg. investment, keep it tight for as many yrs as 40% depreciation will allow and don’t exceed 10k KM a yr.
    +think about the times you want a Car2go that is underground parking- sometimes you cannot find it (gps) so feather your overhead with the occasional cab.
    +convenience, has a huge cost.

    to really sweat on how much a car costs, take your wage divide it by your yearly cost.

    Ideally, it would be Fiesta STs Car2GOs.

  • avatar
    stingray65

    You can do the spreadsheets to death and take all the joys out of life. Why spend a chunk of change on a nice sized house in good neighborhood when the spreadsheet says a tiny apartment in a bad neighborhood will save me big money? Why spend big money on steaks and imported beer when hosting friends for dinner, when I am sure they will be much more impressed that the spreadsheet says it is much more rational to dine on generic cheese sandwiches and tap water. Porsche, Ferrari, Corvette? – you must be crazy as a Nissan Versa can be had for a fraction of the price and the spreadsheet says it also offers 92.3% more cargo space.

  • avatar
    slow_poke

    having spent time in NYC parking is a problem. if you rent a space its significant, if you don’t, then you probably need to allocate for regular parking tickets. far cheaper to have no car.

    if you live further out, i had a ’80’s toyota pickup that was my daily driver. (~50-60mi/wk). put 40k miles on it. $2.3k to buy, put tires, shocks brakes and oil on it. sold it for $2.0k. insurance and gas were the high costs. gas you can’t get around if you’re driving that far.

    get’s you much better convenience than car2go. daily driver.

    you could get a much nicer one for $3.5k and likely sell in years later for the same amount.

  • avatar
    glwillia

    Completely unrelated note: OpenOffice is obsolete and basically unsupported, you should be trying LibreOffice instead.

    As for carsharing vs car ownership, I do both. I live in downtown seattle and take a car2go or Lyft whenever I need to run a short errand, and I own a manual E46 (fun to drive, almost completely depreciated) for weekend hiking trips + road trips. Parking does get expensive though.

  • avatar
    dal20402

    This post and the spreadsheet it links seem like they’re saying “transportation works differently in cities and non-urban places.” Well, yes. Parking a personal car is expensive in the city. Paying by the minute (or mile) is expensive in the sticks.

  • avatar

    That doesn’t quite work here in spread-out Oklahoma City. If you don’t have a car, you aren’t getting anywhere.

  • avatar
    madman2k

    I would have to rent it 5 days a week for 10 hours per day because I work on a military base and couldn’t just drop it off when I get to work, so I’d spend $65,250 on the car2go.

    My take home pay is quite a bit less than that amount, so that really doesn’t work.

  • avatar
    SP

    Interesting spreadsheet.

    Turns out that keeping my old warhorse as my commuter car should save me $10,000 per year versus using Car2Go. Great! (Not that I planned to try it.)

    Now what to do with the extra $10k? Hmm, take a cruise? Buy a case of champagne? Maybe … pay for housing? :)

    I think it’s easy to get caught up in the numbers and overlook a very important point:
    If Car2Go cost that much less than to own a car, then one or more of these things must be true:
    – Private drivers are being vastly overcharged for insurance and parking
    – People are buying or leasing way more car than they need
    – Car2Go is undercharging people and will soon go out of business

    So which of these things are true? You decide!

    • 0 avatar
      S2k Chris

      “If Car2Go cost that much less than to own a car, then one or more of these things must be true:”

      Uh, no. You’d have to do the math on what Car2Go costs to borrow 24/7/365 in order to make a comparison to actually owning a car, and Car2Go will be hyper expensive in that scenario.

      Averaged out, you are paying a much higher per minute rate for a car with car2go than by owning a car, BUT you’re only paying for the minutes you use. Think of it like the old unlimited voice vs. 200 minutes/mo cell phone plans. 200 minutes a month is much more PER MINUTE compared to the theoretical 43,200 minutes in a given month on an unlimited plan, but if you only use 190 minutes/mo, the 200/min month plan is cheaper overall than the unlimited plan.

      • 0 avatar
        SP

        I don’t think so. For one thing, it’s physically impossible for Car2Go to achieve total 100% utilization of their cars. There will be peak times when more than one person wants to use a particular car, so either Car2Go needs to have excess capacity or users will have to wait. That means there is plenty of time when each of those cars is sitting idle and nobody is paying Car2Go.

        It’s true that individual vehicle owners have far lower utilization of their vehicles than Car2Go does. But it’s also possible to share a car. Spouses do this quite often.

        Car2Go also has to pay someone to administrate this vehicle fleet.

        And they have a lot of risk with putting hundreds of vehicles in the hands of strangers.

        I can see the insurance as one area where they can really compete on cost – since they have very deep pockets, they can probably self-insure the vehicles.

        Car2Go, ZipCar, et al can certainly make sense in the right situation. But not in every situation.


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