Autoblog

Residual Value Report: Ford cars make big jump

Zach Bowman — Tue, 08 Jun 2010 09:40:00 EST

Filed under: Car Buying, Earnings/Financials

The Automotive Lease Guide has just released its annual report of residual values. Thanks to slimmed production and lower incentives, both Ford and Chevrolet saw jumps of 11 and 7.5 percentage points, respectively, compared to five years ago, and a number of other manufacturers saw the worth of their products climb as well. Ford's passenger cars managed to rank second in the highest improvement since 2005 with a residual value of 48.8 percent. Both Ford and Chevrolet trucks are counted separately in the survey because of their disproportionately high residual value.

Both Suzuki and Hyundai found themselves on the top five list of improved residual value with 12.6 and 9.1 respective percentage point jumps over 2005 - healthy numbers. But for as much as those brands have improved over the last half decade, others, like Porsche, Volvo and BMW have seen their numbers fall.

Porsche has taken the biggest hit, with the company's residual value falling to 44.4 percent - an 8.2 percentage point drop since 2005.

[Source: Automotive News]

Residual Value Report: Ford cars make big jump originally appeared on Autoblog on Tue, 08 Jun 2010 09:40:00 EST. Please see our terms for use of feeds.

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Ford brags about largest residual value increase in industry - $1,300+ year-over-year

Chris Shunk — Tue, 22 Dec 2009 08:58:00 EST

Filed under: Ford

2010 Ford Fusion Sport - Click above for high-res image gallery

Residual values tell you a lot about a vehicle. If a car or truck has good quality and has plenty of customer demand it will have high residuals. If it's a lemon on wheels, clogging the rental lots, it will carry poor residuals. Detroit automakers have fared poorly in residual values for quite a few years, but it appears Ford may have taken a big step towards correcting that problem.

Ford is gleefully touting the results of the ALG January/February 2010 Residual Value Forecast for a good reason; the residuals of Ford, Lincoln and Mercury vehicles went up by $1,310 versus the January/February 2009 numbers. The residual values are based off of a formula that shows how much 2010 vehicles will be worth 36 months after purchase and Ford maintains the increase in residuals has a lot to do with the success of its latest redesigns and improved quality.

Proof of Ford's improved 36-month value scores comes in a comparison of the Fusion versus the Toyota Camry. The Fusion is now reportedly worth $687 more than the Camry after three years. The Ford Flex enjoys an even more decisive win versus the Toyota Highlander, as the boxy Blue Oval-branded wagon will reportedly be worth $1,800 more in three years. The 2010 Taurus scored the biggest increase, but not against the foreign competition. The smartly restyled sedan is worth $4,862 more after three years than the invisible 2009 Taurus. Both the Taurus and the Super Duty won the Kelly Blue Book Best Residual Value award in their respective segments.

A big reason Ford's residual values have skyrocketed in only one year is due to the automaker's improved status amongst customers. Fresh data from research firm Compete, Inc reportedly shows that the Blue Oval has surpassed Toyota in overall customer consideration for the past three months. Ford hasn't passed Toyota in Compete's customer satisfaction index since the firm began collecting data in 2002. Hit the jump to read over the Ford press release.

Gallery: 2010 Ford Fusion Sport

[Source: Ford]

Continue reading Ford brags about largest residual value increase in industry - $1,300+ year-over-year

Ford brags about largest residual value increase in industry - $1,300+ year-over-year originally appeared on Autoblog on Tue, 22 Dec 2009 08:58:00 EST. Please see our terms for use of feeds.

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Toyota tops Kelley Blue Book best resale value awards

Jeremy Korzeniewski — Thu, 03 Dec 2009 07:58:00 EST

Filed under: Car Buying, Lexus, Toyota

According to the experts-of-such-things at Kelley Blue Book, the average vehicle will only retain about 35 percent of its original value after the initial five-year ownership period, often making depreciation the greatest expense incurred by drivers over that time period. That's a hefty chunk of change to be sure, so a vehicle's anticipated resale value should be of prime concern when shopping for your next car or truck.

Since 2003, KBB has published its Best Resale Value Awards, which seek to inform consumers of projected resale value for any particular model after five years and 75,000 miles worth of service. Considering its historic reputation for quality, it comes as little surprise that Toyota takes home the trophy as the brand with the best projected resale value and that its subsidiary Lexus grabs the award in the luxury category. We have to wonder, though, how the company's many current woes might damage its perceived value down the line.

Making up the Top 10 Models for 2010 are the Audi A5, BMW M3, Chevrolet Corvette and Camaro SS, Honda CR-V, Mini Cooper and Clubman along with the Prius, RAV4 and Tacoma from Toyota. See here for a more comprehensive list and make the jump for the official press release.

[Source: KBB]

Continue reading Toyota tops Kelley Blue Book best resale value awards

Toyota tops Kelley Blue Book best resale value awards originally appeared on Autoblog on Thu, 03 Dec 2009 07:58:00 EST. Please see our terms for use of feeds.

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Remember that whole 'bankruptcy will kill GM and Chrysler residuals?' Not so much.

Chris Shunk — Tue, 14 Jul 2009 14:30:00 EST

Filed under: Car Buying, Chrysler, GM, Earnings/Financials

Back in late 2008, auto executives from General Motors and Chrysler warned of dire consequences in the event that one of their companies was forced into bankruptcy proceedings. With the help of the federal government, little of that doom and gloom materialized, at least when it comes to used car residuals.

Back in May, Automotive Lease Guide used impending bankruptcy as reason to slash the 36 month residuals of all Chrysler-branded products by a substantial 6% off the original retail price. That dropped the residual value of a Chrysler vehicle to an average of 28.8%, while Dodge and Jeep were at 31.3% and 32.5%, respectively.

Just one month later, with Chrysler's bankruptcy in the rearview mirror, and residuals are nearly back at April levels. Chrysler has climbed nearly four points to 32.5%, Dodge is at 34.8%, and Jeep is now at 37.4%. ALM admits that bankruptcy didn't effect residual values like the company thought it would, and as a result, resale values for GM-branded vehicles won't be downwardly adjusted.

Kelly Blue Book reportedly told Automotive News that some of the bounce-back in residuals is due to the fact that relatively low gas prices are making used trucks and SUVs a bit more appealing to customers. With new car sales in the tank, we suspect used vehicles have been in higher demand as well, helping to boost up residuals.

[Source: Automotive News, sub. req'd]

Remember that whole 'bankruptcy will kill GM and Chrysler residuals?' Not so much. originally appeared on Autoblog on Tue, 14 Jul 2009 14:30:00 EST. Please see our terms for use of feeds.

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Toyota's residual values seen falling more than competitors

Sam Abuelsamid — Mon, 16 Mar 2009 11:26:00 EST

Filed under: Car Buying, Trends, Toyota, Earnings/Financials

One of the strongest selling points that Japanese brand vehicles like Toyota and Honda have had going for them over the past decade or two has been the stronger resale values that have resulted from perceived higher quality. While increased depreciation doesn't matter much to people who buy their vehicles and keep them for more than a few years, it does hurt manufacturers. In recent years, a large portion of those pricey trucks and SUVs have been leased, where the monthly payments are largely based on the vehicle's expected residual value at the end of the term. When that residual is lower than expected, the automaker's financing arm loses money - a phenomenon that has been a particularly painful reality for Detroit's automakers.

Now, like the rest of the industry, Toyota is starting to get hit by falling residuals on both cars and trucks. Some of that is surely due to the general market conditions right now, but some critics suggest that the fact that Toyota's residuals are falling faster than other companies could point to growing awareness of quality issues. At the end of 2008, an average three-year-old Toyota was worth 46.5% of its original value compared to 50.5% two years earlier. Like other brands, Toyota's trucks have been especially hard hit, dropping from over 60% to just 45.4%. In particular, Tundra residuals are on a big downturn, nosediving to 40.1% from 59.5% just one year earlier. Despite the drop, the Tundra's resale value remains higher than Chevrolet's Silverado (39.8%, down from 49.6%) and Ford's F-150 (32.2%, down from 45.6%), so while all is not lost, the race for residual supremacy is getting tighter. Thanks for the tip, Leonard!

[Source: Automotive News - sub req'd]

Toyota's residual values seen falling more than competitors originally appeared on Autoblog on Mon, 16 Mar 2009 11:26:00 EST. Please see our terms for use of feeds.

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Maybach leads luxury segment... in depreciation

Noah Joseph — Tue, 03 Feb 2009 15:31:00 EST

Filed under: Car Buying, BMW, Maybach, Mercedes-Benz, Rolls-Royce

Anybody want to buy a used Maybach? Hello? The idea may sound entirely preposterous - an anathema, even, to the brand's nouveau riche market - but it may be the best way to get your hands on Mercedes' super-lux big brother. Of course that's the positive way to look at it, but the flip side is that, as demonstrated by recently released statistics, Maybach has the highest depreciation rates of any car on the market.

Over the course of the first year of ownership, a new Maybach 62S is assessed to lose a whopping $183k off its half-a-million-dollar sticker price. That's 39% off its purchase value in the span of a year, or roughly $500 every day. The Rolls-Royce Phantom, by comparison, loses "only" about $100k, or 24%. Slightly further down-market, things are even worse... by percentage, at least: a BMW 7 Series loses a tear-jerking 51%, and a Mercedes S-Class 47%. While depreciation is expected on a new car, this is bordering on depressing.

[Source: Automotive News Europe - Sub. Req.]

Maybach leads luxury segment... in depreciation originally appeared on Autoblog on Tue, 03 Feb 2009 15:31:00 EST. Please see our terms for use of feeds.

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Big Surprise: Honda and Acura have best residual values

Chris Shunk — Fri, 21 Nov 2008 15:34:00 EST

Filed under: Car Buying, Acura, Honda

The residual value of a car or truck can be a tricky proposition. The age, mileage, general condition and segment of of the vehicle makes a big difference in determining its value, and so does its brand. If you want a car with strong residual value, it wouldn't hurt to buy a Honda, as the Japanese automaker has won it's sixth consecutive Automotive Lease Guide residual award. Honda's Acura division joined its less expensive sibling for the first time by taking the top spot for luxury vehicles, too, making it a clean sweep for team H-badge.

Toyota finished fourth overall in the voting, but the Japanese Juggernaut managed to win the most overall segment awards. Subaru has to be very pleased with its second place overall finish in residual values. Ford's F-150 scored big with the best residuals in the light pickup truck market. Japanese automakers won 11 of the 18 overall segment awards, while U.S. automakers won or shared three segments. Hit the jump to view all the segment leaders in the ALG residuals listing.

[Source: Automotive Lease Guide]

Continue reading Big Surprise: Honda and Acura have best residual values

Big Surprise: Honda and Acura have best residual values originally appeared on Autoblog on Fri, 21 Nov 2008 15:34:00 EST. Please see our terms for use of feeds.

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Industry in trouble when Toyota writes down leases

Chris Shunk — Thu, 07 Aug 2008 10:00:00 EST

Filed under: Toyota, Earnings/Financials

Due to a miserable U.S. car market, Detroit automakers are losing billions from lower than expected residuals on leased vehicles. Since the residuals on Motown metal are traditionally below that of the Japanese competition, many industry insiders thought that Toyotas in this country world were immune to the trend. It appears that's not the case. Toyota announced it had to "set aside major reserves for its first quarter to cover losses from vehicle leases in the U.S."

The problem is predictably bad with trucks and SUVs, but other products aren't selling off lease as well as they have in the past. With residuals dropping, used cars are dirt cheap. That gives prospective buyers an affordable alternative to buying a new car. That's bad news for Toyota, but it may even be worse news for everyone else.

Toyota has been making money and gaining market share during these tough times, but even the automotive juggernaut is struggling in today's difficult economic conditions. Including Lexus, Toyota's Daily Sales Rate is down for seven straight months versus prior year numbers, with July missing the mark by 18.7%. This news proves that even Toyota has its share of problems, but what it really shows is that Chrysler may have been on to something when it stopped offering leases.

[Source: BloggingStocks]

Industry in trouble when Toyota writes down leases originally appeared on Autoblog on Thu, 07 Aug 2008 10:00:00 EST. Please see our terms for use of feeds.

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Cost of owning a car crests $1/mile on some models

Chris Shunk — Sat, 08 Dec 2007 09:27:00 EST

Filed under: Car Buying, Budget, Sedan, SUV, Truck, Etc., Cadillac, Chevrolet, Ford, Lexus, Toyota

We've all seen the ads in the newspaper or in commercials that say you can get a new car with zero money down and only $299 per month. Quick math tells you that even after taxes and destination, you're only paying about $4,400 the first year to own a brand new car. A recent study by consulting firm Runzheimer International shows that a new car will cost you considerably more in overall operating costs. At 15,000 miles per year, the cost of insurance, gasoline, fees, depreciation, and maintenance can drive the overall cost near $20,000 per year.

The 2008 Cadillac STS was tops in this year's test, costing buyers $19,537. The Lexus LS460 was close behind at $19,372. Big vehicles cost quite a bit also, with Ford's E-350 XL SuperDuty tallying a $16,543 bill followed by the Chevy Tahoe LS 4x4 at $15,789. There were some relatively low cost vehicles as well, with the first year costs of a Toyota Corolla CE coming in lowest in the test at $7,933 and a Ford Ranger XL pickup that hits $9,929. If these numbers seem high, it's because the highest liability in a new car balance sheet is depreciation, and new cars can lose thousands the day they're driven off the lot. Every mile on the odometer brings the resale value lower, and if your new car carried lots of incentives or it's a rental car favorite, its residual plummets even further.

[Source: The Car Connection]

Cost of owning a car crests $1/mile on some models originally appeared on Autoblog on Sat, 08 Dec 2007 09:27:00 EST. Please see our terms for use of feeds.

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Yo Quiero Research Integrity: Kelley Blue Book partners with Taco Bell to talk residuals

Chris Paukert — Sat, 25 Feb 2006 14:00:00 EST

Filed under: Car Buying

Here's an odd one of dubious merit: Kelley Blue Book's marketing research division has partnered with Taco Bell under the guise of studying the effects of in-car eating on vehicle residuals. Yes, that probably bears re-reading.

The car valuation guide experts have teamed up with fast food's Gordita gurus on the thinnest wisp of a study-- to determine the depreciation costs that sloppy 'dashboard dining' has on a vehicle's resale value.

Their findings? According to a KBB official, "Our research highlights a huge misperception among consumers: that the interior condition of a car has less importance than the exterior in terms of residual value." Fair enough. But the fact that the press release then goes on to praise "Innovative companies like Taco Bell" for "...creating solutions for diners on the go with mess-free products like the Crunchwrap Supreme[TM]" sort of takes the intellectual sheen off this one, doesn't it?

Besides, crediting Taco Bell with creating "mess-free products" is a remarkable example of selective retention. After all, there's nothing tidy about a Chalupa, kids. Not before, not during, and certainly not after.

(Thanks to Nick @ Slashfood for the tip)

[Source: KBB.com]

Yo Quiero Research Integrity: Kelley Blue Book partners with Taco Bell to talk residuals originally appeared on Autoblog on Sat, 25 Feb 2006 14:00:00 EST. Please see our terms for use of feeds.

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