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Comment by BrentOzar | Hacker News Reader

> If driving for Uber instead caused you to have 500,000 miles on it

Try to find a 2010 Prius with over 300,000 miles. There are only a handful in the US because they fall apart long before 500,000 miles.

Depreciation isn't just about the car's value - it's also about the amount of mechanical work you have to put in for the suspension, tires, brakes, etc during the time that it goes from 150,000 miles to 500,000 miles.

My mom's 2010-era Prius is a good example. The dash displays failed at around 100,000 miles, and she bought a new car rather than pay $2,500 to have the dash pulled out and display replaced.

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> Try to find a 2010 Prius with over 300,000 miles.

This isn't hard to find when they're used for car service. They're harder to find on the used market because the people who put >300,000 miles on a car don't generally sell them while they still run.

> Depreciation isn't just about the car's value

Depreciation is just about the car's value. Repairs aren't depreciation.

And many of the people who drive as an occupation learn to repair their own vehicles, so they have lower repair costs than other people.

The point that he's making is that your figure includes survival bias-- you're looking only at the cars that "make it" rather than are scrapped before this point. And you're also ignoring that upkeep and maintenance isn't linear with mileage.

A big fraction of things that we consider depreciated to zero are still worth something. A big fraction fail before the point where we would do that. A big fraction incur larger operating costs later in their lifetime.

The full value of the car if you hadn't put any additional miles on it, and it hadn't died without you putting any additional miles on it, is $4000. That's the most you can lose, and you can't even lose that much because a car that needs a new engine and transmission is still worth some money as scrap metal and parts.

You may incur some repairs as a result of the additional miles, but that's not depreciation, and it's also not a covert cost you don't pay until later even though you're committing to it now. The cost of expected future repairs is already reflected in the market value. The cost of past and present repairs is not a hidden future cost.

> That's the most you can lose,

It's not the most you can lose, because you have a bunch of repeated times where you're making a choice about whether to repair or not, and then whether to keep in service driving it. You can easily be wrong or get unlucky. You can choose to do an expensive repair because it seems to be the thing that preserves the most value, and continue to drive it for Uber because you expect to have a good operating history from this point.

It's the most you can lose from depreciation, which I reiterate was the original claim.

You can incur arbitrarily high operating costs if you're unlucky, but if you're unlucky you can incur arbitrarily high operating costs without putting any additional miles on it. There is a reason the vehicles used in car service skew towards specific models with a strong reliability record.

> Depreciation is just about the car's value. Repairs aren't depreciation.

The cost to maintain and repair affects a car's value, though, at least for commodity cars (classic and rare cars are of course a different scenario). Mileage is a proxy for the likely extent of repair and maintenance a car needs.

Which is why the bluebook value of the car with more miles on it was $1500 lower.

It's a $4000 car. It can't lose more than $4000 in value.

But those kilometres on it can cost more than the 4000. So value drops by 1500, but you could have spend the original value and extra 4000 to get there.

If the car needs $9000 in repairs but it's a $4000 car, you haven't lost $9000 because you don't do the repairs. You've lost the $4000 value of the car, less whatever you can get for it as scrap.

If the car needs $400 in repairs, you might find it worthwhile to do the repairs, but that's not depreciation.

Once you're driving a 2010 Prius with >300,000 miles on it already, you're taking an awful risk basing your livelihood on that car continuing to function every day. If you're dependent on ride share work for income, surely you get rid of the high miler at some point?

Cars are a fungible commodity. If something not worth fixing happens to it, you can buy another one then. If it still runs or can be repaired for much less than it costs to buy another car, why do it now?

Finding another car takes work and involves risk, both of which you'd rather do less often than more often.

Cars used in car service commonly exceed 300,000 miles. There are tales of some that do millions. For commercial trucks that isn't even uncommon.

And 500,000 miles was chosen as an extreme case to demonstrate that you're not going to incur a lot of "depreciation" no matter how many miles you put on something.

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