Why Are Cars 2nd Hand Cars So Expensive

[markg]

I just dont get the price of 2nd hand cars here.

They are so expensive when i compare them to the UK.

I looked around in Phuket. Here's a couple of examples.

1. A 12 year old Mitsubishi Lancer. About 200k Kilometres. Ok condition for year. 150k baht.

2. A very basic 12 year old Totoya Soluna. About 300k Kilometres. Base model. 225k baht.

That's just silly money. And they were about the cheapest cars on the lot.

The downpayment on these cars was 30k baht. I'm pretty sure that in the UK, the total cost of these cars would be 30k baht!

What gives?

Is this just a Phuket thing? Are they a lot cheaper elsewhere?

[stament]

I just dont get the price of 2nd hand cars here.

They are so expensive when i compare them to the UK.

I looked around in Phuket. Here's a couple of examples.

1. A 12 year old Mitsubishi Lancer. About 200k Kilometres. Ok condition for year. 150k baht.

2. A very basic 12 year old Totoya Soluna. About 300k Kilometres. Base model. 225k baht.

That's just silly money. And they were about the cheapest cars on the lot.

The downpayment on these cars was 30k baht. I'm pretty sure that in the UK, the total cost of these cars would be 30k baht!

What gives?

Is this just a Phuket thing? Are they a lot cheaper elsewhere?

I can't comment on the cars you mentioned above. However, from my limited experience it appears cars don't depreciate that much in Thailand, whereas in the UK they depreciate about 30% from new the minute you drive off the forecourt !!!

[Crossy]

Just the way it is.

You'll find that the cost of ownership of your 'expensive' used car in terms of what you get for it when you sell is much lower than the UK. Just a higher initial outlay.

We got more for our 12 year old BMW 325i than we paid for it (owned for two years).

Edited April 28, 2007 by Crossy

[LoveDaBlues]

IMO, used cars are expensive here because it costs so little to keep them running. In the states once a car starts needing 'repairs' all the time it's just too expensive to keep it going so you buy a new one.

example: the father-in-laws OLD Toyota truck (700,000 km) needed major engine work. The bottom and top end were taken apart. The crank was taken to a machine shop and had some work done on it. There was a total of 7 new parts bought. The motor was re-assembled. The entire bill came to $200 USD.

[JimmyTheMook]

I just dont get the price of 2nd hand cars here.

They are so expensive when i compare them to the UK.

I looked around in Phuket. Here's a couple of examples.

1. A 12 year old Mitsubishi Lancer. About 200k Kilometres. Ok condition for year. 150k baht.

2. A very basic 12 year old Totoya Soluna. About 300k Kilometres. Base model. 225k baht.

That's just silly money. And they were about the cheapest cars on the lot.

The downpayment on these cars was 30k baht. I'm pretty sure that in the UK, the total cost of these cars would be 30k baht!

What gives?

Is this just a Phuket thing? Are they a lot cheaper elsewhere?

As an American I find cars here way overpriced.

That being said , your comment on the value of 2nd hand cars is spot on.

I see many old beaters that would be at best 800 to 1000 dollars going for 3 times that much.

On my 2nd car here in Thailand , first was bought 2nd hand - ended up buying current car from the dealer.

[thai4u]

Subaru,why is this car SO EXPENSIVE!!!???

I want a second hand one but it is unresonable price here in thailand.

[stingray]

The Prices are much higher than in Eurpoe or US. Especially if you buy a japanese car. They are very expensive. For example: a 93 Honda Prelude cost about 400k today. But for 400k they sold the same car 7 years ago. Simular with Honda Civic, Toyota Corolla, etc. They are two reasons. Thailand have very high import tax, and labour is very cheap to fix the car. Body, enginework, uppolstery, etc. can be done for low costs, so the car get value again. But think about insure and road taxes! That's very cheap in compare with Westerncountrys. Labour, insurance and tax are very cheap, cars are more expensive, if you calculate all together it's still cheaper to run a car in Thailand than in Europe or USA.

[warwick7735]

Hi all

I think basically its down to the fact there is no real set price for a vehicle, in the UK we have the Glass's guide which is like a bible so all the car dealers know how much a car is worth and then sell it at that price. All dealers will be around that particular figure.

Here I'm sure they just think of a number and double it, I see dealers within a few hundred metres selling the same make of vehicle, same year and the price difference is around 100k.

If people stopped paying over the odds for secondhand cars the prices would eventually drop.

Warwick

[ajahnlau]

Hi all

I think basically its down to the fact there is no real set price for a vehicle, in the UK we have the Glass's guide which is like a bible so all the car dealers know how much a car is worth and then sell it at that price. All dealers will be around that particular figure.

Here I'm sure they just think of a number and double it, I see dealers within a few hundred metres selling the same make of vehicle, same year and the price difference is around 100k.

If people stopped paying over the odds for secondhand cars the prices would eventually drop.

Warwick

You don't have to pay double like the rest of the people,Walk. Forget about the price of tea in the UK or anywhere else your in Thailand.

[Crash999]

I just dont get the price of 2nd hand cars here.

They are so expensive when i compare them to the UK.

2nd hand cars are expensive because new ones are expensive. For a good idea of market costs, pick up one of the weekly Thai car listings magazines such as 'Rot'. Not sure if the mags are available in Phuket but in Bangkok you can find them in all the major magazine sellers.

My recommendation would be to go for a used Corolla or somesuch- plenty around, reliable, and cheap to service.

[chanchao]

I think basically its down to the fact there is no real set price for a vehicle, in the UK we have the Glass's guide which is like a bible so all the car dealers know how much a car is worth and then sell it at that price. All dealers will be around that particular figure.

Here I'm sure they just think of a number and double it, I see dealers within a few hundred metres selling the same make of vehicle, same year and the price difference is around 100k.If people stopped paying over the odds for secondhand cars the prices would eventually drop.

You haven't been paying attention to the other posters: Second hand cars *ACTUALLY* represent more VALUE in Thailand than the very same vehicle would in the UK.

Take that 12 year old Mitsubishi.... you know it WILL need maintenance, the odd bit replaced, work being done.. Run into that in the UK and you're DEAD, it's write-off, you're done, THE END, finit. The car is instantly reduced in value to 0 pounds. <Woosh> same car in Thailand: Take it to the shop, person works on it for a day or two, the bill comes to somewhere well under 100 UK pounds and it's running fine for another x0,000 kms.

Same car, higher value, higher ticket price on the windscreen. And keep in mind you get that higher price back when selling the vehicle again, so just get over yourself, cars are NOT expensive in Thailand! The issue exists only between your ears.

Edited April 29, 2007 by chanchao

[chanchao]

2nd hand cars are expensive because new ones are expensive.

Not really. Well, relatively speaking 'a car' is an expensive item compared to anything else you might purchase or rent in Thailand, I'll grant you that much. BUt looking at the same vehicle, for vehicles produced/assembled in Thailand or under ASEAN free trade rules, the car is NOT more expensive than in Europe.

It does seem the base entry model in European markets is lower spec than in Thailand... In Thailand even the base model will have airconditioning, electric windows, good paint job, mag wheels and AT LEAST a 1.6 engine, if not 1.8. In Europe it all starts out a bit lower, but if you compare the same model & kit then prices are pretty similar. And some cars are a steal in Thailand.. . go check what you pay for a nice 4WD 4 door pickup in Europe, not to mention (something like) a Fortuner..

[solo siam]

2nd hand prices in Phuket are probably the highest in Thailand (which are high already), I once saw a 98 Honda CRV for sale here that would cost more than a brand new one on their credit terms.

[Phil Conners]

1) New cars are relatively expensive in Thaland, compared to most of the rest of the world, due to huge taxes. This in itself of course means that second hand cars are equally expensive.

2) As LoveDaBlues already pointed out, garage work is (usually, unless you are being taken for a ride) dirt cheap, so there are less incentive to buy a new car.

[DrFisher]

I was told in Thailand you pay the high tax on the car not at the gas the pump. I tend to believe that only because gas is cheaper here than it was in the USA when I left. I was also told that the tax is so high on cars to keep people from being able to afford them very simply if you were to replace every motorbike with a car there be gridlock 24/7

[markg]

Actually, i think new cars in Thailand are expensive too.

People say that the average monthly wage in Thailand is 8,000baht a month - but lets pretend its 15,000 baht a month. Then that is 180,000 baht a year. And that means you could buy a 10 year old Toyota car.

In the west, a brand new car is generally significantly less than your annual salary. (The new Mondeo Ghia comes in at 18,000 UK pounds - which is much less than the average annual salary - and you know in 2 years time, when it's barely run in, you are going to pick it up for 30% less too.)

The huge tax thing - i'm not sure about that cos, the "japanese" cars are built here in Thailand and dont attract import tax. If you import a car from the UK then it will attract over 100% import tax.

But i just dont understand why they dont depreciate. A 10 year old car here ony seems to lose 50% of its value. That makes it expensive. By any yard stick, a 10 year old car shouldnt cost 1 years average salary.

The poster who said that the prices are kept high to keep people off the road might well be right.

30 years ago in the UK a bog-standard car cost the equivelent of 1 years salary. Not all families had a car and really no one had two cars. Now a very decent car can cost half a years salary. Many many families now have 2 cars. That has led to increased gridlock!

[Crash999]

2nd hand cars are expensive because new ones are expensive.

Not really. Well, relatively speaking 'a car' is an expensive item compared to anything else you might purchase or rent in Thailand, I'll grant you that much. BUt looking at the same vehicle, for vehicles produced/assembled in Thailand or under ASEAN free trade rules, the car is NOT more expensive than in Europe.

I suppose I should have said they're more expensive relative to other markets as for sure there are some, like Singapore as an extreme example, where cars are more expensive than Thailand.

I'm not familiar with all of the European markets, but from what I've seen of the UK it is as a whole definitely less expensive than in Thailand- ranging from a bit for lower-end cars to a huge amount for more expensive stuff. For example to get into a BMW 3-series in the UK one would have to pay just over 20k pounds or about 1.3m baht, Thailand (where they're assembled) is 50% more expensive for almost the same animal. And that's not considering any of the bigger engines which are far far more expensive in Thailand. A base Accord is slightly more expensive at 1.25m vs 1.15m.

And of course the US is far less expensive.

Anyway, as a whole I don't see the depreciation curves being unusual in Thailand except for some older cars that tend to retain value for a long time. Then there are unusual cars which due to demand stay at a relatively stable value. I sold my Supra for actually more than I bought it for and today the same car has appreciated another 200k Baht.

Edited April 29, 2007 by Crash999

[Crash999]

I was told in Thailand you pay the high tax on the car not at the gas the pump. I tend to believe that only because gas is cheaper here than it was in the USA when I left. I was also told that the tax is so high on cars to keep people from being able to afford them very simply if you were to replace every motorbike with a car there be gridlock 24/7

Taxes were greatly increased in the late 90s on 'luxury' items in the wake of the Asian economic crisis. It was seen as a way to provide a revenue stream by taxing those spending money on frivolous items while many people were suffering. The taxes were supposed to be temporary but of course are still in place. A big issue if the taxes were lifted, aside from lost revenue to the government, would be destroying the resale value on used cars that incurred the tax to begin with.

Like with most governments in the world, once a tax is in place it doesn't seem that the Thai government is too keen to repeal it....

[mads]

This post makes me laugh.

You should try to buy a car in Denmark, now thats expensive.

[bikerlou47]

I was told in Thailand you pay the high tax on the car not at the gas the pump. I tend to believe that only because gas is cheaper here than it was in the USA when I left. I was also told that the tax is so high on cars to keep people from being able to afford them very simply if you were to replace every motorbike with a car there be gridlock 24/7

Gas is actually a bit more expensive here than in the U.S after you do all the conversions it comes to more than 3 bucks a gallon.

[Clipped]

imo cars here are more expensive because the thai people have to work harder to pay for them...therefore making them more valuable.

[warwick7735]

Hi

I can only go on what I know here and back in the UK, but new run of the mill cars are cheaper to buy here than in the UK (without taking into account the difference in earnings). Honda Jazz here 705k฿, in the uk 883k฿, Ford Focus ghia here 939k฿, in the uk 1,061k฿.

But as soon as they become used cars the price in the UK drop considerably, usually 30% in the first 12 months, where as here they still demand a high price. Why buy a second hand car which is 2 years old when your only saving say 50-100k on a new one.

I think it might have something to do with not being able to tell how old the car is from the number plate, you dont know whether a particular car is 2yrs or 5yrs old.

Where as back home everyone wants to impress the neighbours with having there new car with the new number plate, hence there are more sales leading upto the 1st Mar & 1st Sept when the new plates come out.

Thats my opinion

[Clipped]

hello warwick,

license plates can be related to the year the car was produced, any used car dealer will examine the plate first...unfortunately i do not know how the system works.

one downside of the registration sysem in thailand is that mileage is not an integral part of the records as in the US.

[samran]

Hi all

I think basically its down to the fact there is no real set price for a vehicle, in the UK we have the Glass's guide which is like a bible so all the car dealers know how much a car is worth and then sell it at that price. All dealers will be around that particular figure.

Here I'm sure they just think of a number and double it, I see dealers within a few hundred metres selling the same make of vehicle, same year and the price difference is around 100k.

If people stopped paying over the odds for secondhand cars the prices would eventually drop.

Warwick

A little bit of research goes a long way. Every news agency has car magazines with listings of second hand cars. You don't even really have to be able to read Thai to figure out what the range of prices are. Websites such as taladrot.com have extensive lists and pricings, year by year of particular vehicles.

We bought a 10 y.o 4wd run about a while back, and spotted that the model we were buying was the last in the line of a more 'solid' construction. Hence, it was more expensive that the 9y.o model due to construction and reliablity issues, and the pricing that we looked at from the internet and the trade magazines was pretty spot on as far as we were concerned.

[Maigo6]

As for pick ups, no one in their right mind would buy a pick up as their vehicle of choice unless it was a work vehicle or they lived somewhere remote.

You have a Toyota Vigo pick-up I believe, do you use it for work, or do you live in a remote area?

I had a pick-up in Thailand and thought it was great.........city, town or country, I sold it to the Toyota dealer in Khon Kaen when I bought my Fortuner.....270,000 Baht for a Toyota Tiger 4WD 2 door, year 1999......it went to a dealer for 350,000 and he sold it to a punter for 400,000!!!! That was more than I paid for it 2 years previous!!!

Emporer Tud tends to slag off Toyota Fortuners in Thailand, and if compared with X5 BMW's one can find them lacking somewhat, but in Thailand, BMW's are so expensive, Toyota Fortuner is a good deal.

Example:

Model: BMW X5 4.4i 2002.

Price: 3,680,000.00 Baht.

Mileage: 59,600 Km.

I used to have a 7 Series BMW in UK, great car...( Unless it went wrong )....28 Pounds 50 pence per Hour plus VAT just for the labour in BMW Tunbridge Wells, and that was in 1989!!!!! then you had to pay for the parts.........

Happy Fortuner owner.

Edited April 29, 2007 by Maigo6

[think_too_mut]

Fundamental lack of understanding by all posters.

A car in Thailand is, for 80% of the population, the same kind of investment as bying a house. Where in the West can you get a house for 10-15K US$?

Some posters mentioned cars that would cost 1000-2000US$. In Japan that money is needed to get someone to shred them off safely.

[Maigo6]

It provides a harsh ride, lacks true speed, especially at low revs (mine has an extra 35bhp over standard and it is still lacklustre), noisy, difficult to park and manuever.

ET, where did you buy the 35bhp chip from, and do they really make a difference, I was thinking about chipping my Fortuner.

Did you think it worth the money, how much was it ?

Are these chips easy to come by ?

[Badbanker]

You can always go to www.union-auction.com and on Saturday buy from one of the 2-300 cars for sale at auction. It is a good deal and you will get substantially lower prices. Fixing them up is a snap and cheap!

Badbanker

[corkscrew]

Just the way it is.

You'll find that the cost of ownership of your 'expensive' used car in terms of what you get for it when you sell is much lower than the UK. Just a higher initial outlay.

We got more for our 12 year old BMW 325i than we paid for it (owned for two years).

Crossy, I think that with taxed cars the original owners are just trying to recapture some of the tax that they paid when they bought the car new.

[nikster]

1) New cars are relatively expensive in Thaland, compared to most of the rest of the world, due to huge taxes. This in itself of course means that second hand cars are equally expensive.

2) As LoveDaBlues already pointed out, garage work is (usually, unless you are being taken for a ride) dirt cheap, so there are less incentive to buy a new car.

This has been discussed here before...but 1 and 2 are spot on.

2) ... means you can keep an old beater running forever, cheaply.

3) There is not a large base of existing used cars. Thai middle class has only "recently" been able to afford cars. Simple laws of supply and demand.