I hear people say leasing is the way to go, but I don't understand the math. Cars easily last 10 years now, and I drove my last car for 18 years. Please explain! Is it about always having a newish car at an optimal price?
Personally I decided buying cars a few years old made far more sense.
I think it absolutely does. I actually go for older than that, Typically 6-8 years or even more. Right now my newest car is a 2006 which I bought last year.
Not everyone places value purely in the monetary realm. Some people view cars as a status symbol. There is also less hassle with leasing.
That said, I get it. Some people place a ridiculously high value on having the latest. I think I used to be in that population, to an extent. Nowadays, I confess this mentality leaves me ridiculously confused.
I can understand the appeal of new if you are buying to keep for a long term, or something exotic. Outside of those I don't know why anyone would buy new a thing that loses half its value in the first two or three years. Still it provides plenty of choice in the secondhand market. :)
The dealers will sell the car for next to nothing because they owe money on the car, and get stuck with inventory they don’t want. Your Toyota dealer doesn’t get his high margin 4Runner unless he takes a view Yarii (or whatever the tiny Toyota is). This is the same reason bars sell well liquor at a loss.
Even if a Rum & Coke is 5 dollars (I'm used to it being more around 8-10$ on average, but being conservative), the unit economics still seem extremely profitable to me. I would think the coke from the fountain costs pennies, and the shot of (well) rum would be max one dollar.
For comparison, with beer you're looking at about $2 per beer retail ($50/24 bottles) and likely to pay $8 or more at a pub. This suggests a similar markup on beer to spirits, at least here.
Note however that a proper martini (or manhattan, old fashioned, etc) is likely to get you the best bang for buck as a consumer - all the 'fancy' drinks marketed toward women like frozen margaritas etc usually contain less alcohol but retain the same price tag.
I know one guy who had his own vehicle. But right before breaking up with his girlfriend she took out a car lease with his name on it. After they broke up he not only never needed the second vehicle, but also couldn't get out of the payment, so he had to get a second job just to cover the payment on a car he didn't need or want.