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Value Rating
Above Average
IntelliChoice Value Rating
The chart above shows the purchase price versus ownership cost for each car from a specific vehicle class. The cars with better than average ownership cost/purchase price correlations are the best values, and these best value cars are represented by the dots below the curve. (i.e. the cars that have a lower ownership cost compared to its purchase price.) Those cars, which are worse than average or poor values, appear above the curve.
One way to view the graph is to draw a vertical line through any purchase price. You may see several dots that fall on this line - each of which is a car with a similar purchase price. However, notice the difference in ownership costs of each car represented by the vertical position of the dot. Two cars with the same purchase price can have thousands of dollars difference in ownership costs. This is what separates "good value" cars from "poor value" cars.
What is a good car value?
A "good car value" is one whose cost to own and operate is less than expected. The lower the cost to own and operate a car compared to what is expected, the better the value of that car.
But how do we know a car's "expected cost"?
For each car in the class, IntelliChoice plots the car's purchase price against the total five-year cost to own and operate it as determined by IntelliChoice research. Each dot on the above chart represents a specific car. Generally, we find that as the purchase price of the car increases, the cost to own and operate that car increases. This is why the dots on the graph tend to rise upward and to the right. This phenomenon also makes intuitive sense - as the purchase price rises, financing costs tend to rise, as do insurance, depreciation, taxes, and most other car ownership costs.
This is an important concept. It's normal for car ownership costs to rise as purchase price rises. Therefore, we can't just establish one "average" ownership cost number for each class, since cars in the class have different purchase prices. (This is why the "Relative" shown on each chart is different for cars in the same car class.)
Using statistical techniques, IntelliChoice "connects the dots" to form a curve that defines, for this car class, the relationship between the car's purchase price and car's ownership costs. This curve is our "expected cost" curve. The curve defines, for any car in the class, the five-year ownership cost that we would expect to see at each possible purchase price. If every car in the class were an average value, then all the dots would fall exactly on the curve. However, it's rare that any dot is exactly on the curve. Some dots are a little higher or lower, and some are a lot higher or lower. The dots that are a little lower are better than average car values, while the dots that are a lot lower are excellent car values (A dot that is a lot lower than the curve has ownership costs much lower than expected for a car of its purchase price). Conversely, a dot a little higher than the curve is a poorer than average car value, while a dot that is much higher than the curve is a poor car value.
Value is a relative term, not an absolute term. It is performing better than the logical expectation.
So is a Mercedes-Benz E320 expensive to own and operate? Certainly in an absolute sense. Most other cars cost less. But, when its cost to own and operate is plotted against cars with comparable invoice prices, the E320 costs less. So the E320 is not expensive to own and operate - it is a good car value. The Mercedes does not have low ownership costs, but it has low ownership costs for its invoice price.
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Article From Motor Trend Magazine
First Drive: 2003 Volvo XC90SUV now stands for Swedish Utility Vehicle / Photography by Ron Sessions, the author, the Manufacturer /
Article provided by: Motor Trend Magazine
Whatever Volvo has learned from long winters spent in contemplation, it might be a hesitancy to rush into things. That may partly explain why, a dozen years after the Ford Explorer triggered a buyer stampede into sport/utility vehicles, Volvo is just now introducing its first SUV. Few companies other than Volvo have such a clearly defined brand character, a result of decades of honing its skills bringing sensible, practical, and safe personal transport to market. The contemplation is about to pay off, for Volvo and you, with the all-new XC90. It's the latest fruit of Volvo's large-car platform that previously bore the S80 luxury sedan, which means a transverse-engine, front-drive unit-body platform, in this case adaptable to all-wheel drive. This car/minivan-based configuration has worked well for the Acura MDX and Lexus RX 300. And it's a natural progression for Volvo, a marque that has virtually owned the Euro wagon market for decades.  The XC90 is more than just a wagon version of the S80. It casts a larger shadow (it's longer, wider, and loftier than the Mercedes-Benz M-Class or BMW X5), and it offers command-of-the-road seating for up to seven passengers. How high? The front seats have 6.5 in. in elevation over those of the Volvo XC70 wagon. Ground clearance and approach and departure angles, long the measures of a serious off-road SUV, nearly match those of the Ford Explorer. Converted from people- to cargo-carrying duty, the XC90 will swallow up to 93.2 cu ft of stuff, more than Toyota's Land Cruiser and nearly as much as the full-size Chevy Tahoe. Because it's a Volvo, the XC90 is packed with every safety feature, dynamic as well as passive, currently on company shelves. This includes the industry's first active rollover-protection system.  Never a slave to fashion, Volvo has been well served by its conservative bent. Still, a gentle transformation has been occurring under the direction of Peter Horbury, vice president and Volvo Cars chief designer. Volvo shapes have evolved from shipping-crate boxy and straightedge angular to somewhat organic and downright muscular, with a pronounced V-shaped frontal design. The new XC90 continues that trend. Clearly, this one comes from the car side of the ledger, though it boasts a decidedly in-your-face face. Volvo knows what a truck is, and you can see plenty of its big-rig 18-wheelers hauling hogs and hay over the interstates. ... >>next page
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