When I bought my 2021 BMW i3S, I knew it was a less-than-optimal financial move. In fact, my article on the purchase was titled “I Bought The Holy Grail Of BMW i3s Even Though It Was Probably A Terrible Financial Decision.” And yet, I went through with it, and every month since, my car’s value has dropped. It stings.
Other than my Moab off-road projects, I’ve never lost a penny on a car. Why? Because historically I’ve bought old junkers — oftentimes severely broken ones. These cars were dirt cheap, and solely by getting them running and driving I significantly upped their value.
Take my 2000 Chevy Tracker. At $700, this thing was dirt cheap, and so were all the parts. The water pump was $27, the harmonic balancer pulley was $20, the ECU was $100, the CV axles were $34 apiece — ridiculous. I probably had a couple of grand into it when I let it go for $3,450.
That salvage-title 1991 Jeep Cherokee XJ I bought for $2000? Well, I did have to replace literally every part on it, but I managed to get $7000 for it, which was more than I’d put in it (not accounting for labor).
Then there’s the minty-fresh manual 1993 Jeep ZJ five-speed that I bought for about $3000 and sold for $9,500 after probably pumping $2,000 into it:
There’s also my old Willys FC, which had cost me $1,500 (plus probably another $1000 in parts and fuel), and which I let go for $4000:
I also bought a 1979 Jeep Cherokee Golden Eagle for $2000, spent probably 4 grand on parts and on transporting it across the country, but ultimately got $8000 out of it.
And when I bought the cheapest BMW i3 in the country for $10,500, only to have BMW install a new battery and compressor, I knew I’d come out OK even though i3 prices were dropping like a rock. I managed to sell the vehicle for $11,300 in the end.
You get the idea. I buy cars with problems, and I trade a bunch of my time in order to then sell them with fewer problems for slightly more money.
That’s why purchasing my “Holy Grail” 2021 BMW i3S has been such a hard pill for me to swallow. I paid $30 grand for this thing, which itself was $27,500 lower than MSRP. So it’s not like I bought the car at the top of its depreciation curve, but I definitely didn’t buy it at the bottom, either.
Carvana has a “Value Tracker” that I’ve been looking at ever since buying my car. I recall the car was, per Carvana, worth ~$28,000 when I bought it for $30,000 (plus shipping and fees — in the end, I probably spent $34,000). You can see that now the i3 is worth, per Carvana, $22,000:
Obviously, Carvana isn’t the arbiter of used car values, but KBB puts the value somewhere between $24,000 and $28,000:
Both of these values are mileage dependent. Look what happens when I plug in 50,000 miles on the odometer instead of 25,000:
And when the mileage hits 100,000, the values tank even farther.
Obviously, value dropping with mileage is unsurprising, but this is just new for me. I’ve never owned a car that lost value over time/use, so just watching that Carvana graph and that KBB “private party range” drop and drop and drop — it’s hard!
Could I have bought a higher-mileage 2019 BMW i3 with a different color and maybe the same interior? Sure. And I think a more rational version of me would have bought that 62,000 mile white one on Carvana for $22,000. Sure, it had 2 years and 40,000 miles less on its CARB warranty, and it wasn’t Galvanic Gold, but $8 grand is a lot!
So I did, the one time, splurge a bit. Still, despite that prevailing guilt, I take solace in knowing that this i3 purchase was an anomaly. I’m not in the business of buying depreciating cars. I bought that particular i3 because it’s extremely rare (possibly 1 of 3 in that configuration on earth), meaning me waiting for it to depreciate would have meant not owning it at all. Also, I don’t plan on selling it ever; it is, in my view, the very best version of the greatest city car ever built — it’s truly perfect for Los Angeles. What’s more, it’s absurdly reliable, costs almost nothing to operate now that I have dirt cheap tires, and most importantly: I’m almost a year in, and I remain completely and utterly obsessed with this machine.
Still obsessed with this car. pic.twitter.com/1rSYnhEtDr
— David Tracy (@davidntracy) October 12, 2024
Six months later my ’21 BMW i3S, which gets about 5mi/kWh in the city and 3.5 on the highway, remains one of the best cars I’ve EVER driven.
Why? Because of how beautifully it fulfills its intended function (be the ultimate city car) without being boring.
I remain obsessed. pic.twitter.com/U2ap9GJQVn
— David Tracy (@davidntracy) December 9, 2024
I don’t plan to buy another depreciating car pretty much ever. Maybe I would for my wife, who may want something safe and newer, but I myself don’t really see a reason why I would need to go down that path again. The odds of another hyper rare, absurdly over-engineered car that’s truly the perfect daily-driver my living situation popping up is pretty much zero, so I’m happy to go back to buying 10+ year old cars.
If Scout decides to get rid of the bench seat option on the Traveler after the first model-year (and there’s no indication it will, it’s just a recurring nightmare of mine), I might be tempted. But assuming that doesn’t become a hyper-rare option, I’ll just wait until the Scout is 10-15 years old before dropping cash on it, because I’m not sure I can deal with this guilt anymore. And more importantly, I already have the daily-driver of my dreams right here in my driveway.
Top graphic images: BMW; depositphotos,com
If it meets your needs, is reliable and you enjoy driving it, keep it.
If it doesn’t hit all three, dump as soon as possible.
My logic is this:
My Mom and dad bought a duplex in their 80s. Soon after they moved in, my dad’s health went seriously south and for the 3 years they lived there, dad was in and out of the hospital nearly weekly. When my dad passed away, the value of the duplex had tanked (2008 financial crisis). Even though my sister and I knew that mom would loose $100k+ on selling the duplex, we encouraged her to sell it because the only memories she had of the place is watching my dad suffer there.
If this i3 is making your life difficult, take your bath and move on. But if it is something you enjoy, enjoy it. There’s more to life than money.
I made money on almost every car I ever had until I had kids. Now I’ve sent two to the crusher and a third is on the way.
And when a baby comes along, you’ll be singing a whole new tune.
“It was a great car, but I have responsibilities now.
And yeah, I took a big hit, but I feel good knowing that I did the right thing.”
And you’ll probably even believe it.
Alternatively, when a baby comes along, mount one of the many child seats that fit in the back, get a reasonably sized foldable stroller which can fit between it and the passenger seat ahead of it when collapsed, and live happily ever after. Speaking from personal experience. These cars baby Exceptionally well. My wife, myself, and our 6 month old fit in there in world class comfort, along with a stroller, And we have a whole extra seat leftover, and an empty trunk. Oh and we are both just shy of 6′ tall. the i3 is an absolute keeper if you start a family in the city. Just make sure it has an Rx 😉
Wait, what kind of website did you start?
As an enthusiast, a car has a value proposition for the entertainment value it gives me. I figure if it usually gets me where I need to go, and I get a few laughs along the way, it’s been good value.
I’m kind of in the same boat with my Roadster: I paid effectively top dollar for it. BUT, as it’s not an investment, I don’t bother checking what I could sell it for—cause I’m NOT GONNA. I wrote that money off when I handed over the check. I had already come to the conclusion that I had to do so—or I couldn’t afford to buy it.
I get that, but I only ever keep cars 2 years at most before getting bored and moving on, so for me I try to get something towards the bottom of the curve so it doesn’t cost me a ton. For the most part I break even or even make money on the cars I choose to enjoy for a couple years.
Depreciation isn’t the car losing value, it’s you extracting value from the car. Every mile you drive is value that you get, that’s the car’s job, and its value is directly correlated to how many miles it still has to give you. That’s why you profited on your “non-depreciating cars”, you’re bolting miles back into them when you do major repairs. In truth, every car you’ve ever bought was actually depreciating. Without intervention they would all make their way to zero pretty quickly as they ran out of life.
The market expectation of newer cars is that they have 100-150k miles in them before they become “worthless” (usually meaning they’ll require maintenance in excess of the monthly payment delta to a newer car), but these assumptions are mounted on the idea that everyone always wants the newer alternative and will jump on the idea as soon as it’s financially viable. for $30,000, you bought the assurance that the car will give you lots of relatively untroubled miles without asking much of you, you’re paying for your own time, which you would’ve been spent fixing an older example.
You’re used to buying miles with your time, and getting some money at the end because you gave the car more miles than you took, but you’re Editor In Chief now, you’re selling your time to The Autopian for money, and you can then use that money to buy miles. That’s what most people do. It’s not a bad deal.
The only way you can lose money on a depreciating car is by not driving it.
Well said.
Ah yes, this is what most of us refer to as “owning a normal, functional daily driver.”
It may have a new battery but the next owner if faced with getting a replacement from TEMU with little to no recourse if it fails – or bursts into flames. BMW for sure won’t help you, for any price. It’s not just a battery, it’s an entire, complex customized system integrated into the vehicle and you can’t count on handyman retrofit repairs to carry the day. This car, like all others, is destined for the scrap yard.
Fun fact: I service a motor starter for a scrap yard that operates a 5000HP shredder. Drop in a Chevy pickup – and they don’t even drain the fluids or remove any parts – and it takes less than 5 seconds to convert it to confetti. I think an i3 would make it through is about 3 seconds.
Buddy. Why are you checking the value of a car you *don’t intend to sell* every month? That’s insane behaviour, even for someone who writes articles about buying and selling cars.
This is like, the automotive equivalent of making your wife log in to Tinder every month to assure yourself ‘she’s still got it’.
ahahaha you cracked me up.
Carvana thinks my 6-cyl BMW wagon is worth a grand. While I know with effort it’s worth 7-8, while “gone tomorrow” range is around 5k.
Meh, I do it too. I only bought my car in September and have every intention of keeping it minimum two years, but I am always interested to see what they are going for and keep close tabs on the market. If values randomly pop up higher I might consider selling early (not likely).
If we’re going to start applying financial sanity to automotive decisions life’s going to get pretty boring.
The road to stressful financial torment is always intense.
How are the tires and the battery?
At least David is still getting articles out of it, that is something.
Then again how long until another i3 article causes Members to degrade their upholstery to burlap due to boredom? (-;
It’s wild to present buying an affordable electric commuter car as an unwise financial decision, just because it doesn’t appreciate. It’s a machine that gets you places. It’s an expense. If your budget allows for it, you’re doing fine.
Outside of the occasional $70 million Ferrari 250 GTO, almost no vehicle EVER earns money as a financial play. Seriously, throw the original purchase price of your favourite meta-dollar classic into a historical S&P 500 investment calculator, (with annual contributions tracking inflation to account for maintenance and storage) and the the car’s current value never comes close.
It’s not a loss. It’s an investment in your relationship and your business. The time and sanity you gain by having a reliable and decent daily-driver lets you put that energy towards other things in your life.
I am definitely one of those people who believe that part of the key to happy old-car ownership is having one car that is new enough that you don’t need to mess with it or think about it very much. And also one of those people who values peace of mind!
My dream is to live somewhere with good public transportation and a private garage so I can forswear reliable cars entirely. It’s unrealistic to get both, but that’s why it’s a dream.
A spinoff publication! “The Bus-topian!”.
Come to Chicago – that’s what I have. Except it’s still helpful to have a reliable car, both because it sometimes pays (because I value my time) to drive to work (my commute in recent years has been about 15 miles, I can do it almost door-to-door via train, and I can ride my bike anywhere, but driving is shorter) and because the old cars don’t get subjected to winter. When my office was five miles away I never, ever drove to work unless I was going to Michigan for the weekend directly from the office.