Recently, I was reading a Forbes article about the insane depreciation on luxury cars and the writer primarily blamed Tesla for this dramatically escalating trend. One example cited in the article was the BMW 3 series, which was reported after three years to go from $33,000 new to $13,000 trade-in value used. The purported correlation between this crazy depreciation and Tesla is the company’s reported conquest buyers from other luxury brands, which makes up 20% of their sales. While this is impressive, I don’t think the “Tesla effect,” as they called it, has much to do with crazy depreciation. In my opinion, it’s the “Hooptie effect” that’s causing these luxury cars to plummet in value and exhibit A in this argument is my latest purchase, a 2008 BMW 760Li that I bought for only $4,500.
With an original MSRP of over $130,000, this 760Li was the flagship of the BMW line. It has a silky-smooth V12, nearly every luxury feature available in 2008 and a smooth, satisfying ride. It even shares the same V12 as my Rolls-Royce Phantom and offers an experience similar to my expensive top-tier land yacht — but it was only $4,500! That’s insanely cheap and it has a clean title and accident history. It runs and drives well enough.
I say runs and drives but it does way more than that. In many ways, it’s superior to my Phantom. The seats for the 760Li have endless adjustment and are heated and cooled. The quality of the interior is great as well, with nice ornate touches like the contrasting wood inlay throughout the trim work and a suede headliner. The technology is much more advanced than my Phantom as well, with features like active cruise control and a night vision camera. Since the L badge on the trunk stands for long wheelbase, the back seat is a very nice place to be as well with reclining seats, electric sunshades and tons of room. This much luxury for only $4,500 is ridiculously cheap and it’s hard to understand why a car of this stature would depreciate to hooptie levels — until you start driving it.
Upon startup, it’s immediately obvious that something is wrong with the V12 engine, as it misfires badly at idle and feels like a good fraction of its 420 horses are very sick. Of course, since it’s an aging BMW, every single warning light is on, though it still floats down the road just fine. Clearly, this car was traded into my local Toyota dealer because it had become a hooptie and that’s becoming more commonplace with all luxury cars. With so much technology and engineering stuffed into these things, there’s much more that can go wrong and as the repairs pile up, they’re not worth fixing.
In my opinion, this is why luxury cars depreciate with such ferocity nowadays, as they are more likely to become impractical to own as they age when compared to more sensible choices. Still, I bought this 760Li because I had a feeling it might be the car would break my BMW curse. So far, every cheap example I’ve purchased for my YouTube follies has been a disaster, with repair estimates that exceed the value of the car — but for some reason, I thought this complicated V12 land yacht would be different. Turns out I was kind of right.
After my regular mechanic, the Car Wizard, asked me not to give him another big project, especially a BMW, I took my latest purchase to a BMW specialist for his detailed inspection. Amazingly, he thinks all of the warning lights and leaks can be vanquished for under $3,000, which, if he’s right, would mean I’m into this luxury barge for around the same money as Apple Computer’s most expensive MacBook Pro. It also means my curse with BMW purchases might finally be broken, which is close enough to the holiday season for me to call it a Christmas miracle. We’ll see… Find a BMW 760Li for sale