Auditor's Confusion - Need Reliable Petrol Hatchback

[NH08]

I am considering to buy a new car and presenting my requirements as well as my opinion about various cars before all of you to please guide me. It is another thing that guiding me also needs some financial expertise on your part.

Requirements-
i) Petrol only
ii) Average running 500-600 kmpm mostly on long drives (once in 3-4 months). Therefore, car should be decent on highway/long journey. Rare driving in city for office commuting. (I am living in a place in central Delhi where public transport facilities are at their best – three metro stations, two train stations and one city bus terminus within one km radius of my residence. So no problem in going to any of my dozen plus offices –So many offices? – hint: my introduction).
iii) Mileage is not so important thing. Just that car should give atleast 17-18 on highway.
iv) I intend to retain the car for atleast 7-8 years so build quality should be decent. No tin ka dibba after some time.
v) Budget – 4.5 lakh (on the road), extendable (how much? That is the advise I would like to have from you)

Now my opinion about various contestants-

Alto K10 – Good but space is somewhat lacking
Figo – good but doubtful about its mileage
Wagon R & Estilo – Height is too high for safe driving at speed.
Ritz – unable to digest its rear
Beat – unable to digest its front
Punto – Why it sells so less?
Fabia & Polo – Heard that their 3 cylinder engines are noisy plus spare parts are so expensive.
I10 – Heard that ride gets bumpy for rear passengers. Tyres are small. Is this ok for long drives?
Swift – Good
Liva – good but interior quality?

There is one more car that I have not mentioned but it is just perfect for me (in fact my dream car) except that it is beyond my budget. New Jazz.

Now my question – what should I do? And options are:-

1. Take the best car suited for me among the above mentioned cars (except Jazz) (No loan would be required, all of my savings (approx. 4.3 lakh) would be wiped out plus some borrowings)
2. Take loan and take Jazz base version. Enjoy my dream car along with approx. 4000 Rs per month EMI and 0 Rs. in my savings a/c.
3. Take Alto K10. After some 3-4 years, change it with Jazz. (I expect to be financially comfortable by that time)
4. Take no car. Why car? This option convinces me once in a week.

I have been advised (by some learned people in my office) to buy a house and than a car but I am adamant that I would first move into a dynamic house and than into a static house. I have no liabilities except those of my small family.

So what should I do? In case your vote goes to option 1, which car?

 

[cooldhaya]

Re: Auditor's confusion

Being a car lover , i know how important a car is for us. So i would suggest a car even though we all know this is not the wisest of decisions considering your situation.


Punto seems to fit your bill perfectly but i am not sure if it can deliver 17-18kmpl in the highways. And why no i20 in the list? My friend's i20 gives him 18-19kmpl in well laid highways under normal driving with 80% AC , if FE is your main concern do add this too.


All your judgements about other cars are perfect.


Since your drives are going to be on highways mostly i suggest Punto , the car handles well and is quite stable at all speeds. There are lots of offers going for Punto currently especially Petrol versions.

 

[Surfer]

Re: Auditor's confusion

IMO - Would you like to go for a used car ?

1. You will get a car. Eg: In 3.5 L budget you can get a good 2006 + OHC,Hyndai accent
2. You will get a car and also you will save about 1L
3. In 3.5L you can get a sedan which will be good/comfortable for highway driving. Nice leg room + storage space helpful for long journeys.
4. During festive time there will be many good cars in second market.

OR if you don't like/want old car then
Go for Honda Jazz go with your heart. Enjoy driving. Don't wait for tomorrow and enjoy today.

 

[AMG]

Re: Auditor's confusion

Wait for the Brio.

If you can digest the animated manga character look, that is.

 

[drivetech4]

Re: Auditor's confusion

I am considering to buy a new car and presenting my requirements as well as my opinion about various cars before all of you to please guide me. It is another thing that guiding me also needs some financial expertise on your part.

Requirements-
i) Petrol only
ii) Average running 500-600 kmpm mostly on long drives (once in 3-4 months). Therefore, car should be decent on highway/long journey. Rare driving in city for office commuting. (I am living in a place in central Delhi where public transport facilities are at their best – three metro stations, two train stations and one city bus terminus within one km radius of my residence. So no problem in going to any of my dozen plus offices –So many offices? – hint: my introduction).
iii) Mileage is not so important thing. Just that car should give atleast 17-18 on highway.
iv) I intend to retain the car for atleast 7-8 years so build quality should be decent. No tin ka dibba after some time.
v) Budget – 4.5 lakh (on the road), extendable (how much? That is the advise I would like to have from you)

Now my opinion about various contestants-



There is one more car that I have not mentioned but it is just perfect for me (in fact my dream car) except that it is beyond my budget. New Jazz.

Now my question – what should I do? And options are:-


4. Take no car. Why car? This option convinces me once in a week.

I have been advised (by some learned people in my office) to buy a house and than a car but I am adamant that I would first move into a dynamic house and than into a static house. I have no liabilities except those of my small family.

So what should I do? In case your vote goes to option 1, which car?

Hi NH08, This are my personal views and need not to be taken as strong suggestion or advice. Well first of all rather than listing the options, make your requirements clear. I mean the Car features/ safety features/Must have features. Even if you finalize the model there would 3-4 variants and the price differences between base variant and top end variant is anywhere between 2 to 2.5 lac's.

As you mentioned, Take no car. Why car? This option convinces me once in a week. give it a thought with calculations, don't be emotional while doing calculations consider the inflation/ depreciation and Interest you would be paying/loosing what I mean by loosing I will come back to it.

I have no liabilities except those of my small family. [/B] Nowadays everyone is having the small family, but remember its a big liability, I would strongly recommend that do not spend more than 25 % of your savings you have. Keep the sum with you for incidental/medical expenses.

As you mentioned you work for Govt. you will get car loan at attractive rates, here is the calculation:
suppose you buy a car worth 5.0 l OTR
Loan amount : 4.0 L your contribution 1.0 L
Suppose you get a good deal on Car Loan at 9.0 % (I know this is difficult to get 9% ROI, but as you are Govt employee, you would be eligible for this- Please check the offer regularly, few days back Hyundai was offering 7.5 % ROI)your EMI for 3 year period would be 12624=00
Total additional amount you would be paying is Rs. 57916 +( 3000 processing charges)= 61000 aprrox

suppose you keep your saving( 4.0 L Rs) in FD in Bank @ an interest rate of 10 % p.a.(Which is the current rate for 3 year deposit) with compounding you will get an total interest of 132400=00, subtract the interest you paid, still you get 71400 more.( So you will be loosing 71400 if you use your savings and there would be liquidity crunch for you!
Do proper calculation do not spend your entire savings.

I have been advised (by some learned people in my office) to buy a house and than a car but I am adamant that I would first move into a dynamic house and than into a static house. I have no liabilities except those of my small family.
Remember Car is not an asset and its value depreciates very fast. So if it is not the need of the hour you can delay your decision.Also more Important are the ownership cost of the car. People only think that fuel is the only cost associated with the car but its not like that. There are Insurance cost every year, Maintenance costs, Incidental/breakdown costs, Enhancement Costs, Accessible and Spares. It all depends on your financials. I assume that you have your own house and people are advising you for going for the second one.

To summaries , To the mathematical calculations first, if everything is in line then surely go for your dream Car!

I hope I haven't confused you.

 

[NH08]

Re: Auditor's confusion

drivetech4, thanks for this comprehensive analysis of my situation.

I would strongly recommend that do not spend more than 25 % of your savings you have.
While searching on net for advice regarding financial limit one should have, I came across an opinion that one should not spend more than one years average savings on buying a car. My annual savings are around 3.2L.

Keep the sum with you for incidental/medical expenses.
At any given point of time, I need not more than 20000-25000 with me. For routine medical expenses, I depend on govt dispensary where everything is free.

suppose you keep your saving( 4.0 L Rs) in FD in Bank @ an interest rate of 10 % p.a.(Which is the current rate for 3 year deposit) with compounding you will get an total interest of 132400=00, subtract the interest you paid, still you get 71400 more.( So you will be loosing 71400 if you use your savings and there would be liquidity crunch for you!
Good idea. Will look for it.

Remember Car is not an asset and its value depreciates very fast. So if it is not the need of the hour you can delay your decision.
I feel that car for me is not the need of the hour but more of something in the form of enjoyment.

There are Insurance cost every year, Maintenance costs, Incidental/breakdown costs, Enhancement Costs, Accessible and Spares.
Any idea what would be the approx. value of other expenses (excluding insurance & fuel) for Jazz/swift per annum.

I assume that you have your own house
No. I am living in govt accommodation. And after living in its peaceful environment, location and availability of space, I don’t want to purchase a house in Delhi. Will do that after 5-6 years somewhere in a smaller city of Rajasthan.

surely go for your dream Car!
Why I want to hear that thing from everybody?

I hope I haven't confused you.
Absolutely not.

 

[drivetech4]

Re: Auditor's confusion

drivetech4, thanks for this comprehensive analysis of my situation.



surely go for your dream Car!
Why I want to hear that thing from everybody?

I hope I haven't confused you.
Absolutely not.

Hi Nh08, first of all thanks for considering my views.

At any given point of time, I need not more than 20000-25000 with me. For routine medical expenses, I depend on govt dispensary where everything is free.

That,s good to know you have medical facilities free of cost, but you can count on incidental cost; other than medical expenses. these are unforeseen expenses, and one should always maintain balance for the same.

I am living in govt accommodation. And after living in its peaceful environment, location and availability of space, I don’t want to purchase a house in Delhi. Will do that after 5-6 years somewhere in a smaller city of Rajasthan.

Start a recurring deposit with a nationalized bank , save monthly for your dream house. Interest rates are very attractive at this point of time.
I guess you are young and bachelor, if you start saving at this stage, it will be huge benefit for you.( I strongly recommend this.)

I am not preventing you from going for a car, but don't buy a car only because of enjoyment.

Any idea what would be the approx. value of other expenses (excluding insurance & fuel) for Jazz/swift per annum..

Consider anywhere between Rs 1000 to 25000, it is all unpredictable. For initial years after that it may rise.

 

[ashinhere]

Re: Auditor's confusion

Remember Car is not an asset and its value depreciates very fast. So if it is not the need of the hour you can delay your decision.
I feel that car for me is not the need of the hour but more of something in the form of enjoyment.

There are Insurance cost every year, Maintenance costs, Incidental/breakdown costs, Enhancement Costs, Accessible and Spares.
Any idea what would be the approx. value of other expenses (excluding insurance & fuel) for Jazz/swift per annum.

Hi NH08, I can understand your confusion as am going through the same but have now decided on Punto. My opinion are as follows:

For Point 1 above - If you do not feel that car is the need of the hour then it is highly recommended to wait till you feel the need. As now if you will go for car just because of the pleasure you want to experience then you will loose a lot. May be after 2-3 years you may realize that you have bought a small car but now you need more boot space or cabin space or may be safety features or some extra luxury features (you may have a budget at that time to go for 5-7 lacs car including money that you have spent on this car) but at that time you will not find it profitable to sell this car and buy a new one. You will really regret your purchase at that time. So IMO, first let your necessities define your requirement and then go for the car.

For Point 2 above - For any car if you are not driving it regularly the expenses on service and battery wear & tear will be additional as without driving much you will be spending on these. Also, as you are in govt job assuming you may have to shift from place to place, you will have to pay extra for car. So without utilizing it much you will be incurring much of your hard earned money on an addition liability (remember depriciation will also be there, which am not counting here as of now).

But if any how you have made up your mind and you still want to go for a car then I will recommend do not go for a car in which you'll invest your savings + will not drive much and also you will end up with 0 saving ( I mean Jazz). You should never compromise with savings. 0 savings and a car makes no sense.

I would suggest have look at Santro (CNG one) as company fitted CNG will reduce your fuel cost with maximum average. With CNG you will be able to cover distance within 200 km (one side) without swiching on to petrol. Places like Moradabad, Barelliey, Dehradun, Chandigarh and many other places near & around Delhi now have CNG pumps so you will not have to worry about petrol cost on highway trips near Delhi. Santro is fun to drive car in its segment (IMO) and is fuel efficient + good A$$ + Brand value + good resale + less maintenance cost + will fit in your budget without effecting your monthly savings.

Wish you luck with your search

 

[350Z]

Your office colleagues and our forum members above (drivetech / ashinhere) have provided some really practical and wise suggestions. Do not hurry about the purchase just because of the sake of having a car. Considering the given requirements, Honda Jazz does make sense and after all, when it is your desired car as well, I do not find a reason to compromise with it when the price difference is not so big, but buying a car right now for short term (read a couple of years) and then replacing it with Jazz does not sounds to be the best idea. Go for one as soon as you are financially comfortable and have already invested in the things which are more significant.

Drive Safe,
350Z

 

[NH08]

Thanks all for your mature advice. Seems that I should take a decision after considering everything and every aspect of purchasing a car rather than go emotional. Meanwhile, looking at just launched Brio S version at Rs.4.35 lakh .

 

[shailinder]

Your office colleagues and our forum members above (drivetech / ashinhere) have provided some really practical and wise suggestions. Do not hurry about the purchase just because of the sake of having a car. Considering the given requirements, Honda Jazz does make sense and after all, when it is your desired car as well, I do not find a reason to compromise with it when the price difference is not so big, but buying a car right now for short term (read a couple of years) and then replacing it with Jazz does not sounds to be the best idea. Go for one as soon as you are financially comfortable and have already invested in the things which are more significant.

Drive Safe,
350Z

I second Vibhor here and others who have suggested the same. Be wise and ensure that you spend your money wisely. Wait and watch and check when will you be in a comfortable position to go for a Jazz. Jazz is the best bet when we talk about petrol hatch and everybody here would agree with me.

 

[IntelligenceArtifi]

I think etios liva is quite nice. I have driven Yaris (similar to liva but overseas model) and it was excellant.