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MY Transmission Failed
Is my vehicle worth fixing?

It's a question thousands of people
are confronted with everyday.
   
 
   
 

When your automatic transmission fails, finding good, reliable and unbiased information and advice is hard to come by.  We hope the following will help...

Whenever faced with a major repair like an engine or automaticMy Automatic Transmission transmission rebuild, you always have to ask yourself; "Is my vehicle worth it"?  Because, at some point, the answer will be a resounding "NO"!  The question is, how will you know when it's time to stop pouring money into your used vehicle? 

Unfortunately, because everyone's situation and circumstances are different, there is no absolute right or wrong "blanket" answer that would apply to everyone.  As such, you have a little work to do.

When is it smart to stop sinking money into a used vehicle?

Here is what you need to do:

STEP 1 - Vehicle Book Value

Find the estimated value of your vehicle.  You need to know the "as-is" (current condition) value and the "repaired" value.  To get these values you'll need to start by finding the "repaired" value first since this information is more easily obtained.  To get your vehicle's value in its repaired state, visit Kelley Blue Book "kbb.com" and click on the "What's my vehicle worth" link.  Enter your vehicle details and mileage.  Then select "fair", "good" or "excellent" to describe the vehicle's condition.  Lastly, when asked, select "Private Party Value".

The "private party value" is the amount your vehicle is worth when selling to an individual versus a dealer or dealer trade-in. 

For discussion purposes, let's say the Kelly Blue Book "private party" value for your vehicle is $4,500. 

My Automatic TransmissionSTEP 2 - Cost to Repair

Next, you need to know what it will cost to repair the vehicle.  If the vehicle's transmission has failed and the diagnoses is that the transmission must be rebuilt - you will need to obtain 3 transmission rebuild quotes from three different repair shops.

Note: If the transmission shop is reluctant to provide you a quote by telephone because they want to see your vehicle first, just tell them to give you a price quote for a standard rebuild.  If they are still reluctant to give you a flat quote, ask them to give you a best case and worst-case scenario quote.  Most shops will do this.

Once you have three quotes, add the quotes together then divide the total by 3 - this will give you the average cost.  For discussion purposes, let's say it is going to cost $1,800 to have your transmission rebuilt.

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STEP 3 - Determining the "as-is" Value

You've determined that the KBB value is $4,500 and have learned that the repair cost will be about $1,800.  Using these figures, your vehicle's "as-is" value would be about $1,800.  SeeMy Automatic Transmission image for explanation. 

Is it Worth Fixing?

In this example, assuming the vehicle is in otherwise good condition, from strictly a financial perspective, fixing your vehicle is a good decision.  But, not by much.  A difference of $1,000 in the either the book value or repair cost would be enough to lower the decision from good to questionable.  But, nonetheless, using these figures, the vehicle is worth fixing - even if your intentions are to sell it after being repaired.

Note: Selling a vehicle with a bad transmission may prove to be difficult at any price.  It's not impossible, but it may take a while to find the right buyer.

Arguments for Repairing and Keeping Your Vehicle

Generally speaking, repairing a car is almost always less costly than buying a new one.  Even a major repair like a blown engine or failed transmission can be repaired/replaced for considerably less than the cost of a new vehicle.

Purchasing a used car does not guarantee you will be free from spending money on repairs.  A used vehicle must be thoroughly checked out before taking a chance on buying one.

A new (or newer) vehicle will cost you more for insurance.  In many states, registration fees are also higher.

A new car can lose up to 25% of its value during the first year of ownership.  This is a huge chuck of money when you consider the average new car costs around $33,000.

Arguments for Purchasing a New (or Newer) Vehicle

Sometimes, the circumstances are such that it simply does not make good business sense to continue spending money on your current vehicle.  Here are some reasons you might consider in favor of purchasing a new vehicle versus repairing your current one.

Your car is nickel and diming you to the point where you're fed up.  As soon as you fix one problem another one pops up.  In this case, for the benefit of both your wallet and sanity, trading up to a newer, more dependable, car is probably the best choice.

Even though a newer vehicle may require you to make monthly payments, the actual monthly out-of-pocket difference between what you currently spend on repairs and the new car payment amount might not be so much.  New cars come with excellent warranties - so you can say goodbye to repair bills for at least 3-years after the purchase.

 Peace of mind - safety... when driving a new vehicle you are much less likely to breakdown on the highway.  Besides the expense, there are personal safety concerns that come with being stranded on the side of the roadway or in some dark parking lot.

 New vehicles are all-around safer than older vehicles.  Better handling, better braking, more airbags, back-up camera, improved lighting/headlights, etc.

Improved image, credibility and increased confidence...  driving a new vehicle provides numerous other "non-financial" benefits that are difficult to measure, but are certainly meaningful.

Other Factors to Consider

Mileage...

Regardless of past repairs, the overall condition of the vehicle and all the other factors described above, in most instances, once the odometer passes 200,000 miles spending money for a major repair is probably a bad idea.  The only vehicles that defy this general rule are listed here.  This short list of vehicles typically outlast all the other vehicles on the road - 250,000 miles and higher is quite common. 

  Honda Accord
Subaru Legacy
Honda Civic
Honda Odyssey
Nissan Maxima
Toyota Camry
Subaru Outback
Ford Taurus
Toyota Avalon
Acura TL

Your credit...

When considering whether to keep your vehicle or trade it in for a newer, more reliable vehicle, you must factor in your credit score.  The costs associated with problem credit are high - so be careful.

Conclusion

As you can see, and as we eluded too at the beginning, answering the question; "is my vehicle worth fixing?" is more involved than just knowing the vehicle’s value and the cost to repair. You really need to consider a wide array of factors to come up with the best decision for your particular circumstances. Get an estimate below to see what it will cost to replace your transmission.

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