uncle fishhead
Well-known member
It occurs to me that one beneficial side effect of the proposed settlement is that there is now a reason for TDI values to jump.
At this point, there's still a bit of risk because it's not certain that the settlement will be approved. But it's now likely. At the end of July, it will be more certain, and once final approval occurs in September, certain.
Here's the rationale. There are three time periods for owners.
1) You owned the car at the beginning of the fiasco (Sept., 2015)
2) You bought in after the problem was uncovered, but before June 28, 2016
3) You bought after June 28, 2016.
Only the people in middle are treated differently. They have to share their settlement with the previous owner. But in the case of the old owners and the new owners, they get the full settlement.
So, I can buy a TDI today and get the settlement at some point during the next 2 years. As long as the settlement is approved and the car doesn't get totaled and continues to run.....I'll be able to exit at a known price.
Think how this works for someone who needs a car and likes the idea of a TDI. He can treat this essentially as a low (or no) cost lease. It even has mileage caps similar to a low mileage lease deal.
If I pay full settlement value for a TDI today, I can essentially drive for 2 years at no cost and then transfer it to VW. Darned good deal.
If I park it for 2 years, I'll end up with low mileage... getting extra $$ for transferring it. In two years, the mileage adjustment will increase by ~25,000 miles, meaning the settlement amount will increase by ~$1500 (I'm using a 2012 as my example, but the behavior is not unique to any one type of VW). That's 7-10% ROI. Not a huge win, but way better than a 2yr. CD or a Treasury bill/bond.
The above transactions are at settlement value. But someone needing a car for a couple of years might be willing to pay above that amount. Someone wanting to escape TDI purgatory might want to accept less. But the price for used TDIs should tend towards the settlement amounts, particularly after the deal is approved.
The values have not updated yet...The first result from a "TDI for sale" google search finds a 2015 Jetta 4D SEL TDI in Seattle for $20,991. The buyback w/o considering mileage is $28K (and the mileage is very low...so it will actually be higher). You can buy this car, drive it for two years, and make $7K! There are many other candidates. Or just park it for 3 months and make 7K. So I predict prices will now start to rise.
At this point, there's still a bit of risk because it's not certain that the settlement will be approved. But it's now likely. At the end of July, it will be more certain, and once final approval occurs in September, certain.
Here's the rationale. There are three time periods for owners.
1) You owned the car at the beginning of the fiasco (Sept., 2015)
2) You bought in after the problem was uncovered, but before June 28, 2016
3) You bought after June 28, 2016.
Only the people in middle are treated differently. They have to share their settlement with the previous owner. But in the case of the old owners and the new owners, they get the full settlement.
So, I can buy a TDI today and get the settlement at some point during the next 2 years. As long as the settlement is approved and the car doesn't get totaled and continues to run.....I'll be able to exit at a known price.
Think how this works for someone who needs a car and likes the idea of a TDI. He can treat this essentially as a low (or no) cost lease. It even has mileage caps similar to a low mileage lease deal.
If I pay full settlement value for a TDI today, I can essentially drive for 2 years at no cost and then transfer it to VW. Darned good deal.
If I park it for 2 years, I'll end up with low mileage... getting extra $$ for transferring it. In two years, the mileage adjustment will increase by ~25,000 miles, meaning the settlement amount will increase by ~$1500 (I'm using a 2012 as my example, but the behavior is not unique to any one type of VW). That's 7-10% ROI. Not a huge win, but way better than a 2yr. CD or a Treasury bill/bond.
The above transactions are at settlement value. But someone needing a car for a couple of years might be willing to pay above that amount. Someone wanting to escape TDI purgatory might want to accept less. But the price for used TDIs should tend towards the settlement amounts, particularly after the deal is approved.
The values have not updated yet...The first result from a "TDI for sale" google search finds a 2015 Jetta 4D SEL TDI in Seattle for $20,991. The buyback w/o considering mileage is $28K (and the mileage is very low...so it will actually be higher). You can buy this car, drive it for two years, and make $7K! There are many other candidates. Or just park it for 3 months and make 7K. So I predict prices will now start to rise.