Advice from Intellichoice: Cost of Ownership: It’s Not Just Data to Us

Many years ago, someone was looking for a way to determine what a new car would cost him over the next few years.  He was disappointed to find that information simply did not exist.  While plenty of resources would give him the vehicle price to buy, he found no data on what it would cost to own. IntelliChoice was founded with consumers in mind.  We don’t just produce ownership costs as another data point to put on our website; rather, it’s the heart and soul of what we do, and the reason the company was founded.

For a quarter of a century, IntelliChoice has been the industry leader in vehicle ownership costs. It is our core business; it is the place where we direct our time and resources, understanding not only the importance of this element of a consumer's relationship with their vehicle, but also the importance of accurate and sensible projections. IntelliChoice does not outsource the analysis of ownership costs. We have developed our own tools and methodology for depreciation research, as an example. Our retained value calculations are our own. The many years we have concentrated on this area, the exhaustive historical data that make up the core of our research, the proprietary analyses we have accomplished, all combine to give us a unique, deeper understanding of value trends. This also allows us to address with authority questions regarding not just our own forecasts but also the general concept of vehicle depreciation. Another ownership cost area where IntelliChoice excels is fuel. IntelliChoice is the only company that uses a six-month rolling average for fuel costs and that determines realistic fuel price inflation. This is critical because simply using a snapshot in time for fuel costs can skew a projection up or down. For instance, while others might use an inflation adjustment of one or two percent, our historical research indicates the average increase is much higher. We project the price of fuel five years into the future rather than be content with a short-term view. Repairs is another area where IntelliChoice leads the industry. Our competitors simply look at third-party extended warranty pricing when calculating repair costs. We are the only provider of ownership costs that factors in the differences in manufacturer warranties when analyzing repairs. Because we have been doing this research for 25 years, we have a uniquely rich historical perspective on repair cost trends and warranty pricing. For example, third-party extended warranty pricing does not change significantly even when a manufacturer makes a major change in its new-car warranty. A major advantage that IntelliChoice enjoys in the area of maintenance costs is that we stay in direct contact with manufacturers. Other companies may simply use third-party data, but those sources are always one to two years behind in releasing that information. One of many benefits of our methodology is that by going directly to the manufacturers we receive part pricing, labor times and intervals on newly released models and completely redesigned models. Even in ownership cost areas where IntelliChoice has no clear advantage, our 25 years of experience allow us to calculate costs with confidence, to spot industry trends that others might miss, and to check our own results over time. Remarkably, the IntelliChoice research staff combined, represents almost 90 years of experience, with the “newest” employee having been here for over 13 years. With backgrounds in math, statistics, and automotive data analysis, we employ an unmatched team boasting a strong skill set.