Calculating the cost of driving a gas guzzler versus dumping a gas guzzler

I have a confession to make. Do you remember my parsimonious Prius, the one that gets 45 mile per gallon?

Well, it isn't the only car in the Burns family. Our other vehicle isn't a Zamboni. And you won't find it in our garage; it won't fit. It's a 2002 Chevrolet Suburban.

That's a big SUV. It will take on any rock pile in Big Bend National Park. It's the George Patton of SUVs. It's also big enough to haul our Airstream.

We didn't buy it because we love seeing big numbers on a gas pump. We bought it for the same reason we bought all the Jeeps that preceded it: to haul stuff.

It does this at about 13 miles per gallon. So with regular gas around $4 a gallon, it costs about 30 cents a mile to keep it moving. The Prius, on the other hand, costs about 9 cents a mile.

Let the gas tank get close to empty, and the Suburban can't be completely refilled because most pumps shut down at $75. Small wonder that sales of new SUVs plummeted and some car dealers won't accept SUVs in trade.

And that opens an interesting question. If an SUV is essentially worthless as a trade, is there a gas price that will compel you to simply junk it? Yes, but not yet.

Here's the math. If your SUV is worthless, it will be worth junking when the cost per mile of feeding it gasoline is greater than the cost per mile for fuel plus the cost per mile of the depreciation on a new vehicle. (The Junking Moment will be higher if you also consider financing costs and insurance, but we're going to keep it simple here.)

Let's assume a new car will lose about 80 percent of its value in the first 100,000 miles. That means a new $25,000 vehicle will lose $20,000 in 100,000 miles and cost about 20 cents a mile for depreciation. A $30,000 vehicle will cost about 24 cents a mile for depreciation, and a $40,000 vehicle will cost about 32 cents a mile for depreciation. Depreciation is the largest single cost, by far, of owning a car.

To throw the SUV away, we'd need to find a combination of new car depreciation and gas cost per mile that is less than the 30 cents it costs to run the Suburban.

Can it be done? Not quite.

Subtract the more efficient cost from the less efficient cost, and you have the amount you can spend on depreciation. At $4 a gallon, for instance, the difference between my 13 miles per gallon Suburban and a 40 miles per gallon replacement is about 21 cents a mile. So the replacement vehicle would need to cost about $25,000. Unlikely.

If gas goes to $6 a gallon, however, the Suburban would cost 46 cents a mile, 31 cents more than a 40 miles per gallon replacement vehicle. That vehicle could cost nearly $40,000. (A more sophisticated version of this is at edmonds.com; see "gas-guzzler" calculator.)

So what's the answer today? For the Burns family, it's simple. Don't buy a new vehicle. Drive less. Drive the gas-sipper as much as possible and the guzzler as little as possible.

Scott Burns is a syndicated columnist. He can be reached at scott@scottburns.com.