Junk a 2003/2004 Kia Minivan?

July 29, 2009 8:33 PM

Another cash for clunkers question. My mother has a 2003 or 2004 Kia Sedona minivan. The government website says its combined mileage rating is 16 mpg. It's got a lot of miles on it, not in great condition and probably not worth $4500 - trade it in for an efficient small car?

If I understand things correctly it would be worth $3500 credit if she bought something new that got moderately-OK mileage, and $4500 if she buys something smaller and efficient (Nissan Versa, Toyota Yaris, Honda Fit etc). The Sedona has the ugly distinction of being the poorest fuel mileage V6/3.0L size minivan in the north american market, and the overall quality of the vehicle was generally not so great to start with compared to a Honda, Nissan or Toyota.

It's got 100,000+ miles on it and is not in the best condition. Kias in the USA have crappy resale value. It would probably sell as a used car in the classifieds in her local area for sub-$4000 and that would take much time and effort.

Very rough math would work something like:

$15500 MSRP Honda Fit Automatic - 4500 credit * 1.08 to get car price after state sales tax = $10640 for a new Fit. Or whatever else is efficient and about $15000 MSRP.

Do it? Keep the junky minivan and fix it to 150,000+ miles? She no longer needs the passenger space for more than 4 people, or room for cargo with the seats out...

posted by thewalrus to travel & transportation (9 comments total)

Your calculations are probably correct - private party value on that looks like this:

Excellent $3,705
Good $3,355
Fair $2,930

I think your break even point on this for repairs is about $1000. Keeping in mind that the cash for clunkers deal is going to go on for a few months more (it has a total $ limit, not a time limit), I'd say go for it, if mom can afford a new car.
posted by bensherman at 8:49 PM on July 29

Yeah, do it.
posted by Netzapper at 9:47 PM on July 29

Seems like the alternative would be to soldier on in a big, junky gas-swiller with a bad reputation for reliability--for not too long before it will need to be replaced (and maybe have problems along the way)... when the cash-for-clunkers deal probably won't be around.

If the Fit or similar is essentially $11k and there's a couple grand to be got from the Kia, a cool new car for about $9k out of pocket or financed is a tasty deal. It's all the tastier when the alternative is pretty grim, could leave her stranded at any time, drinks about 2x the gas.

Assuming she can afford it, going for it or similar--and lotsa people like the Mazda 3--sure seems to make sense.
posted by ambient2 at 11:17 PM on July 29

Oops, slipped my mind that there's no trade-in for the clunker. Still seems like it makes sense. I know car prices vary in different regions, but I'd be surprised if she could get $3,000 for the Kia.
posted by ambient2 at 11:33 PM on July 29

She meets all the requirements, but two questions...

The CARS program website says:
The program requires the scrapping of your eligible trade-in vehicle, and that the dealer disclose to you an estimate of the scrap value of your trade-in. The scrap value, however minimal, will be in addition to the rebate, and not in place of the rebate.

How much is the scrap value of a 3500-4000 pound minivan? $200? So that's like a $4700 trade-in value?

Is the sales tax price of the new car calculated before the discount is applied or after?

$15500 compact car * 1.08 sales tax = $16740 - 4500 = $12240 approx

or

$15500 compact car - 4500 rebate from gov't * 1.08 sales tax = $10640 approx

Because that makes a big difference.
posted by thewalrus at 12:19 AM on July 30

You're math is way off, buddy. Order of operations and all. Try this:

(15 500 - 4 500) * 1.08 = 11 880

But yeah, it is a $400 difference.
posted by Precision at 12:52 AM on July 30

http://jalopnik.com/5324864/eight-ways-to-get-screwed-by-cash-for-clunkers/gallery/

A simple guide that should answer some questions too. And they say that the tax should be calculated AFTER the government rebate.
posted by Authorized User at 1:59 AM on July 30

Mrs. Fleebnork drives a Fit and loves it, so I can certainly recommend it.

However, I suggest you look around for dealers who may be matching Cash for Clunkers money. It might make your dollar go a lot farther.
posted by Fleebnork at 5:25 AM on July 30

Sounds like you might have to pull the trigger soon:
‘Cash for Clunkers’ Is Said to Run Out
By MATTHEW L. WALD
Published: July 30, 2009
WASHINGTON — After an unanticipated flood of applications from car owners under the “cash for clunkers” program, the government was reported Thursday evening to have exhausted the money for the program, leaving unclear whether applications would continue to be accepted.
posted by rigby51 at 6:37 PM on July 30