It's the oldest criticism of buying new versus used – drive that fresh-from-the-factory 2007 model off the dealer lot and instantly chuck 5 - 10% of your investment right out the window. The minute its front wheels touch Main Street USA your brand new car becomes used. This is why resale value is so important, as most vehicles only retain about 35% of their value after five years according to Kelley Blue Book.KBB has just announced the winners of its 2007 Best Resale Value Awards, which should help shoppers make a more informed decision when looking for a car that will hold its value. Keep in mind, however, that these awards are given to 2007 models, the value of which over time is just being projected by KBB, so there are no guarantees.
Follow the jump to learn which models age with the most grace and remain highly valued.
[Source: KBB.com]
The list is populated for the most part by brands and models you'd expect. Honda and Acura have vehicles that hold their value best as a brand, and of the ten categories these two brands account for four spots (sedan: Acura TSX, coupe: Honda Civic, sporty utility: Acura MDX, van/minivan: Honda Odyssey). BMW manages to pick up three spots total thanks to the MINI Cooper projecting the best resale value among both convertibles and hatchbacks, while the BMW 5-Series is the value retention leader among luxury vehicles. Toyota earned category awards for pickups (Toyota Tacoma) and hybrids (Toyota Prius). Finally VeeDub's Passat Wagon landed atop the wagon category.
The only domestic model you'll find any list is the Pontiac Solstice, which was chosen as one of KBB's Top 10 Models for Best Resale Value. You can check out the rest of that list below along with all the winners chosen.
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Reader Comments (Page 1 of 1)
required @ Dec 4th 2006 6:34PM
Welcome to CNN a week ago
http://www.cnn.com/2006/AUTOS/11/27/kbb_best_resale_value/index.html
Tool @ Dec 4th 2006 7:46PM
Thanks for the timely update!
Mike @ Dec 4th 2006 7:52PM
Maybe now BMW can stop running all those moronic ads about how buying their cars is a good investment?
Michael Karesh @ Dec 4th 2006 8:20PM
One very important thing to realize is that this is depreciation from MSRP. So for cars that you can buy with big rebates and/or big discounts, it greatly exaggerates how much they will depreciate.
As a result, KBB is measuring a model's ability to sell at or near MSRP as much as it's measuring depreciation.
Vik @ Dec 4th 2006 8:34PM
Who would have thought the only domestic on this list would be a Pontiac. Weird...
Jaimie B @ Dec 4th 2006 9:33PM
One domestic car make out of the 20 listed - now that's sad. What's even sadder is that it was included only out of pity.
BOB @ Dec 4th 2006 10:37PM
Numbers 5 and 6 -- read number 4. The rare US car selling at or above sticker is going to be high on this type of list. For Honda and Acura, this list is real. For domestics on rebate or incentive, it is not real (not saying domestics hold like Hondas)
I bought a 2000 Mustang GT conv with 20K for $14000 30 months ago, and could sell it now, with 43K, for $12,000, so there are a few bright spots among the Americans. (Gee, it's the cars people want, lol)
UH2L @ Dec 5th 2006 12:30AM
Real automotive enthusiasts don't buy cars for their resale value. Cars are bad investments anyway.
#4 Michael, ditto on the effective resale value which always seems to get overlooked.
Why pay more for a car with a higher resale value and have more money tied up in a depreciating investment anyway? You could buy a car with lower resale value (and lower price with rebates), invest the money you saved in a CD at 5% for instance and come out ahead.
Resale value means nothing when a person never sells the car and runs it into the ground. It's just money on paper then. What matters is cost of maintenance, parts and labor as things need to get replaced. Of course durability matters then too. One can't deny that resale is very important for leasing. Incentives can help here too though.
Jaimie B. is a Loser @ Dec 5th 2006 12:50AM
"One domestic car make out of the 20 listed - now that's sad. What's even sadder is that it was included only out of pity."
Was it?
miklm @ Dec 5th 2006 1:29AM
#4: "As a result, KBB is measuring a model's ability to sell at or near MSRP as much as it's measuring depreciation."
True, but doesn't it say something for a brand that struggles to sell anywhere near MSRP? Its long been established as a problem for domestic makes that they can't sell without over-the-top promotions and incentives, whereas brands like Nissan and BMW generally don't mark down cars at all. Those brands generally are in demand, and thus retain good resale value as well.
Still, that doesn't make it any less foolish to buy a new car on the basis of resale. If you drive used cars and buy smart, you can often drive for a year or more and get your purchase price back when you resale. I usually make money or at least break even on motorcycles which I keep for a year at a time, or less.
Richard Warren @ Dec 5th 2006 4:16AM
Michael, right on! #8 right with you.
"This is why resale value is so important, as most vehicles only retain about 35% of their value after five years according to Kelley Blue Book."
1950's American cars hold about 40% of their value at trade in, fast forward 50 years, see statement above. Not much has changed. Cars in general are a piss poor investment.
SherbornSean @ Dec 5th 2006 7:28AM
KBB, as well as others, continues to miss the point about resale values, because they compare market values today with MSRP from 5 years ago. But you didn't pay MSRP 5 years ago, you paid $500 under invoice. Right?
If you equalize for what people actually pay out the door, you find that resale values are fairly constant across vehicles, slightly favoring brands that are perceived as more reliable (Honda), easily repaired (Volvo) or trendy (BMW).
These lists are a waste of time designed to cater to advertisers.
TL @ Dec 5th 2006 12:13PM
Only one American car, such a shame
Chris @ Dec 5th 2006 6:52PM
KBB can come up with the 10 best value holders...lets see AB come up with the WORST! My contribution, the fabulous 2006 Dodge Ram SRT-10. In regular cab it carries an MSRP around $45k and on the used market that same low milage 2006 will garnish its owner a very fine $32k netting the owner a $13k tab just in a single year's depreciation.