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Lateral Upgrade

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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.

Car  Segment Model Approximate
Market Price
Additional
Investment
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.

You can always check you car value at IBB Car Valuation along with On Road Car prices.

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