Talk about Voodoo economics! Paying cash for any substantial durable good that has high depreciation is crazy. Borrow the money at 2017 dollar rates and pay it back with dollars that are worth less in the future. The interest rate is the issue here too. If you have good credit banks and others are willing to go as low as 2%. That is virtually free money as long as inflation is at or above that number.
There are also other considerations: The cost of maintenance on an older vehicle rises over time along with the cost of labor and parts to maintain it. New vehicles have a warranty.
There is also a reliability factor to consider.
So I don't think the issue is as straight forward as it would seem.
Was this purchase the OP talked about a wise one? Probably not economically speaking. And it sure sounds as if the guy paid full price...not counting what came off in the over generous allowance for his current truck.
There are also other considerations in buying new vs used cash vs financing.
One of my favorite cars I owned was my 1995 BMW 740 IL. At about $74k new it was not cheap. But when I sold it in 2007 with more than 100 thousand miles on it it was by far the cheapest car I have ever owned in terms of real cost both operating and overall. It never needed even so much as a light bulb until 2006. And when I sold it it was like new. Solid, quiet ungodly fast and needed nothing.
So just because a vehicle is expensive doesn't mean you will lose your shirt on it. But it does depend on what vehicle you buy. And of course I financed that car it would have been the height of folly to pay cash even at the low depreciation rate of the BMW.
