Running the numbers on the bigger car: what’s your cost and is it worth it?


I got to ride in a new car, complete with satellite radio and new car smell, yesterday. Prompted by high gas prices, my friend traded in her SUV for a mid-size sedan. Equipped with capabilities to haul camping gear, bicycles, and perhaps kayaks, the vehicle was nonetheless deemed unsuitable for a jaunt to the mountains (hard to handle on those endlessly curving roads) or to the water park (the interior might get wet).

Until just recently, people (my friends included) most likely have thought I was either not so bright or way too broke for anything besides my straight-drive Toyota Corolla. I have continually found this befuddling as many of my friends lived through the gas crisis of the 70s (you may have studied it in history class but if you haven’t, please know that gas was rationed right here in the United States of America) and seem at least vaguely aware of global warming. I’d like to claim a purely environment platform but here’s my rationale: I hate to spend money when I don’t have to.

Okay, let’s do the math:

Ford Explorer

  • Cost: $26,105
  • Monthly Payment: $525.58 (60-month, 7.7% loan, calculate it yourself using the PMT-Payment function in Excel or go to
  • Fuel cost per month: $195.75 (estimate per

Toyota Corolla

  • Cost: $15,350
  • Monthly Payment: $309.04
  • Fuel cost per month: $96.67

The monthly difference ($315.62) is called the utility cost and you need to decide whether the increased pleasure is worth the expense. But know that if you buy the Corolla, invest the difference in the stock market (and earn 10% annually), then at the end of five years, you will be $24,644.36 richer (I used the FV-Future Value function in Excel).

Hmm… you could even pay cash for your next car.

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Guest's picture

I'm currently negotiating with myself over downsizing my vehicle for the reasons you outline. I feel I made a stupid, emotion-driven choice 2 years ago and am about ready to partially fix it. I posted about it here.

Good post. More people should think about these things.

Guest's picture

You left out one big variable:

Ford Explorer:

Medical cost after colliding with Toyota Corolla at 40 mph head on: $1200

Toyota Corolla:
Medical cost after colliding with Ford Explorer at 40 mph head on: None (because you're dead).

Hmmm.. you're right... Toyota Corolla is cheaper but I guess you get what you pay for.....

Guest's picture

To the people writing in about how much *safer* the SUV or truck is compared to a smaller vehicle: It is safer in some metrics, but not in others, and if we followed the logic to its conclusion, we'd realize: While it's probably true that the Explorer will do better in a head-on crash with a Corolla, a dump truck or a semi would do even better. Yet no one is writing in and advocating driving one of those as a daily driver. Why not? Because, most people who give that objection don't really care about safety, they just say (and think) they do.
The most important thing anyone can do about car safety is 1) drive less and 2) maintain proper awareness and calmness while driving (aggression and competition are out when it comes to your safety) and 3) learn more about driving so you can avoid accidents in the first place. Change your mental attitude to a more realistic one, becoming more aware of your surroundings while driving, and *learning to drive better*.

Do you know where you fall on the scale of driving competence/incompetence?

Do you know what a braking threshold is, and how to hold it using a standard braking system? How about with ABS? Is the first thing you asks when you get in an unfamiliar vehicle , "Does this car have ABS?". (If so, you has discovered that most car owners don't even know something that simple about their cars. It follows that they have no idea how braking works or how to do it effectively in their vehicle. And this has further implications beyond simple braking, to other accident avoidance maneuvers).

Do you know how to maintain a proper leading and following distance while driving? How often have you practiced an emergency lane change, and do you even know intellectually (leave aside your the aspect of muscle memorya and practice) how to do it in the first place? Do you know how braking, turning, and accellerating affect the contact patches on all 4 tires? Doubtful.
How about the two or three ways that ABS braking affects braking strategy and accident avoidance strategy? Did you know that you can use your brake pedal if you have ABS in order to use ABS in order to regain control of the if it slides while turning? Well, you do now. But if you don't understand why, you've got some learning to do. There are books that you can begin to get an understanding of these topics from ("Drive to Survive" by Curt Rich is a reasonable first read, followed by, perhaps, "Bob Bondurant on Police Pursuit Driving", believe it or not).

But unless you're willing to put in the effort and learn, don't pretend to yourself or others that car safety is a priority for you, because your behavior shows that it isn't.

Guest's picture

Yah, I would take the corolla over the explorer in an accident any day.
Check it out:

corolla scores better pretty much everywhere.

Guest's picture

Okay, I've heard this argument about little cars before. I drive a Corolla, myself, while most everyone else in the volunteer fire department drives their big, manly trucks. Before I continue, take a look at the numbers (of stars, that is)

Both the Explorer and the Corolla score pretty well. I'm also an engineer as my day job, so what I'm about to say doesn't come out of nowhere. True, the energy of the crash has to go somewhere, and it will get absorbed mostly by crumpling metal and heat. True, the Corolla will almost definitely be totaled by a head-on. Nonetheless, experience and observation tell me that the Explorer won't fare much better in a major accident. I've been to plenty of accidents where big SUVs shatter into a million plastic and twisted, metal pieces while small cars sustain damage that's hardly visible. In the major accidents, both cars are usually toast. In a head-on at 40 MPH between the two vehicles, both parties would likely sustain serious injury. Don't ask me how I know...

Now... Understand that, if you invest the smaller sum in an economy car like mine, you've probably got one big accident before you're totaled, while an SUV might sustain less damage or just as much. You, as a person, however, are likely to be just as safe (or unsafe) in either vehicle. My wife is a bit more prone to accidents, and her '99 Jeep Cherokee has taken a few small hits without much damage, while I'm pretty sure the Corolla would need more body work. The Jeep is a lot thirstier, but the investment seems to have paid off. If your driving habits are less than perfect, a more robust vehicle might be a better investment, but safety has more to do with structural integrity than size. Alright, I'll stop lecturing now.

Guest's picture

Strange logic of escalating vehicle size for "safety" reasons. You'll all be driving Hummers soon. Then you'll have to get tanks. :-)

Sold my last (small) car in 1999. I've "saved" over $100,000, less the $15,000 or so I've spent on public transport. I prefer to spend my money on other things.

Julie Rains's picture

So, perhaps we've established then that the person with the biggest car doesn't necessarily "win."

Guest's picture

the primary function of the car should determine the size of the car. that is if you are driving solo to commute to work then a smaller car should be efficient for the job. but if you are a single parent with one child to pick up a few bags of groceries, then a small car is still the answer.

if you are going to the back woods on a camping trip with four adults then you can go to hertz and RENT a SUV. you split the cost four ways and everyone save.

Guest's picture
Rob O.

The excellent article by Malcolm Gladwell Big and bad neatly dispells the notion that SUVs are the safer choice. In a nutshell, it's a scam.

SUVs offer the perception of increased safety due to their bulking stature, but there's far too little engineering under that sheet metal to warrant the faith. What's more, the attitudes & driving habits of SUV-owners go even further to make the vehicles far less safe.

Automakers & advertisers need to take responsibility for the deceptive notions in play and begin working to quickly change consumer perceptions about cars - these things are transit. Our 3-bedroom home cost us less (10 years ago) than most Hummer, Chevy, and/or Ford SUVs. Bigger & faster is not better.

There's little or no reason for the average commuter to own a vehicle powered by a 6 or 8-cylinder engine yet take note of just how often you see hulking 9-cup-holder-having behemoths being used for nothing more than commuting to work or the grocery store - with a single occupant!

Guest's picture

corollas are bass ass

Guest's picture
Crazy Loc

Muhahahahahahahaha????????????????????????????????????????????? I know small car cost cheaper than big car. big car attend to take a lot of gas. Peace out cuzz???

Guest's picture
Crazy Loc

does a honda is cheap to?? just wondering?

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