• How to Use a Car Cost Calculator and Estimate Your Auto Costs

    A car cost calculator allows you to approximate a dealership’s cost for a new or used vehicle. Having the auto pricing information offered by such a calculator can put the ball in your court when you are shopping for a new or used vehicle.

    If you’re going to buy a new auto, costs are going to have a large impact on what you decide to buy. Car cost estimates are a great way of researching exactly how much a given car is going to cost over you the period of ownership. There are a number of other smaller costs that add up to make what is known as the total cost of ownership of a car.

    Determine Your Options

    Before you can use a car cost calculator, you must first know what options you are hoping for on a vehicle. You can use a manufacturer’s website or the invoice price calculator itself to learn about the options available on cars and trucks. Once you determine the options you require, proceed to pricing a vehicle to your specifications.

    Calculate the Invoice Amount

    An invoice pricing calculator will provide you with information on manufacturer’s suggested retail prices and invoice pricing on vehicle options. As you add options to your vehicle, both prices will increase. Once you build the vehicle to your specifications, print the pricing information and submit it to dealerships to request price quotes.

    Approximate the Holdback Amount

    Although a dealership’s approximate cost is equivalent to the invoice amount, the holdback amount paid from the manufacturer to the dealership impacts auto pricing. You can normally approximate holdback to equal between 3-5 percent of the car invoice price. Keep this amount in mind when negotiating with a dealership, as holdback allows the dealership to sell a vehicle at invoice and remain profitable on the sale.

    This is what the dealer pays to buy the car from the factory, plus any fees that aren’t listed separately. Many times you can have the dealership remove any fees dealing with delivery of the vehicle since the factory will normally reimburse them for those charges. Types of fees that may be added to dealer actual cost to come up with the invoice price are as follows:

    • Transportation or delivery fee
    • Fees to pay for cleaning and detailing
    • Addition of floor mats
    • Installation of hubcaps
    • The last 3 are usually grouped together under the catch-all “Dealer Prep Fees”.

    Dealer Installed Options

    Any options packages installed by the factory will be accounted for in the price the dealer pays as part of the invoice price. Anything that the dealer adds on after delivery is known as dealer installed options. A partial list of possible dealer installed options follows:

    • Extra white or bright headlamps or fog lamps
    • Premium audio systems
    • Keyless entry/remote start/security systems
    • Sirius satellite radio
    • GPS/Navigation systems
    • High output or capacity electrical systems
    • Dealer Documentation Fees

    Fees such as registration, taxes and inspections, among other things required with every sale are usually lumped together under documentation fees. These fees are non-negotiable since they are set by the state you live in.

    Routine Maintenance

    Routine maintenance covers everything that must be done to the car to keep it in optimal running condition. Some of the maintenance items are as follows:

    Intervals for this depend on driving conditions and the type of oil you use. Full synthetic oils will give longer life and change intervals.

    Tune-ups for most cars is once a year and entails changing spark plugs, air and fuel filters and checking the ignition timing is equipped.

    Over a typical three-year vehicle lifespan, belts and hoses might require changing once.Tire Rotation is recommended every 5,000 miles. Suspension alignment should also be done every 15,000 to 20,000 miles. Finally, factor in tires and fuel costs.