I'm going to post 2-3 posts following this post, sharing updates to my original analysis. I'm just copying/pasting text from the other forum, so its documented here. feel free to contribute to the analysis, and I can run other assumptions for everyone.

 

after adjusting for configuration differences (including the $2800), I paid $0 more additional on top of a Hemi. I paid under Invoice price, and all the rebates applied equally to gas/diesel. perhaps some small rebates have changed, but remember not to mix up manufacturer rebates from ability to negotiate into the dealers gross profit at MSRP. Many confuse these two. Also, a richer configuration is typical on diesel cars and trucks, but you get this "richness" back in the residual value, so that cancels out in the quest to understand if the diesel pays back. Have to neutralize for configuration differences.

The way I look at the Eco diesel, is even if the Hemi gets an extra $1000 or even $1500 manufacturer (not dealer profit discount) that the diesel doesn't qualify for, the consumer is still profit ahead in under three years.

This means is you want a diesel, there is not financial reason to worry. If you want a gas engine for high RPM horsepower to do fast acceleration fun, then the Hemi is an easy choice as well, you will just pay more to have fun.

Remember my analysis doesn't assume that someone actually drives the Hemi hard, in which case, the diesel is a clear winner. A diesel driven hard doesn't see the same MPG drop that a gas engine does.

Also, my second part of my analysis will look at how actual published private party and dealer used truck prices vary between gas and diesel, and specifically, how the prices compare to the big valuation services companies (NADA, Kelly Blue Book, and Black Book). What I saw on the used market for German diesels was that the dealers discounted little from the used kelley blue book published price, whereas it was very easy to see gas engine used prices published below KBB, and then even easier to discount from there. If this holds true for trucks, then the diesel payback is even quicker than the 0.5 to 2 years I estimate above. This would also completely cancel out extra rebates that some may be getting on a gas engine but not a diesel.

 

Good comments by everyone. I did start changing some assumptions, like reflecting the increased oil change interval on the gas engine. this increases the diesel breakeven just a tad. Also, I see that the big used car valuation data sources now allow comparisons of a 1 year old Eco Diesel vs Hemi. This shows that after one year, holding all other options constant, the diesel EARNED money. This is not unusual; recall my observations on many quality german cars/SUVs, where the used diesel commanded more of a price premium over the gas engine, than it did when new. Looking at the three big used car valuation sites, the 1 year old diesel (15,000 miles, Laramie, 4x4, Crew) commanded a price premium average of $3597... whereas the diesel option when new was only $2850. Yes the diesel option in 2015 has increased to around $3100, but this analysis shows that the diesel engine didn't depreciate, it appreciated. Therefore, it is reasonable to conclude that at a minimum, the 3-4 year old diesel should be close to breakeven, before you consider fuel savings.

Remember that a much richer config that one may see on a diesel (that has nothing to do with the engine), is neutral in this analysis.... you will get back that "richness" back on resale/trade in, percentage wise.

 

Generally most good intellectual discussion centered around facts and data. So let's now stack the deck in favor of the Hemi, and see how long it takes to get to breakeven with the Eco Diesel.

First, let's bring the Hemi up to 10,000 mile oil change intervals. I personally would not want to go that long. Why? The eco diesel has more sump oil (takes longer for additives to break down), a much larger and better oil filter, and synthetic premium oil standard... making me feel safe going to the recommended 10,000 oil change interval. But that's ok, because we are not talking longevity, we are talking financials, for the select people that want to use that to make their engine choice decision. I still assume an oil change on the Eco Diesel is two and a half times the price of the Hemi. Many get oil changes free, and the diesel oil chg price will soon come down with competition/alternatives.

Gas prices: first, my sources is from the government, eia.gov. I pulled weekly average prices back to 2007. I actually found an error in my formula... for the gas prices I averaged back to 1994, but the diesel I averaged back to 2007. I now average both back to 2007. Didn't have much of an impact. To the point, stacking the deck... I saw the average diesel price premium over gas was $0.21/gallon. It varies through the year due to expected seasonality, up and down, but average was 0.21 since 2007, and the average within years were all close to this. For this new analysis, I assume the long running average going forward is that the diesel premium will be TWICE this amount, or $0.42/gal more than gas. Interesting fact I saw on the fuel economy.gov website, they show the E85 ethanol penalty. It costs a whopping 6 MPG penally from mid-grade gas. The posted figure of 17 assumes mid-grade gas no ethanol. If you want to use E85, the diesel is much advantaged, and we are trying to help the Hemi here. This explains why some are seeing Hemi MPG figures way below the 17 mixed EPA average, they are probably getting 10-15% ethanol and a big hit because of this.

Miles driven per year... I am stacking the deck in favor of the gas engine because I am assuming 11,700 miles/yr. If you drive more than this, the diesel gets more of an advantage.

Towing... reminder than my assumptions assume someone like me -- virtually NO towing, thus favoring the Hemi for financial breakeven. If you tow, a diesel sees less MPG penalty than a gas engine. That is a fact.

MPG... to give every advantage to the Hemi we can, I now selected only 2013 and 2014 trucks reporting hand calculated MPG on Fuelly.com, 5.7 engine. This is about 16.7, so slightly better than I had before, reflecting the 8 speed trans and other minor changes. The EcoDiesel on Fuelly is only 2014 data, so its MPG at 23.2 holds. Additional data, looking at the EPA website fueleconomy.gov, we see that the Hemi is 17 and the diesel is 22 for mixed driving. This makes sense... the EPA method to measure MPG is known to disadvantage diesels; diesel owners typically report slightly better MPG figures than the Govt figure. In this case, we see Fuelly.com users are 1.2 better or 5% better. That is actually what my truck is getting; I'm at 23.8 over 8000 carefully hand calculated miles (fully loaded limited, 4x4, crew). Gas engines on the other hand, typically do slightly worse than the mixed average MPG the Govt gives us. In this case, Fully.com users are only 0.3 MPG worse than the rated amount, so very close to the Govt.

Next, I now give the Hemi a $1000 rebate that the Eco Diesel doesn't qualify for. I actually got the same as the Hemi (a 1500 and 1000), but can appreciate this changes month to month.

Drum roll........ the breakeven analysis shows the Eco Diesel starts earning profit for its customer at 1.9 years. If you keep the Eco Diesel for 2 years or more, even in these worst case conditions, only looking at the financials, the Eco Diesel is the economic winner. The Hemi might win the beauty contest and have a higher fun factor, but the EcoD is quietly working away to generate net cash for you starting at 1.9 years.

Reminder... richness in configuration is (largely) irrelevant in this breakeven analysis. If you are forced to by a component that is standard on the diesel, that you can opt out of on the gas engine, you get the non-depreciated portion of that back. This analysis assume the configuration is the same between diesel and gas, other than the engine and the transmission (applies to the big diesels).

Last item... dealer greed. This is the only item that would force a longer breakeven for the diesel. Why did I say dealer and not Ram? Naturally, I explain... If you want a diesel, its fairly easy to plan in advance a purchase, sign up for clubs that mandate 10%+ discounts from MSRP to ANY engine/option. I qualified for the Supplier discount, so I could buy any engine at 1% below dealer invoice, which is roughly 9-10% off of MSRP if I recall correctly. In this case, the dealer profit in % is the same for any truck I choose. I just have to worry about rebates from Ram, and I handled that assumption further up in the analysis. Dealer greed becomes relevant in this breakeven analysis if you don't plan your purchase (e.g. sign up for one of the off roading clubs, that helps get you the flat discount), and try to purchase from dealer stock, where you have to negotiate from MSRP. So in this case, with high demand of the Eco Diesel, yes, you will have a longer breakeven. Add roughly a year to breakeven for every extra $1000 in profit you pay the profit hungry dealer. I left this out of this analysis, because for those who want/need a diesel, you do have options to plan ahead and ensure that the dealer can't take advantage of you with the short supply of the diesel. Generally, many want to order the diesel anyway, as it is hard to get all the options on a stock truck. I wanted LSD, ram box, crew, diesel, 4x4, short bed... and there was exactly 0 trucks in the country, searching every dealer in the US. So I knew I had to order.

In summary, if you stack the deck in favor of the Hemi, the breakeven does get pushed to 1.9 year, after which time, the diesel owner is profit ahead relative to the Hemi. If you normalize the assumptions, or tow, etc, your payback is much less than 1.9 years... unless you buy a diesel from stock and can't negotiate the dealer down to a % profit that is normal for a Hemi.

Let me know if you want me to run other scenarios. Great job keeping this intellectual and not emotional. So I don't get accused by the teaching for not showing my work, see pic below. Also look at the govt website pic showing how E85 gas hurts MPG vs regular gas (highlighted in yellow by them, not me).

 

 

For the record the hemi is not a flex fuel engine. The 3.6 and 4.7 are through.

 

Great write up oilbelcher. The pay back numbers are great factoring gas mileage alone, but resale should also be a major reason. Right now just having the diesel option pays back 100%+ on resale. Here are the current figures on a 2014....

 

If you tow, a diesel sees less MPG penalty than a gas engine. That is a fact.

Percentage wise between my 3.7L V6 and the EcoD it was exactly the same, 8MPG hit between empty and towing. Of course the EcoD gets a lot better mileage to start with but your fact isn't necessarily so.

 

It can't be exactly the same _percentage_ wise if they both took an 8mpg hit.

8mpg on a 27mpg base is a lower percentage than an 8mpg hit on a 23mpg base.

 

Help me out here with some of your assumptions as I can't read the spreadsheet. Where is the $2800 premium for the ED over the hemi? Where is the fact that one can easily get $10k of MSRP on a hemi and maybe $5k on a ED (today). That's $7,800 and all I saw on your assumptions was $1000.

edit: I reread your assumptions of the 9-10% of MSRP for the ED. On a $45k truck, 9% equals $4050 and 10% equals $4,500. Right now in my area, without going through the program you mention, Hemis are anywhere from $10k to $11k off. I don't see where you take that into account.

Another consideration when deciding ED vs Hemi is going to be reliability. Once past 100k miles, and warranty runs out, the Hemi wins hands down. Repairs for the hemi are fairly inexpensive. Diesel injector system repairs will cost as much as a whole new Hemi engine. Turbo issues will cost an arm and a leg. I am always amazed when my friends tell me how much it costs to repair their diesels, seems like the $8k figure keeps popping up.

There is a reason Chrysler will sell you a lifetime limited powertrain warranty on a hemi but not on a diesel. My current ram is a 2009 hemi that came with the lifetime free from the factory.

Without getting into too many details, my back of the envelope calculations show that the break even point is about 120k miles, and then the difference in resale goes to the diesel. Trying to do depreciation is all fun and all that but in the real world, prices for used vehicles depend on the economy at the time, the region, and if you can find a willing buyer and not trade it in. One can get all exited about how much their truck is worth but it's really meaningless when you trade it in.

 

And to me that is my problem with the ed. I want to keep this next vehicle 10+ years and if I have to start spending that kind of coin after 120k it to me is not worth it as gas doesn't have that headache. I am not looking at the resale because this will be with me for the long haul so when I do trade it in it will be run-down to the point of what I get out will be what ever. If I was trading every couple of years it would be different. Still need help on this one.

 

I got nearly 20% off of MSRP, with very little negotiation on my 2014....so if you are smart and wait until the opportune time, you could manage that on almost any config truck I would think. Obviously don't go out and buy the just released MODEL year, new features etc and do this. If you can't wait until the best rebates incentives etc, you really don't care about losing money on depreciation. I probably could have gotten 22-23% off if I had really buckled down on The salesman, but he was very helpful, helped me get I to the exact truck I wanted as it was still enroute from Detroit, and delivered it to me at the airport 70 miles away for free, and as a convenience to me, full of diesel and DEF. Sometimes, it's not all about the money...

 

That's what I'm thinking, I'm the kind of guy who waits for the right moment to get the deal I want. I'm in no hurry, my '09 has been paid for for over 2 years, it has 85k miles and a lifetime power-train warranty. I have been anticipating the ED since 2013 but the roll-out (at least here in Southern Cal) was very limited. For me money is not an issue, I'm 59 YO and been very comfortably retired for 4 years. I just haven't found the truck I want or a deal like yours. After reading about the percentage of owners with CELs, exhaust leaks, blown motors, jerky transmission, loose hardware, etc, etc, I'm thinking that next years model may be a better bet. Another consideration for me is that Ram is planning a major redesign for 2017.

Folks will say that CELs are no big issue, that they will eventually be taken care of. For me, CELs are a BIG issue as I hate going to the dealer for the runaround many here have gotten. If the 2015s are not being discounted to my satisfaction, then I will wait to the 2016s before the redesign, I bet they will be clearing the 2016s during the fall.

 

When did the HEMI get 100K spark plug intervals? The 09 I had was still 30K, which cost a whopping $700-$800 every 30K miles.

 

If you payed that much for a spark plug change you must like to be screwed. The plugs are $3 per plug and there are 16, so you payed $650 for labor? I have gotten a quite for $250 which is reasonable. For 2014 they went to iridium plugs so the interval got stretched to 100k.

 

The price was for a regular 30K interval....so plug change, oil change, inspection, and air filters. 3 hours labor, parts, and waste fees, yup every bit of $700. Not sure where you can get a $3 plug even online the cheapest is $5 a plug factoring in shipping and/or tax.

 

Ok, so at $10 per plug (which is ridiculously high for a copper plug) you have $160 in plugs, $35 for an oil change, $20 for 1 air filter, $300 for 3 hours of labor comes to a grand total of $515... Throw in $20 for a tire rotation and your at $535. If you truly paid that much they must have changed the front and rear brakes as well, and filled up the gas tank.
All Mopar parts has them for $4.29 shipped btw.

 

The dealer quoted $315 for just the plug change. I said to hell with it. I bought 16 plugs at the dealer for about $75. I did them myself in about 2 hours. They came out looking brand new.

 

That's what it's about. We are all here to lend a helping hand by providing our thoughts and experiences, but ultimately add long as each person is happy with their own decisions it doesn't matter what others think. If you paid more or bought a different model, engine or brand and you are really happy with your decision that is all that matters.

 

I did include the fact that the diesel oil change is 3x the price of gas oil chg.

Also i combined the up front $2800 Diesel engine price with the depreciation cost differential vs gas engine. This makes the summary a little more succinct and easier to look at for others. For the Eco diesel we are seeing that you get back the $2800 plus appreciation. The 2500 diesels (big three) saw a slight depreciation loss. So far the Eco diesel is displaying residuals that are characteristic of many German diesels, where the first owner benefits with the diesel option appreciating vs what they paid. Just wanted to clarify because of the earlier question.

I forgot to include the diesel fuel filter change, that would be a little more expensive than a gasoline filter, but I also forgot to include spark plug maintenance for gas Enginr, so those two probably cancel each other out for the most part, leaving us with the same result, at least financially speaking.

 

I'm trying to decide between Sport/Hemi vs Outdoorsman/Ecodiesel. I've read this entire thread......

Unfortunately for me, the price of Diesel in my area (Missouri) is .80 to .92 cents higher than gasoline per gallon.
$2.47 gas vs $3.39 Diesel at Quicktrip by my house.

It's basically a wash......
The money I would save with the Ecodiesel fuel mileage....... would be lost with the high price of Diesel fuel in Missouri.

I am still considering the Ecodiesel, because I occasionally pull a 5000 lb camper in the summer.
I would like having the torque available at a lower RPM. Right now my 2000 Chevy 5.3 Liter (with 4-speed transmission) is screaming at 4000 RPM, and searching for gears non-stop when towing my trailer. It sucks !!

I've driven Chevrolet all my life, but decided to switch to Ram or Ford when I buy a new truck in 2015. I hate the looks of the Chevrolet, and I still haven't decided if I want an aluminum Ford truck. I used to work on airplanes & helicopters, and I know how Aluminum corrodes if not treated properly.

So right now....... I'm trying to decide between Hemi or Ecodiesel.
I sure wish Diesel didn't cost so much more than gas around here....... My decision would already be made.

 

One comment I would make, if your decision is going to be purely economic, consider the likely residual value at the time you are expecting to get rid of the vehicle. WHile we cannot predict that, history has shown that the diesel will be worth considerably more than a gas truck. I expect, but sure do not know, that the same will be true for our ecodiesels. That could sway your decision. FOr me it was easy, I wanted one--no justification necessary. SO far no regrets

 

I currently still have a '13 Hemi Ram 1500 for work. I drive lots of highway (60k/yr) and have averaged around 17 mpg in OK and TX over that time. When I hook up my 14' trailer with my Jeep on it I get around 8 mpg and the truck is ALWAYS hunting for gears and shifting. It just does not feel right and I do not like the wear it is putting on it.

I just recently bought the '14 ED because I loved the way my '13 did everything but tow. A change of jobs requires me to have my own vehicle for the first time in about 10 yrs so I got to buy for me for once. I have yet to hook up the trailer and therefore cannot give my honest evaluation of that yet, but I am hopeful that it will fill the gap that the Hemi had.

 

Is your hemi a 8 speed or 6 speed?

 

It is the 8 speed and it is constantly switching between 5-7 when towing even on relatively flat hwy.

 

That's weird, mine would never hunt for gears, like ever. Put it in tow haul mode and it would stay in 7th until I pulled a hill, then it would go to 6th. I had 3.55's though so I'm assuming you have 3.21's.

 

I have had a few people who say the same, but I am in the TX panhandle and oklahoma. Lots of I40 is very flat here. I run it in tow mode as well and it would rarely stay in 7th unless running down hill. Mileage dropped to nothing and it would never stay in gear. I am not 100% sure on the rear end as I did not buy the truck, but I bet you are correct with the 3.21s.

 

The price difference between diesel and gas is largely normal for this time of year. It will flip back. Do do a proper business case, you look at diesel to gas price differentials through the year, across seasons. In my business case I look at Govt published prices each week, over last 5 years to get better idea of tr price relationship.

The typical break even for Diesel engine is 0-2 years max, unless you severely over pay for the truck (you allow dealer to make higher % profit on diesel vs gas). You must include higher residual value of the diesel to see the full benefit. That is often a greater benefit to diesel owners than fuel savings.

 

My bad. I'll try to watch my language in the future.

 

Another very simple view of break even is that the higher up front price of the engine is offset by the higher retained residual value, meaning that possible to be breakeven when you drive off the lot, day 1. The gas savings only need to offset higher oil change, considering higher fuel filter costs is offset by need to replace spark plugs on a gas engine. So no need to over analyze the diesel vs gas price per gallon. The diesel is an easy economic choice, even at low miles. The only time this breaks down is if you over pay for the Diesel engine, allowing high dealer profit. The manufacturer priced this correctly, so you only have to keep the dealer greed in check.

 

As for me I plan on keeping the eco for 10 plus years so as all of you like to point out the resale value I guess is the same as the residual value. For me this is pointless as after 10 to 15 years I really don't care what I get out of it or if I get anything at all because the way I see it if you want to buy a 15year old POS that I don't want anymore then I normally sell them for little to nothing anyway. Why try to get as much out of something that is going to start nickel and dime you to death. 245000 miles on a 1995 s-10. 200000 miles on a 2002 chevy trailblazer, and 150000 on a 2004 gmc canyon. Gas to me will last just as long and to be honest after 200000 I really don't want to have one due to the fact that squeaks, noises, and the ride just isn't there anymore, and of coarse new things come out.
The things that I wouldn't have to worry about is if the turbo goes out or the def, things that will cost alot more than what gas doesn't have well the cat back is there, I guess is the same. Sparkplugs fairly cheap and on todays vehicles 1 time change and no need to do it again if you keep it for 200k.

True diesel does get better mpg. For me I am ready to pull the trigger and for some reason I can't find a eco with the cattle-tan 4x4 3:55 rears, limited slip, black/tan exterior to save my life.

Now that I am ready I might have to drive to Cali to get one. The east coast sucks, I figure if I am going to have to pay a arm and a leg I might as well get what the h:::ll I want and down to the last bolt. Just my luck once I get it, it will have problems not to far down the road.

 

The wife's 2012 Hemi still seems new even though it's now over 150,000 miles. Well, maybe the exhaust note is slightly louder. She's only had to make minor repairs so far and it feels so solid that I can't imagine anything big coming up. And I get to inherit it when she gets the 3D!!! It'll be much more comfortable pulling the WaveRunners with the RAM rather than the Z28.