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Economic Comparison: Honda Accord vs. Toyota Prius

Economic Comparison: Honda Accord vs. Toyota Prius. Team 3 Richard Do Peter Jo Lester Oestreich Carlos Ruiz Jane Veerachanavirut. Objective What car is a better deal in a 5-year period?. Honda Accord 2003. Toyota Prius 2003. Analysis Parameters. Economic Analysis Parameters. Financing

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Economic Comparison: Honda Accord vs. Toyota Prius

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  1. Economic Comparison:Honda Accord vs. Toyota Prius Team 3 Richard Do Peter Jo Lester Oestreich Carlos Ruiz Jane Veerachanavirut

  2. ObjectiveWhat car is a better deal in a 5-year period? Honda Accord 2003 Toyota Prius 2003

  3. Analysis Parameters

  4. Economic Analysis Parameters • Financing • Major Maintenance • Insurance • Salvage Value • Gas Costs • Scheduled/Minor Maintenance • License and Registration Fee

  5. Economic Analysis Method • Net Present Worth and Equivalent Uniform Cost • NPW=PW of cost – PW of benefits • EUC = P(A/P, i, n) - S(A/F, i, n) • 5-year Analysis Term • Minimum Attractive Rate of Return 10% • Sensitivity Analysis

  6. Initial Analysis Results • Toyota • NPW $48,305.09 • EUC $1,026.34 • Honda • NPW $43,208.82 • EUC $918.06

  7. Sensitivity Analysis • Factors affecting NPW • APR • Insurance • Gas Inflation • Downpayment • Analysis Term

  8. Conclusion • Honda Accord is the better buy based on: • Initial economical analysis. • Sensitivity analysis. • High maintenance cost of Toyota Prius offsets the savings of its fuel consumption. • References: • Toyota.com • Honda.com • KBB.com • Consumerreports.com • Eia.doe.gov

  9. Useful Resources Bankrate.com – www.bankrate.com • Offers current information on the best APR for each loan term new and used • Information on auto loans in general, credit score, buying • Car Buying Guides • Offers a variety of calculators on • How much you can afford? • New or Used? • Buy or Lease? Car Buying Tips - http://www.carbuyingtips.com/ • Car Buying Guides • Credit Reports, Car Loans, Quotes, and Warranty Information • Information on Financing, Lease, New, Used • Information on how to avoid fraud and current scams • Information on car insurance

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