The $15,000 Question: BMW E39 5 Series

The  1996 to 2003 E39 might be the best 5 Series BMW will ever make.  A good looking, reasonably modern car, it's a better driving Bimmer than the two generations that replaced it.  It's not that the newer cars are bad, just that priorities have changed.  People want cars with sat-nav, Bluetooth integration, and in-car infotainment.  Driving has become secondary to whether or not you can stream Pandora from your smartphone or get directions for dinner.

For $15,000 you can buy anything from a BMW 525i to an M5.  Any choice should be a good one, but the M5 has the potential for appreciating in value, like the older M5s and M3s are currently doing.  The 540i is also a good alternative to the M5, with it's V8 engine from the 7 and 8 Series but without the Red Bull laced edginess of the M.  Either way you go, you'll get a focused driver car, with the practicality of a Honda Accord. 

 

The only drawbacks to these cars are age related.  Even the newest one is ten years old, and like all older cars, what you get is largely based on how the car was taken care of.  When something breaks, parts are usually readily available but the repair bill will be expensive.

Thee biggest challenge of owning a BMW, any BMW, is the yuppie factor.  There was a time that a BMW was the required vehicle for young urban professionals.  It was a status symbol, like a Rolex watch or Hugo Boss suit.  That perception exists today, can dampen the inherent baked-in goodness of the car, but if you can tolerate that perception, or welcome it, the E39 makes a good all around car for an enthusiast on a budget.               

Beater Challenge Update - $2800 Saved

To date, I've saved $2800 driving the Cutlass. Other than oil changes, gas and the occasional car wash, I've done NOTHING to the car. It continues to provide reliable, if humble, transportation and averages 22-24 MPG.

Car nut that I am, there are tons of other cars I'd rather own. Now that spring is here and the weather makes it difficult to be indoors, I wish I owned a convertible--something with four seats like a BMW, Ford Mustang, or Saab would be nice.

The Law of Depreciation

The law of deprecation is a car enthusiast's best friend. Cars that were $50, $60, even $100 grand ten years ago can be had for pennies on the dollar today.

I was reminded of this fact recently while browsing car ads online and realized there are a number of 1997-2000 Porsche Boxsters for sale below $10,000. Ironically, one of my favorite affordable Porsches, the 944, is appreciating towards that amount. So today you can have your pick--Boxster or 944 for the same money.

I know I'd take the Boxster. As much as I love the 944 for its mix of performance, handling, practicality and reliability, the Boxster includes all those traits and has Porsche's iconic flat-6 engine mounted mid-ship.

But it's not just Porsches that experience the phenomenon of depreciation. Just about any car hits its low value when it reaches 10-15 years old. In the 1970s, you could pick up a V12 Ferrari or Jaguar E-Type for the cost of a new Ford Pinto. In the 1980s and early 1990s, muscle cars and 1960s Corvettes were cheap. Now all of these cars are approaching the price of a three bedroom house, or far more in some cases.

Today you can find all kinds of bargains as well. The Porsche 928 and BMW 8 series are in the same price range as the Boxster, as are the Jaguar XJ and XK8. Or if you like American iron, you can pick up a C4 or C5 Corvette, Mustang Cobra, or Camaro Z28 for the same money.

The downside is as the Romans said, "caveat emptor"--buyer beware. All of these cars are at least ten years old and have close to 100,000 miles on them. They may have been lovingly cared for like someone's pet or abused like a Taliban donkey. And you won't know which without taking it to a good mechanic and spending several hundred dollars on a thorough inspection.

We also don't know if these cars will ever appreciate in value, becoming valuable collectors items. Certainly they have the potential, but for now, they should just be cared for and enjoyed.

Who Killed the Diesel Car?

In 2006, an independent film called “Who Killed the Electric Car?” explored the demise of the electric car industry in the United States. Just over three years later, it appears the electric car has more lives than a cat. Not only is there a thriving cottage industry for electric cars and electric car conversions, but several major car companies plan to roll out electric cars in the next three years as well.

On the other hand, diesel powered cars are being killed. Nissan, Toyota, GM, Ford, and Chrysler have all scaled back their plans to produce diesel versions of several popular cars and trucks, or canceled them outright. Only ze Germans—BMW, Mercedes and Volkswagen plan to expand their diesel lineups in the coming months. Germany, if you recall, perfected diesel technology almost a hundred years ago and had diesel-electric hybrids as early as 1915. They were called u-boats.

Diesel is popular in Europe, and I don’t know why it hasn’t caught on in a truck crazy country like the US. The latest batch of diesels offer good performance and get 30-50% better mileage than their gasoline powered counterparts. Diesel versions of the Ford Fiesta and VW Polo routinely get 60-70 mpg in Europe, which is the kind of mileage makes hyper-milers giddy and turns already green Prius owners black with envy.

There is an urban legend about a man who tried to commit suicide by running his new diesel while sitting in the garage. According to the myth, he woke up after a couple of hours feeling refreshed because the tailpipe emissions from his car were actually cleaner than the outside air. I doubt this story is true, but the latest diesels do even meet California’s tough emissions standards.

In “Who Killed the Electric Car,” the demise of GM’s EV1 electric car program was partly blamed on the ignorance of consumers who were largely unaware such a vehicle existed. I suspect the same is also becoming true of the diesel.

The Best Cars for Snow

My friend Jody, who writes a blog called the AgrOpinion, likes to challenge me with car questions. Recently she asked me what I thought was the best snow car.

In most cases, it would have to be something with all wheel drive or AWD. All wheel drive is different than traditional four wheel drive because all four wheels are always connected to the drivetrain by a fluid-filled center differential. Traditional four wheel drive is a part-time system with a mechanical differential. In two wheel drive mode, only two wheels, typically the rear ones, are connected to the drivetrain. When you encounter slippery conditions, like snow, mud or sand, you can shift into four wheel drive and all four wheels will receive power. The traditional four wheel drive vehicle has more capability for traveling off road, or through deep snow, and are useful for people who live in places called Beaver Camp . But for people who live in suburbia, whose offroad excursions are limited to a snowdrift at the local shopping mall, AWD is the better choice.

Why? The reason is simple--four wheel drive can only be used in slippery conditions. AWD can be driven in any condition and is especially useful for roads that alternate from dry, to wet, to snow packed and back to dry. These conditions describe most of the road conditions in the Midwest this week, even with the record snow and cold temperatures.

There are a number of AWD vehicles on the market. Some are SUVs like the Honda CRV or Ford Flex. Some are normal looking cars made by everyone from Ford and Toyota to premium cars like Audi or Mercedes Benz. There are even high performance sports cars like the Porsche 911 and Lamborghini Gallardo which offer AWD. But my favorite AWD cars are made by a pair of quirky, offbeat car makers called Subaru and Suzuki. It used to be Subarus were only driven by Vermont college professors and Maine housewives who shopped at LL Bean, but anyone who has spent time in a Honda will feel at home in a new Legacy or Outback. Mention Suzuki, and people think "motorcycle" or "that jeep-thingy that flips over" but they make a great small wagon called the SX4, which you can buy new for under $18K.

My personal choice would be the Subaru Legacy GT, with either the 2.5 liter turbocharged engine or the 3.0 V6. It offers AWD with enough performance and creature comfort to make a BMW jealous, and looks that won't make you cringe.

What the Head Wants

My 1997 Infiniti has started showing its age. A few months ago the starter went out. This month, I'm dealing with a heater/blower fan problem, a vibrating/rubbing sound from the right rear wheel at highway speed, and problems with my stereo. For sometime I've also noticed oil spots on the driveway, where I park.

None of these problems are fatal. They are the flaws of a twelve year old car with 130K miles on the clock. Cars age in dog years. My Infiniti is a black lab with a graying muzzle and arthritis.

Like the lab, my car has lots of life left. It still likes to run. The 3.0 Nissan V6 is smooth and loves to rev. It uses regular gas and routinely gets 22-24 mpg. The transmission still snaps off
crisp shifts. The ride is not floaty or jarring--pot holes don't feel like hammer blows and yet it will corner nicely. It has room for five, even with two car seats, and a generous trunk. It also has features I like, including a sunroof, Bose stereo and leather seats. In short, it fulfills all my needs and most of my wants.

But it is 12 years old and has 130K miles...

I'm often guilty of shopping for cars online. I have a running internal debate over what kind of car I'd like to own next. Should it be something practical and reliable like a Nissan Altima, Hyundai Sonata or Ford Fusion? Or, for the same money, should I buy a used BMW M3 or Mercedes Benz AMG? Another Infiniti or Nissan Maxima is usually in my top five. So is a Mini Cooper, Mustang or Dodge Challenger.

I think the dilemma with older cars is when to stop maintaining them. The tipping point usually comes when the repair bills are more painful than car payments. For me that point is still outside my event horizon. As much as I like to dream, I usually wind up making the most practical choice, or at least a compromise. The head usually gets what it wants over the heart and in my case, I'm not ready to part with my car.

But I did see a nice Mercury Milan with 33K miles for $12K at a local dealer recently. And there is a Black 2001 Mercedes Benz E55 AMG in Texas on eBay for the same money...

Buick Regal, Sports Sedan

I'm having a hard time saying Buick Regal and sports sedan in the same sentence with a straight face. It's an oxymoron, but that's what GM is positioning the Regal as for its relaunch next year.

To be fair the new Regal will be based on the Opel Insignia, which has won accolades in Europe. Buick is also undertaking a huge effort to remake itself, much like Cadillac did ten years ago. And the new LaCrosse makes me think they're on to something.

Still, to position the car to compete with Acura, BMW and Infiniti, and use a stodgy nameplate like the Regal, is like Country musician Taylor Swift changing her name to Blanche or Patsy. Yes, there's a history there, but the connotation is not attractive. Buick has better names for a sports sedan like the Wildcat or Gran Sport. The Regal hasn't been cool since the Grand National came out 25 years ago, and people who own those cars don't call them Regals.

I hope Buick is successful. But to be successful, I think they need an attitude car, or halo car as it's known in the industry. Something like the Grand National that will draw Acura customers into the showroom and leave with a new Regal or LaCrosse.