#depreciation

Buying a new car instead of purchasing a used one is almost justified, if one takes a close look at the numbers.

Not to hammer too obvious a point here, but the decreasing popularity of a certain car model, combined with increasing incentivization, can seriously influence that model’s depreciation. Ask Cadillac about that. While a boon for savvy used car buyers a few years down the road, it doesn’t help anyone’s lease payment and can leave you upside down on a long-term loan.

In its annual Your Driving Costs study, the American Automobile Association broke down the average vehicle, fuel, insurance, maintenance, loan interest, and depreciation costs of various vehicle segments to show what a hypothetical new car buyer can expect to pay, annually, over the course of a five-year loan.

Naturally, your overall bill’s going to be lower with a smaller, cheaper, thriftier vehicle. That said, after looking at the findings of last year’s study, cars in certain segments are shedding their value at a growing clip. And you’ll pay for that.

Unlike other vehicles in the Fiat Chrysler lineup, and we could list off a number of them, Jeep’s Wrangler line has a near supernatural ability to hold on to its value. Does worrying about depreciation keep you up at night? Forget that compact sedan and shell out a little more for a Wrangler.

For non-buyers, however, the leases offered by Jeep on both the 2018 JK Wrangler Unlimited and next-generation 2018 JL Wrangler Unlimited present both an opportunity and a mystery. Strangely, the cost of leasing an all-new Wrangler amounts to one dollar a month less than the cost of leasing the old Wrangler. What gives?

Autumn is here, leaves are falling, and dealers are marking down remaining 2016 inventory to free up room for models that won’t sound old in three months.

It’s a good time to hunt for that smoking deal on the 2016 vehicle of your dreams, but if your dreams — and bank balance — fail to reach that goal, looking back another model year could save you a lot of money.

New car looks and a low entry price can be yours if you’re willing to live with a vehicle boasting limited appeal and awful resale value. These are your best bets.

One- to three-year-old-vehicles are pouring back onto dealer lots, but the predicted drop in used vehicle prices hasn’t happened yet.

Consumer choices (meaning: trucks, trucks, trucks) and the high value of returning vehicles are keeping used prices near record levels, but analysts still expect a drop later this year, Automotive News reports.

Owners of orange or yellow cars should consider themselves blessed, especially if they’re planning on selling.

A study of 1.6 million three-year-old vehicles by iSeeCars.com reveals that a vehicle’s paint color has a big effect on depreciation and the amount of time it takes to sell.

Electrified transportation isn’t catching fire in the new vehicle market, but sales are positively scorching at used car lots.

The top three fastest-selling one- to three-year-old vehicles in the U.S. today aren’t pickups or SUVs, but a low-volume plug-in hybrid and two EVs, according to automotive data and research company iSeeCars.com.

Stephen writes:

Hi Sajeev,

I’ve toyed with the idea of turbocharging a 2.sl0w just for giggles and TORQUE, but the quest has to make some sense economically, or else the finance minister will not approve. Then it hit me: just how LOW in price have those older dirty diesels gone, anyway? You know, the ones with that lovely 236 pounds-feet of torque.

In other words, can I just get the torque without the spending abyss and busting my knuckles? Small data-set wise, four-cylinder manual Jettas with 64,000 miles average a diesel premium of only $675. At that consideration point, say 2010-ish Jetta, there is no economy for the project and I could jump right into the lovely torque.

So my question to you, on behalf of Torque Lovers Everywhere: is it time to pounce on diesel?

I wish I had $100 for every time someone told me their rare car was going to shoot up in value. If I did, I would invest it in the stock market, which is something that actually might shoot up in value. Their rare car, of course, will stay behind, largely due to the old adage that just because something’s rare doesn’t mean it’s valuable.

I remember the first time someone told me their car was rare and so it would increase in value. I was in high school, and a classmate of mine had just bought a Jeep Liberty Freedom Edition, or some such bizarre Jeep special edition where they change the wheels and add two-tone seats in an attempt to get people to buy it.

I promised more 21st-century Junkyard Finds recently, so here’s a high-end Volvo with turbo boost rivaled only by its turbocharged depreciation levels. Yes, it’s the Volvo S80, complete with twin-turbo 286hp tranverse-mount straight-six.

4 a.m.

The alarms clocks ring. Both of them. Just in case I get any funny ideas.

I go through the semi-conscious motions. Clothes… suitcase… glasses… coffee… breakfast. By 4:15 a.m, I’m out the door and driving to the airport in a 21-year-old Geo Prizm. I figured that a 5-speed and a stark lack of noise insulation will keep me alert. Thanks to Atlanta’s penchant for using steel plates to cover up every possible pothole on the road, I am not disappointed.

I see so many stunningly depreciated German luxury cars in pretty nice condition at the cheap self-service wrecking yards that they don’t register in my consciousness much more than your typical Sebring or Sephia. These days, though, I’m making an effort to notice such cars, since it seems that many of you thought this big V12-powered BMW was interesting.

I was headed over to the Denver U-Pull-&-Pay last week, in search of some bits for my ’41 Plymouth project, and I resolved to find and photograph a high-end Audi. Sure enough, here’s this clean A8, not as new as I’d like, but still an excellent example of what happens to such cars soon after they get into the hands of their third or fourth owners.

N.C. writes:

Sajeev,

We have 5 cars and 4 drivers. My wife and I drive the three oldest vehicles: 2003 LS430, 2005 Z4, and 2000 Frontier. My question is regarding collision insurance on the Lexus and the BMW. I currently carry full coverage on both and am considering dropping collision coverage to save money.

TTAC Commentator Nick 2012 writes:

Archangel of the Panther Platform –

A nice looking 2005 LWB Lincoln Town Car with only 107,000mi popped up for sale at a nearby dealer with a what-I-hope-to-be-optimistic $8,000 asking price. As any follower of the good book of fat Panther Love(tm), I keep my eye out for a good one on the local boards.

I took a new position a while back that has me commuting about 65mi a day – about 90% interstate. Going from my comfortable, competent Accord to the extremely comfortable TC would cost me about $10/week in increased fuel costs if I exclusively used the TC (which I wouldn’t do).