How this calculation works
This calculator compares the full economic cost of fixing your existing car against replacing it over an equal ownership period. It accounts for upfront repair quotes, purchase financing, trade-in value, sales tax credits, operating costs, and residual vehicle equity.
Key formulas
- Keep net cost: Upfront repair quote plus ongoing annual operating costs (maintenance, repairs, insurance, fuel) over the comparison horizon, minus the residual resale value of the car at the end of the period.
- Replace net cost: Total vehicle acquisition outlays (loan payments or upfront cash after trade-in equity and sales tax) plus replacement annual operating costs, minus ending vehicle equity (residual market value minus any remaining loan balance).
- Trade-in tax credit: Under state tax rules such as New York Tax Law Sections 1105 and 1111, trade-in allowances reduce the taxable purchase price of the replacement car.
- Break-even repair ceiling: The exact repair quote at which the total net cost of keeping the car equals the total net cost of replacing it. If your mechanic quote is below this ceiling, repairing saves money.
- Ending vehicle equity: Residual vehicle market value at the horizon end minus any remaining loan principal balance.
Sources and benchmark dates
Operating and maintenance cost estimates reflect AAA Your Driving Costs data and the Bureau of Labor Statistics Consumer Price Index for motor vehicle maintenance and repair. Financing rates reflect Federal Reserve G.19 consumer credit releases for 48-month to 60-month commercial bank vehicle loans. Vehicle depreciation benchmarks are based on Kelley Blue Book and Edmunds industry depreciation curves. Checked on 2026-10-12.
A planning estimate based on your inputs and the assumptions shown. Actual repair costs, vehicle condition, and trade-in valuations may differ.
This calculator does not inspect vehicle safety or predict unexpected mechanical breakdowns. Consult a certified technician to evaluate mechanical reliability and roadworthiness.