Will car repairs in the future financially cripple you?

In May 2008, Forbes Magazine released a list of the most expensive cars to repair. It's not surprising that luxury cars were at the top of the list. We accept that luxury cars cost more and that their repairs are pricier, too. But why should that be?

The answer is because luxury cars boast more advanced features. According to the Insurance Institute for Highway Safety (IIHA), the cost to fix a crumpled front corner bumper on a 2007 Hyundai Sonata following a 6 mph collision was $739 [source: IIHA]. The same test was conducted by the IIHA on luxury cars. By contrast, the Infiniti G35 racked up $3,544 in repairs for the same damaged front corner the Sonata endured [source: IIHA].

One reason body repairs on today's cars are expensive is the use of composite materials. In other words, as far as body repairs go, they don't make 'em like they used to. Materials like fiberglass make cars lighter, which increases fuel efficiency. But composites don't absorb impacts well, cosmetically speaking.

The high-tech gadgetry found aboard today's luxury cars also explains why high-end cars rack up big bills at the mechanic's garage. For instance, replacing a single Xenon headlight with a wiper system on a 2006 Mercedes C Class can cost $1,644 [source: BankRate]. The rearview camera (that helps you see what's behind you when you back up) installed on a 2004 Cadillac Escalade costs $4,217 to replace when it goes on the fritz [source: Weston]. Even the brakes on luxury cars can cost more to repair. Audis' brakes include adjusting sensors which have to be removed, complicating the brake replacement and driving up labor costs [source: Forbes].

Hybrid cars, too, are often more expensive to repair than a conventional car of a similar price class. In a hybrid vehicle, a conventional gasoline engine works in conjunction with an electric motor, or both can work independently of one another. This is a huge departure from conventional cars, whose power trains are driven exclusively by energy created from a conventional combustion engine. Hybrids are even different from all-electric cars, which run exclusively on batteries. Gas-electric hybrids require a special transmission -- the most predominant is the continuously variable transmission (CVT).

Due to a continuously variable transmission's unique design, replacement can be much more expensive than replacing an automatic or manual transmission on a conventional car. A new CVT on a 2001 to 2003 Toyota Prius, for instance, can cost around $8,695 [source: Consumer Guide Automotive].

Both hybrids and luxury cars represent the potential future of automotives. Since the repairs associated with these future-tech cars are pretty steep for those who can afford them, will future car repair bills be as high for the rest of us when we can afford these cars? Maybe not. Find out why on the next page.

When the Sony Corporation introduced the CDP-101 in 1982, it was the first mass-produced compact disc (CD) player available to the general public. It was a big, bulky component that accepted one CD at a time, but it represented the cutting edge of home audio. The price of this new technology reflected that uncommon status; each sold for about $700 [source: Nathan]. By 2008, you could purchase a Sony CD player that includes a five-disc changer for about $150 [source: Sony Style].

You'll notice that with Sony's CD players something strange happened. As the technology grew more desirable (for example, a CD player that could hold one disc versus models that can hold five), the price decreased rather than increased. This seems a bit counterintuitive, but it's actually based on a basic economic principle: supply and demand. When the supply of a product exceeds demands for it, the product's cost generally goes down. And when demand is greater than the supply, manufacturers and suppliers can raise the price. It gets a little more complicated when several manufacturers start making different versions of the same product. This leads to competition.

But competition also fosters affordability. With more suppliers of a similar product come more options for a consumer. One way to get a consumer to choose one item over another is to offer a lower price. This holds as true for high-tech automobiles as it does for CD players.

Think about it: Hybrid cars are currently more expensive to fix than cars that run on a conventional engine. That's because hybrids are less abundant than regular autos -- demand currently exceeds supply. In 2007, hybrid car sales accounted for just 2.2 percent of all car sales in the United States. While that seems small, the total sales in 2007 represented an increase of 38 percent over the total number sold in 2006. And 51 percent of all those hybrid car sales were Toyota Priuses [source: Associated Press].

So, sticking with our Prius example, if demand for the Prius continues, Toyota could be expected to produce more of the cars. With more people driving the cars, the customer base will expand. More customers needing repairs will attract more mechanics that specialize in fixing Toyota's hybrids. More mechanics trained in the specialized repairs will make the specialization less unique and more affordable.

The same holds true if Prius' most expensive component to repair -- the continuously variable transmission (CVT) -- is adopted by other car manufacturers. The system will be in plentiful supply, so the availability of parts will increase, which should cause the price to decrease. And this doesn't just apply to hybrid cars. It also applies to those Xenon headlights with built-in windshield wipers. Once they trickle down from the world of luxury automobiles to become a standard feature on mass-produced vehicles, the cost to repair and replace them will decrease, too.

In other words, as the future of automotive technology becomes the present, what's expensive now will decrease in price as the technology becomes less high-tech and more standardized. So while repairs for early adopters of futuristic cars may be a blow to budgets now, in the future, they should be a little easier to swallow.

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