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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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Review From Truck Trend Magazine
2009 Cadillac Escalade Photo Gallery: What's new for 2009 / By the Manufacturer / Photography by the Manufacturer /
Article provided by: Truck Trend Magazine
In 2009, Escalade extends that leadership thanks to the world's first hybrid in the large luxury SUV class, as well as a new ultra-luxury Platinum Edition with even more segment-first technologies. Escalade Hybrid delivers a 50-percent fuel economy improvement in city driving. A separate release outlining the Escalade Hybrid's features is part of Cadillac's 2009 product information. Escalade Platinum is the fullest expression of the brand's dramatic design, luxury and technology. The '09 Escalade Platinum becomes one of the most technically advanced SUVs with the additions of segment-first LED headlamps and the world's fastest-acting suspension, Cadillac's Magnetic Ride Control. Magnetic Ride Control, standard on the Platinum Edition, also becomes available as an option on other Escalade models in 2009. Escalade continues to offer the most complete model lineup in the luxury SUV category, with three distinct body styles. The standard Escalade is joined by the extended "maximum passenger and cargo space" ESV model, as well as the innovative EXT model. The EXT model features a reconfigurable cargo bed, including the segment-exclusive Midgate that enables the rear compartment to flex between passenger and cargo space. The Escalade lineup features integrated powertrain, chassis, safety and interior systems that deliver the most powerful, efficient luxury SUVs in the segment, led by a 6.2L all-aluminum V-8 engine with variable valve timing technology delivering 403 horsepower (301 kW) and 417 lb.-ft. of torque (565 Nm). The 6.2L engine has been revised to run using renewable E85 ethanol, making it a flex-fuel vehicle for the first time. The Escalade and Escalade ESV are available in AWD and 2WD configurations. The Escalade EXT sport-utility truck features standard, full-time AWD. A strong frame and chassis support the Escalade's robust powertrain and enable exceptional responsiveness and ride and handling smoothness.
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