Many of us dreamt of owning a premium sedan or fully fledged SUV. Consider you drive a 4 year old Swift VXi, a typical hatchback every Tom, Dick and Harry has in India. If you try to sell this car, you will end up getting a ballpark figure of Rs 3 lakhs. To upgrade to a new premium sedan, you require roughly Rs 12-14 lakhs! That’s some serious amount of money; add to that the rate of interest and hefty premium per month you are staring at an additional investment of Rs 20+ Lakhs in a course of five years. These figures, for sure made you think to hold onto to your trusty Swift. But, we at IBB introduce to you a cheat code that can get you a premium sedan or a luxo-barge, without breaking your bank as well as head. It is called a Lateral upgrade.
What is a lateral upgrade?
Lateral upgrade is selling your used car and buying another used car from a segment which is one or two segment higher, at a significantly lower cost. Lets again come back to the same Swift, sell it and you get Rs 3 lakhs. Put another two to three lakhs of rupees and see the options you get in the used car market.
|Honda City||Sedan||2012-13||4 Lakhs||1 Lakhs|
|Fiat Linea||Sedan||2012-13||3 Lakhs||NIL|
|Hyundai Verna Fluidic||Sedan||2012-13||5 Lakhs||2 Lakhs|
|Mahindra Scorpio||SUV||2010-11||5 Lakhs||2 Lakhs|
|Honda Civic||Premium Sedan||2009-10||4.5 Lakhs||1.5 Lakhs|
|Toyota Corolla||Premium Sedan||2010-11||5 Lakhs||2 Lakhs|
|Honda Accord||High End Premium Segment||2010-12||6 Lakhs||3 Lakhs|
|Chevrolet Cruze||Premium Sedan||2011-12||6 Lakhs||3 Lakhs|
|Ford Fiesta||Sedan||2012-13||5 Lakhs||2 Lakhs|
Tips for Maximum Benefit from Lateral Upgrades
- Basic Rule- Buy used car. The first few years of heavy depreciation brings the car price considerably.
- Avoid Car with high resale value- Avoid cars like Innova, Dzire etc having high resale value while upgrading.
- Buy a depreciation disaster- Especially cars in the higher end of the spectrum depreciates faster. Also, able but not popular cars like Linea, Accord and Cruze lose huge value just in a span of one to two years of its initial life cycle.
- Reliability Matters- Always buy a reliable car while you upgrade. Always remember, only cars depreciate in value, not its spares. Buying an unreliable premium car can throw nasty surprises at service centers. Critical parts can cost you a bomb.
- Newer the Better- Try searching for a newer model and low mileage ones. A less kilometer done car will be more reliable than one clocked lot many kilometers on the odo.
- Search, Research, Repeat- Be patient, keep looking for the best deals.