It’s a tough decision: should you keep maintaining your old vehicle, or replace it with a new one? You need to weigh up the costs and benefits of a new car against the ongoing costs of keeping your old one on the road. With the cost of fuel now so high, and the general cost of owning and maintaining a car on the rise, it’s more important than ever to make sure you’re invested in the right vehicle.

Your decision-making will be unique; it depends on your budget, your lifestyle and your preferences. You may not need a car at all anymore, or maybe your household doesn’t’ need more than one. Whatever your reasons, here are the arguments for and against replacing your old vehicle:

Reasons to keep your old car

• It will be much less expensive in the short term. Keeping your existing car can be very cost-effective, particularly if you’ve maintained it well and it’s running smoothly. The only time you might spend less by buying new is if your existing car needs a lot of expensive repairs and you’re planning to replace it with a relatively cheap second-hand vehicle. In every other instance, maintaining your current car will be much cheaper than replacing it.
• It’s convenient. No paperwork, no car hunting, no salespeople – no stress.
• You know your car. You know it’s reliable and all the features are familiar. If it’s not reliable, that’s probably a sign that it needs repairing or replacing.

Reasons to replace your old car

• A new car should be safer. Safety features evolve rapidly – buying a vehicle that is five or more years newer than your existing vehicle should give you some major safety upgrades.
• Better features. A new infotainment system, reversing cameras and compatibility with your phone; you should get a lot more features on a new car.
• It should be cheaper to run. Upgrading to a more efficient car, particularly from an Internal Combustion Engine (ICE) car to a Battery Electric Vehicle (BEV) or hybrid, will help to reduce your day-to-day running costs.
• Reliability. If your old car has started to become unreliable, or you know that it will soon start to need many thousands of dollars in maintenance annually, a newer car should remedy these problems.
• It’s time to trade in your old car. The older your car gets, the less it’s worth. Ideally, you want to sell it before it starts to need major maintenance.

Is this an ideal time to swap your ICE vehicle for a BEV?

As BEVs begin to become the norm on our roads, it’s likely that resale values for ICE vehicles may begin to decrease. At the moment resale values are still quite high, but as the popularity of BEVs grow, the demand for ICE cars will continue to decline.

Around the world, legislation is pushing markets to phase out ICE vehicles. Here in New Zealand, the plan is to ban the sale of new ICE vehicles by 2040. Electric cars will be cheaper to produce than ICE cars by 2027, according to international forecaster BloombergNEF, which should prove a tipping point.

With all types of cars in short supply right now, the market for ICE cars is still strong, which will help you maximise resale on your older vehicle. But once the supply of EVs increases, and prices align with ICE cars, demand for ICE cars will reduce and the resale value on your car may start to fall – slowly at first, then rapidly. The big question is when this will happen, and it is hard to know the answer to that just yet.

Talk to one of our experts at an AA Auto Centre near you

Struggling to weigh up the pros and cons of keeping your vehicle? Our expert technicians can help you understand how much maintenance you might be facing on your existing car – is it still good value or is it going to become a burden in the near future? We don’t sell cars, so you’ll get an independent opinion on whether this is a good time for an upgrade.

And if you are in the market for another car then make sure to check out the AA Motoring Preferred Dealer Network. An AA Preferred Dealer is a Motor Vehicle Trader that has been certified to meet our standards of quality.

Happy driving!

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