In a nutshell; the gravy train salesman company car has flipped and I will soon own the entire package.
http://www.runzheimer.com/business-vehicles/
I will have to purchase, insure, maintain, repair, wash, depreciate, license, and gas up a salesman related car. It will have to be 6 years old or newer and they said the total mileage of the car cannot be over 100,000 miles.
I drive around 20,000 business miles with another 5,000 personal. They pay you $0.23 per business mile and a fixed $350-$400 month overall payment. My monthly payout will be around $720-$765.
So you think I should..............
Yes...Then buy a Regal GS in 2012
/thread
doh...
uuhhh....get a 2011, then trade it in next year lol?!?
I could really live with a Cobalt SS Sedan personally, or the GXP G8 (although apparently the V8 is a hog, but the V8 is the only way to also get the proper qty of Pedals...depends on if you want a manual for DD or not). And I think the Fusion Sports arent bad looking either. I havent heard a lot about Taurus SHO except they pack a punch. Theres not really a new-ish dodge sedan Im interested in to be honest.
I have not personally lived under this plan but have worked under various plans over the years. My current gig is a provided Ford Escape that costs me $150 per month to cover "average" personal usage.
In years past I have gotten the "gov't rate" of about $0.50 to $0.55 reembursment for work miles driven on my own car.
Under a plan like that, what I found worked well for me was to buy off-lease, popular vehicles. I would buy a 3 year/36k mile offf-lease Hondas. I went through 3 this way. Back then I was buying the for about $10k. I would take them from 36k miles to 80k miles in about 2 years or less. With 80k on them, Hondas would still hold their value very well and my loss would be typically under $200 per each month owned.
As an example, I had a '95 Civic EX coupe that I owned for 18 months. In that 18 month time frame I took the car from 40k mile to 80k. After 18 months of ownership, i sold that car for $1,800 less than what I paid for it. $100 per month in ownership depreciation and one set of tires and one set of front brakes.
I have not had to stay under the 6 year rule but my B-I-L has to. He has been following a plan similar to mine with Buick Renzdevois. They can be bought cheap enough and provide both good untility and good hyw ride.
His new deal is similar to what you have been offered and he chose this time to go with a new CRV. I think he did a custom big mile lease on this one.
If i were choosing now, i think I would go with an off-lease Ford Fusion.
Another tip.
When you go to www.fueleconomy.gov and compare two cars, you can see a calculation of how much fuel dollars you will need at 15k miles and todays gas price. If you look into the fine print there you can change the calculations to meet your needs.
As an example you could than change it for 20k miles of driving at $4.00 per gallon (yes I think it will go up this summer.)
This will help you factor in what gas will really cost you.
My conservative approach would be to get a car for less than the flat rate money they are offering.
You have to figure where repair and insurance will be coming from. If you spend the entire flate fee for car payment then the insurance/repairs can not come from there.
At $0.23 per miles some quick math shows that at 15mpg you are getting enough money to cover $3.45 in gas.
At 20 mpg you are getting enough to cover $4.60 in gas
The math:
$0.23 x 15 miles in a gallon = $3.45 income for every gallon used.
$0.23 x 18 miles in a gallon = $4.14
$0.23 x 20 miles in a gallon = $4.60
$0.23 x 25 miles in a gallon = $5.75
You will want to know what type of driving you typically do.
Remember, you have to turn a profit in this equation to cover insurance aand repairs
They state that the $0.23 will change should gas prices fall/rise.
If I spend.......$350 month * 48 months = $16,800. At that level I should be running a spare $100 a month for repairs, tires, brakes and I would easily have 100,000 miles on this car at the 48th month. The fifth year would be a free car payment but probably a heavy repair year sinking the $350 into repairs or the next down payment as the cycle continues.
The company has been very generous with the past deal and I understand their thought of controlling costs. I just want to make sure that my company car is not going to personally cost a lot of cash.
I will bet that they will change the $0.23 price only anually. If so, some summer gas spikes could cost you. That is the way the "gov't rate" type programs worked.
What a program like this does for your employer is it shields them from variable expenses for the year. The only variable they have to endure is additional miles driven. Any repairs, insurance increases and gas price increases are all beared by the employee.
How much will your monthly insurance cost on a "new" car. That $100 you point out above also has to pay that insurance.
Are you a "highway man" or an "in-town" driver? How much traffic jam do you really see or are you on the open road?
That's been a pretty common plan for service techs for quite a few years. I don't know anyone on the plan who likes it.
The actual Runzheimer plan changes based on the vehicle you drive, the age of it, and your anticipated mileage. For example, when I was under the plan in the past, two of us with similar vehicles & driving similar miles may have wildly differing plans. One may have a higher base rate, but lower mileage; while the other may be just the opposite.
Oh, and the plan is only designed to compensate you for 60% of your company use, so make sure you have a good accountant who understands the plan and can help you claim your remaining balance on your taxes.
And one final comment - my condolences 
petegossett wrote:
And one final comment - my condolences
it also comes with a mandatory GPS that tracks where I go to prove my claim of business mileage is actually business. yeah, this should be fun.
Tinfoil over the GPS antenna during off hours?
pigeon wrote:
Tinfoil over the GPS antenna during off hours?
No problem - all personal mileage is unpaid and at my cost. I can drive all the personal mileage I want.
All business related mileage that I state is business is only paid when I turn the GPS on. They get a clear record of where I go and when and can then dispute my travels.
Mr jrw has the right plan. Buy something that has had the brand new depreciation worn off it, drive it until you are in the mid to high 5 digit odometer reading, and sell it while it retains some value. But something that has good resale- Honda not Saturn, if you follow. Don't drive too far- resale value is what you are watching here.
The real sweatheart deal is out of your range because of the mileage and age limitation. 240 Volvo, 2,000,000 miles, pocket 50-75% of monthly car allowance.
Oh, and while there were posted age/milage limits stated under the plan, they still paid the guys driving old cars - just not as much.
Streetwiseguy wrote:
The real sweatheart deal is out of your range because of the mileage and age limitation. 240 Volvo, 2,000,000 miles, pocket 50-75% of monthly car allowance.
How true. I was not held to an age limit and was getting paid about $0.50 per mile. In 2006 I found a dealer maintained 1995 Volvo 850 wagon with a 5 speed. It had 106k miles on it and I paid $4k for it. I drove it for 3 years and took it up to about 170k. I could afford to repair/replace everything it ever needed and still not spend nearly what I was making on the car; all the while getting about 25 mpg. My pet mane for the car was "the money maker"
I was driving that Volvo right up till the time they switched our program to provided Ford Escapes. I actually felt the Volvo owed me no money so I gave it to my brother for his son to drive. My brother liked the Volvo so much that he drives it and his son drives his 2001 Jeep Cherokee.
http://www.autotrader.com/fyc/vdp.jsp?ct=p&car_id=285549306&dealer_id=65628343&car_year=2009&doors=&systime=&model=FUSION&search_lang=en&start_year=1981&keywordsrep=&keywordsfyc=&highlightFirstMakeModel=&search_type=both&distance=100&min_price=&drive=&rdm=1296899475253&marketZipError=false&advanced=y&fuel=&keywords_display=&sownerid=56068889&lastBeginningStartYear=1981&end_year=2010&make3=&showZipError=y&make2=MERC&certified=&engine=&page_location=findacar%3A%3Aispsearchform&body_code=0&transmission=Manual&default_sort=newsortbyprice_DESC&max_mileage=&address=60431&color=&sort_type=priceDESC&model2=MILAN&max_price=&awsp=false&make=FORD&seller_type=b&num_records=25&cardist=109&standard=false
Here is the exact example of what I would buy in your shoes.
2009 Ford Fusion Sport 4 cyl with 5 speed manual. 24k miles on it. Asking $13k, offer $12k. Finance for 4 years and your minimum payment will be about $300 per month at zero down with tax and all factored in. I am not trying to "own the car" just pay off more than it is depreciating.
The car is 2 years old now so you can keep it for a max of 4 years. In 2 years it will have 75k on it, that is the time to unload it.
For comparison, a 2007 Fusion (2 years older) with 75k mile is worth $7k today.
Take your $12k purchase and subtract the $7k and this car could cost you $5k over 24 months or $208 per month.
If you just trade the car in and take the bad offer from a dealership of $1k less at $6k over 24months it still only costs you $250 per month.
Figure a set of tires and front brakes for $1k in repairs over those years (or average of $42 per month)
In my way of thinking you are hard pressed to consume $300 per month on this car. Yes, you are making a $300 payment but some of that may come back to you at the time you sell the car.
If they pay you $400 and you spend $300 on the car then you can spend the $100 on insurance.
If you can find a lease that offers 25k mile per year at a $208 to $250 per month than you may be better off but my guess is a lease like that will run you more like $400 to $500 per month, minimum, even on a simple car. You still have to buy tires and brakes for the lease car. Insurance on a lease car will cost more because it is newer.
MPG:
This 4 cyl and manual trans is rated at 20/23/29. At 23 combined:
$0.23 x 23 = $5.29 per gallon
20k miles will require 870 gallons at 23 mpg.
At $4 per gallon, 870 gallons = $3480 per year
$5.29 - $4 = $1.29 profit per gallon
$1.29 x 870 gallons = $1,122 profit per year. (or about the cost of insurance)
$5.29 - $3.25 per gallon (cheap gas) = $2.04 profit per gallon
$2.04 x 870 = $1,775 profit per year or $149 per month.
If all goes well with your 2009 Fusion, sell it is two years and buy a used 2011 Fusion.
Wash, rinse, repeat.
Here is another nice 2007 Milan with low miles but it is over priced at $13.5k. If you could get this priced at closer to $9 -$10k it could be a great deal for two years.
http://www.autotrader.com/fyc/vdp.jsp?ct=u&car_id=288975611&dealer_id=1147264&car_year=2007&doors=&systime=&model=FUSION&search_lang=en&start_year=1981&keywordsrep=&keywordsfyc=&highlightFirstMakeModel=&search_type=both&distance=100&min_price=&drive=&rdm=1296899475253&marketZipError=false&advanced=y&fuel=&keywords_display=&sownerid=56068889&lastBeginningStartYear=1981&end_year=2010&make3=&showZipError=y&make2=MERC&certified=&engine=&page_location=findacar%3A%3Aispsearchform&body_code=0&transmission=Manual&default_sort=newsortbyprice_DESC&max_mileage=&address=60431&color=&sort_type=priceDESC&model2=MILAN&max_price=&awsp=false&make=FORD&seller_type=b&num_records=25&cardist=103&standard=false
jrw1621 - thanks for all the great advice. I figure I will follow your plan as my goal is to not spend extra money to be in a Suburban but be in a more fuel effecient car.
I will get my "real" payout costs in a week or so to find out what they will be paying me for my "fixed" costs - or the payment of the car. For a company this is a good deal because costs become more fixed rather than crazy salesmen racking up gas costs.
I imagine you can pick this up for $10,000. I imagine I will also hate this car.
http://cgi.ebay.com/ebaymotors/ws/eBayISAPI.dll?ViewItem&item=330518346725&fromMakeTrack=true&ssPageName=VIP:watchlink:top:en
Ummm hello? They have a picture of the preferred vehicle for the program!
