Save money by buying a new car?

29 August 2014

Obviously it costs more to buy a new car than an old one of the same variety. However, if you are thinking of upgrading to a newer model, it could pay to go for the latest model, with new research suggesting that a new car saves 25% on running costs in the first year when compared with the same model five years older. looked at five popular vehicles, Nissan Qashqai, Volkswagen Golf, BMW 3 Series, Ford Fiesta and Vauxhall Astra, and compared total running costs- petrol cost, road tax cost, car insurance cost, MOT, servicing and breakdown cover of a brand new model with the costs for a five year old model.

The biggest saving of the five cars was the Volkswagen Golf, where a new car saved £422 on running costs, a 25% saving on the £1689 cost for a five year model. A brand new Ford Fiesta had annual running costs calculated at £1,237 per year, £351 cheaper than a five year old version. Similarly, a five year old Nissan Qashqai costs £1,804 to run per year, £243 more than the new car. In all five cases the cost of insuring the newer car was lower than the older equivalent models.

tablecar 1

tablecar 2

Dan Plant, consumer finance expert at MoneySuperMarket, said: “For some, buying a brand new car might seem prohibitively costly. However, with the drive from manufacturers to create more fuel efficient and safer models, as well as some 'free road tax for the first year' schemes, the cost of running and insuring a new car is often far cheaper than older versions of the same vehicle.”

TOPICS:   Insurance


  • Richard
    I think to make this realistic you should include depreciation as a running cost on a reducing balance basis. Eventually a new car will become a 3yr old car then a 5 yr old car etc. anyway so these numbers are only relevant if you plan on selling the car before it reaches this point, in which case you're going to lose a lot more by selling a new car after 3 years than you will by selling a 3yr old car after 3 years.
  • Dan
    Two words... Residual value.
  • Ian
    Misses the not insignificant depreciation cost though?! Wow, £422 saved. Let's ignore the several thousand extra it costs to buy the new car and the fact that they disappear the moment you drive it home.
  • Blue_Moon_23
    Depreciation over the first year compared to years 5-6?
  • Alexis
    So a new 1.2tsi Golf costs £18k and £1,267 a year to run An old 1.4 Golf costs £4k and £1,689 a year to run. New Golf = £6,422 a year over 3 years Old Golf = £1,896 a year over 3 years
  • Jack S.
    So you dont get anything at all for the car when you sell it then Alexis? 'tard.
  • Chris
    Road Tax my arse. There's no such thing. It's VED.
  • Alex
    Agreed This is stupid survey as depreciation / monthly payments are the largest costs so not to include these figures makes it the figures worthless. We all know most new cars get better mpg and are in lower tax bands buts the figures often don't stack up. Ie I purchase a 4 year old focus for £5k, Drive it for 3 years and sell it for £2k. Or I buy a new one for £15k sell it for £7k after 3 years. The first costs £1k per year depreciation, the second costs £2.66k per year. The difference in savings is never going to justifying buying the new car.
  • alland
    Does this information mean it might be better still to lease for 2/3 years than buy a 5 year old car with little residual value (ie now 8 year old car)?
  • Jessie J.
    ROLLERBLADES. The transport of the future!!

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