Trading in the SUV or truck?
This is a bad time to do it. I was talking to a family member today about trading her SUV for a Jetta TDI or one of the hybrids. Those vehicles would obviously get a lot better mileage than the SUV. But how much can you really save?
First of all, trade-in values on SUVs and trucks right now are low due to the numbers of them being traded in for smaller vehicles.
Second, the actual fuel savings for most drivers even in these super-economical cars are not all that impressive compared to savings of not paying all of the interest and depreciation on a new car. An SUV that gets 17 mpg and is driven 15,000 miles per year will use 882 gallons of gas a year. A 40 mpg diesel or hybrid would use 375 gallons. At $3 a gallon, the diesel or hybrid is going to save the driver $1,500 a year. Compared to an older vehicle that's paid off or nearly so, it isn't worth basically giving away the SUV and then going into hock for $20,000 to save $1,500 a year.
Third, if it's really time to trade anyhow because a new vehicle is needed, the "hot" diesel and hybrid models probably aren't the best deals. A car that's going to get in the high 20s or around 30 mpg that you can get for $5,000 to $10,000 less than a diesel or hybrid is going to be cheaper in the long run for almost everyone. The difference between 28 mpg and 40 mpg for a 15,000 mile a year driver is only 161 gallons of fuel a year -- or about $500. Compare that to what you save by getting the car that's $5,000 (or more) less expensive.
Fourth, fuel prices will probably retreat some after Labor Day. Most analysts don't think the current prices are sustainable in the near term. Over the long term, prices will continue to rise, so obviously people should consider gas mileage in any new vehicle they buy. But it's not a crisis situation, and people may want to think over what vehicle's really best for them and take into consideration the total cost of ownership rather than rushing out right now and buying the one with the highest advertised fuel economy.