American automakers are ramping up production, which means new cars are in demand.

But according to AAA, the average age of a car on the road today is 11 years old. Many people wonder when to fix up their old car or trade up to a new one.

Bill Letso is arm-deep, fixing the timing belt and water pump in a 1999 chrysler 300 with 137,000 miles. It's a $700fix and possibly driver error.

"This could have been avoided. His water pump was leaking really badly. If he would have had his oil changed, or had it inspected, he would have saw that and now we're going to start this, he has a 50/50 chance on ruining the engine," says Letso.

The diagnosis: This car will make it through the repair. But the next car over might not be so lucky.

"We found no compression and it sounded like the timing belt was freewheeling, not connected anymore," says technician Bob Flora.

That's the same issue as the Chrysler, one year younger with 114,000 miles, but other one major issue.

"We pulled the rocker cover off, you could see the valve clearance here. These shouldn't be moving freely like that," says Flora.

To fix just that problem, this car owner is looking at another $1,200 or $1,400.

Diagnosis? This one should get scrapped.

The simple formula is: If the cost of repairs is greater than the value of the car, or one year's worth of monthly payments, it's time to get another vehicle.

Letso says it's worth fixing if, "it's a$2,000 repair, but if you go and buy a car after you go and put a down payment down, which is usually $2,000, you still have your monthly payments."