Success Story: Julie Chavez
The first time Julie Chavez filled up her 2007 Acura MDX -- with the recommended premium gas -- she was more than a little surprised to find out what it cost to fill its 21-gallon tank.
"I actually looked under my car to see if the gas was leaking out, because how could it possibly cost that much to fill up my vehicle?" recalls the 32-year-old senior project accountant for a defense contractor who lives in Laurel, Md.
And that was in November 2006, when gas was just above $2 a gallon.
Gas mileage hadn't been a consideration when Julie bought the full-size, luxury sport-utility vehicle.
"I loved everything about it: the way it looked, the way it drove, all the features it included," Julie says.
She also liked driving a larger vehicle. Julie felt safer in the 7-passenger SUV, plus she could easily tote friends around -- a frequent occurrence since she was eager to show off her new ride.
She quickly paid off the $45,000 model she special-ordered, even springing for the extended warranty because she expected to keep the truck for a long time.
Unfortunately, that first painful trip to the gas station wasn't her last.
As gas prices went up, her MDX became increasingly expensive to refuel. Julie was miffed when banks imposed a limit on how much she could charge at the pump, cutting her off before the MDX was full.
She began thinking about getting a more fuel-efficient car in summer 2007, less than a year after buying her MDX. But despite its faults, she was still in love and just couldn't let go.
"I knew I would hate myself for giving it up, so I kept it," Julie says.
But by spring 2008, her monthly gas bills had gone from $200 to $400. And that was despite the fact that she was working from home at least three days a week and would borrow a friend's hybrid on days when she had to drive a lot.
"Now I was beginning to dislike my car," Julie recalls.
In May, Julie decided enough was enough. She took the less than 2-year-old MDX to CarMax, which offered her just $27,000. Shocked, she tried to sell it on her own for $31,000 -- as much as $8,000 less than other MDXs also advertised for sale -- but had only one inquiry.
Because Julie wanted to buy a Honda Civic Hybrid, she decided to try her luck trading in her MDX at a Honda dealership.
"They only offered me $22,000," she says. "That would mean that my lovely MDX, that was paid off, wouldn't even pay for this little compact car."
Julie used the quote from CarMax to negotiate a higher trade in. After taxes, tags and dealer-installed options, as well as another extended warranty, she owed $255.
She convinced the dealership to cover the cost.
As she sat in the dealership filling out the paperwork on her Civic Hybrid, Julie watched as people looked at trucks, minivans and SUVs. "If they only knew," she thought.
"I think part of the test drive should be taking the vehicle to the gas station to fill it up," she says. "That will really tell you what you're getting yourself into, not just that big car payment and insurance, but how the heck are you going to pay for that gas?"
Julie wondered how she would feel leaving her MDX behind at the dealership. To her surprise, she felt relieved knowing that her days of dreading fill-ups were over.
She paid a price for trading it in when big trucks are depreciating two to three times faster than usual.
But Julie's confident her Civic Hybrid will eventually pay for itself, especially if gas prices continue to rise. In the first month of ownership, she spent only about $120 on gas.
"I am sad that my beautiful, dream MDX is gone, but I know it's what I had to do to survive this gas insanity," she adds.
Julie offers the following tips for frustrated SUV owners:
- Look at the big picture. The days of just using monthly payments and insurance costs to see if you can afford a vehicle are over. You've got to take into account all things gas-related, including the mileage and tank size.
- Don't buy more vehicle than you need. "I think many people buy a vehicle for status purposes, or because they look good in a vehicle, but honestly, there are more important things to spend that kind of money on," Julie says.
- Expect to ake a loss. Get more than one trade-in offer so you have something to bargain with.
- Don't invest a lot of time and money trying to sell your SUV. "People just do not want to buy larger vehicles right now," Julie says.