TCO and ROI: A Cadillac Perspective

This summer I traded in my beloved Toyota 4 runner for a Cadillac CTS V Black Diamond edition.  There was no issue with the 4 Runner and I owed nothing on it.  I was not in need of an extra payment, I just wanted the V.  Maybe it was a mid-life crisis, maybe it was something else.  In reality it was the car itself, something about a Corvette super car engine in iconic Cadillac luxury.  Something about a sports car that can take a stock Porsche off the line in a brand that most assume comes standard with a walker and a turn-signal that never turns off.  Something about sitting comfortably in an American made car that could dust the top German luxury sport cars at 20K less in price.  I love my decision.

When making my decision I went through a thought process very similar to assessing data center infrastructure (ok that’s a total lie it was a spur of the moment decision that went from thought to purchase in less then a week, but it could have gone something like the following.)

Step 1: The Requirements

My requirements for a new vehicle were:

  • Sports car or SUV based on personal taste.  (I want vendor X, or I don’t want vendor Y)
  • Creature Comforts: leather, heated seats, navigation.
    • Cooled seats, OnStar type service, Satellite radio preferred but optional.
  • Aesthetics, something that fit my tastes from a looks perspective.
    • Preferably something that not everyone on the road would be driving.
  • Reasonable maintenance costs/reliability.
  • Adequate trunk space, interior space. (this was going to be my primary vehicle.)
    • 4 Doors preferred for convenience.
  • New vehicle (no refurbished equipment)

Non factors (things that factor in to an average car purchase but were not important to me):

  • Gas-mileage
  • Safety rating
  • Brand / country of origin
  • etc.

Step 2: Narrowing the Playing Field

I narrowed down the vehicles I would be happy with to the following:

  • Jeep Grand Cherokee
  • BMW M5
  • Toyota 4 Runner
  • Land Rover Range Rover
  • Cadillac Escalade
  • Cadillac CTS-V sedan
  • Tesla Roadster

Step 3: ROI and TCO calculations

Next came reality, I had my options that met my requirements to varying degrees, now I had to look at costs.  Starting with initial price I placed the vehicles in order low to high.

  • Toyota 4 Runner
  • Jeep Grand Cherokee
  • Cadillac Escalade
  • Cadillac CTS-V sedan
  • BMW M5
  • Land Rover Range Rover 120K
  • Tesla Roadster 118K

Now in true solution assessment fashion I dropped the top and bottom price options from the running (Tesla and 4-Runner), leaving me with 5 options.  Next it was time to look at TCO.  TCO on a vehicle would include things like gas-mileage, fuel type, maintenance costs, reliability, etc.  Of my remaining options the Grand Cherokee and Escalade looked the best for reliability and maintenance.  I dropped the Range Rover at this point after hearing some horror stories on repair cost and frequency (I did not validate these claims as I don’t care to invest the time so I’m not saying they actually have these problems, hearing they did was enough to drop them with this many great options.)

Down to four options, two in the SUV category and 2 in the sports sedan category it was time to decide what type of vehicle was I most interested in.  Both types met my requirements but I’d been in an SUV for the last 4 years and was ready for a change.  The decision was down to two: CTS-V or the M5.

Between the two the Cadillac had the better maintenance plan, greater stock feature set (amazing what BMW considers extra on an M5) and was solidly the faster vehicle.  Additionally the Black Diamond special edition was exactly to my tastes for style, and would be much more unique on the road than an M5.  I ultimately settled on the Cadillac and have been very happy with the decision.  It wasn’t the lowest TCO of all of the options fitting my requirements, but it most closely fit my total requirements and optional features at an acceptable TCO.

Summary:

When making IT purchase decisions remember that cost isn’t everything.  All too often I work with people that are so wrapped up in TCO conversations they forget to assess what the business objectives of the infrastructure are.  Cheaper solutions that can’t properly deliver the services required by the business, or scale with growth are not better solutions.  Starr the process with the business, defining requirements and assessing possible solutions.  Leave cost to the end.

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Comments

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