Introduction:

It is common knowledge that today’s economy continues to present many challenges. The cost of goods is at an all-time high, and prices will stay the same for a while. Despite rising costs, certain items are needed to meet life's demands. One crucial need is a reliable transportation.

Vehicles are expensive, and in today's economy, consumers often need to decide to purchase a new car versus repairing an existing one. To help with this decision, here are some things to consider when faced with the need for a reliable transportation in today's economy.

Depreciation of New Cars

If shopping for a new car, depreciation must be a consideration. When a new car is purchased, depreciation begins as soon as the vehicle leaves the lot. According to lendingtree website, a new car loses more than 20% of its value in the first year of owning the vehicle. Within five years, the depreciation of a new car is around 40% of the car's original price.

Sticker Shock

There are many reasons for the recent increase in car prices. The cost of metals used in manufacturing is at an all-time high. The rising costs of electrical components, wiring, glass, and many other parts culminate in sticker shock. Given the state of the economy and rising inflation, there may be better decisions than getting into a new car. Consider the economic environment and whether paying for repairs on a used car would be better than going into debt.

Availability of Car Parts

For many, car repairs are a more sensible option than purchasing a new car. However, this approach can also have problems due to the availability of certain car parts. Almost every mechanic will say that car parts are becoming increasingly scarce. Some car parts that are difficult to find in today's economy are transmissions, steering components, radiator parts, and gearboxes, to name a few. If the car needing repairs is foreign, the problem worsens.  

Mechanic Rates

Another consideration when choosing to go the route of car repairs is repair prices. Shop rates are already expensive. Due to supply and demand, the cost of mechanics is higher than in the past. Shop rates must be a consideration when getting repairs done on your vehicle. If the money is available, working with a dealership has the best guarantees for getting quality parts installed by certified mechanics.

But using dealerships often comes at a steep price. If you shop around and research, individual mechanics can save thousands depending on the repair. The shop rates of individual mechanics can be considerably lower than dealerships. According to quora.com, average shop rates at dealerships are $150 an hour or higher.

Risk of More Debt in a Bad Economy

Consumers should review their financial position and determine if taking on more debt is the best option. High inflation, a tough job market, raises, and bonuses coming in lower are all critical areas to consider when purchasing a new versus repairing an existing car.

Often investing in car repairs is the more sensible action, but that does come at a trade-off. New cars with warranties usually cost less when needing repairs and can be much safer. A savvy consumer will look at their cash flow and repairs needed. These details can inform their decision on purchasing a new car, buying a used one, or making repairs to an existing vehicle.

Safety

Your family's safety is paramount. Safety should always be considered when choosing whether to purchase a new car or repair a used one. Minor repairs typically do not put safety at risk. However, when repairs are needed to the suspension, brake system, or steering, it is very costly.

The safety of you and any riders in the car outweighs all costs. Fixing safety concerns on vehicles is done daily. If choosing to have car repairs made to address safety concerns, it is essential to use a mechanic that is both qualified and experienced. Not only will the repairs be completed correctly, you will also have peace of mind – and you can’t put a price on that.

Conclusion

There are so many other areas to consider when determining the best option for buying a new versus making repairs on an existing car. These five considerations will get you started and thinking creatively about the best choice for a reliable transportation. No perfect formula fits every consumer, as each situation is different. But with careful consideration, you can have a reliable transportation in a poor economy while remaining financially stable.