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10 Vehicles That Hold Their Value

Depreciation is the biggest cost of car ownership but isn't the only factor to consider


spinner image 2016 red Honda Fit
Honda

 You probably have a commendably careful vehicle budget, but perhaps you're overlooking the single biggest cost: depreciation.

Unlike a home, which usually grows in value over time, a car, sport utility vehicle (SUV), truck or van plummets in value in just a few years. Despite what you might hear, in almost no way is a car a good investment. 

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Well, maybe if you had bought the original 1964 1/2 Mustang and still had it in showroom condition, but in normal circumstances, take some antacid when you need a replacement vehicle and begin researching what your car is worth.

"The average new car loses 49.6 percent of its value after five years of ownership,” according to the latest data from auto research firm iSeeCars.com. The three-year depreciation figure is 38.2 percent.

Overall, depreciation “remains the single biggest cost of [auto] ownership, accounting for more than a third [36 percent] of the average annual cost,” AAA's Ellen Edmonds writes.

Some models are way worse than others

Depreciation acts as an ambush, not asserting its villainy until you can't turn back. You treat yourself to a $40,000 new car and find out at trade-in time that you have a $20,000 vehicle — if you're lucky.

Well, you say, I'll show them. I'll get a nice luxury car, and that will hold its value.

Whoops.

Luxury brands sell nine of the 10 worst-depreciating models after three years. The one that isn't, a Kia K9000, is a luxury sedan, but the mainstream Kia brand isn't really what a luxury buyer wants in the long run, iSeeCars says.

Quickly depreciating vehicles

The five fastest-depreciating vehicles, a.k.a. best “lightly used bargains,” with their three-year value drop and iSeeCars’ comments:

• Acura RLX, 55.8 percent decline. Isn't a standout in the luxury market despite good overall reviews and modern safety features possibly because of lackluster handling and a lower-grade interior.

• Lincoln MKZ, 55.6 percent decline. Reliable and many standard features but might not seem as luxurious as rivals.

• Mercedes-Benz E-class, 55.4 percent decline. As with most German makes, infamous for high repair costs, but top-flight interiors, features and driving qualities.

• Jaguar XF, 54.8 percent decline. Copies the German luxury models in high upkeep costs and for enduring appeal because of its luxury look and feel.

• Cadillac XTS, 54.5 percent decline. Below-average reliability, complicated infotainment system

Because luxury models are expensive, they're often leased to keep payments lower than they would be in taking out a loan to purchase. That means you'll see a relative flood of off-lease luxury vehicles, especially luxury sedans, hitting the used market at the end of three-year leases.

Those “have to come down significantly in price to attract used car buyers,” iSeeCars’ Chief Executive Phong Ly says in the auto-price tracker's 2019 study on depreciation. The high-depreciation luxury models depreciated 1.4 to 1.5 times as much as average.

The study compared new and used prices on some 4.8 million vehicles, iSeeCars spokeswoman Julie Blackley says.

You can play the depreciation card several ways:

  • Seal a deal. Use this info to find a good bargain on a 3-year-old car among the worst-depreciating group. Yes, you have to overcome the resistance to buying something that's on a “worst” list; think of it as a list of best bargains.
  • Buy a used known quantity. You can aim for a used model in the “best” group, the ones that didn't lose as much value as they age. You'll pay more, but you'll have a more valuable vehicle to trade later, and you won't spend as much as you would on a new vehicle while still getting most of the latest safety features and electronics.
  • Go for new. If you're buying new, you can use this information to steer you toward a car, SUV, truck or van that will hold its value pretty well, punishing you less later when you buy your next vehicle.
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Vehicles usually stay on same path

Of course, vehicles depreciate differently from one another, and sudden changes can make a difference — such as a big recall or a massive remake of a model.

But overall, “depreciation tends to remain fairly constant,” Blackley says. Cars that hold their value tend to continue holding it. Those that don't, don't.

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Of course, depreciation isn't the whole picture. The Jeep Wranglers that iSeeCars lists on both its ranking of 3- and 5-year-old cars that hold their value get poor marks for reliability from Consumer Reports and didn't perform well in that publication's road tests.

Nonetheless, the Wrangler scores well in the owner-satisfaction category.

You'll see that apparent contradiction in other models in our list of 10 cars that should hold their value the most, based on what their 2016-model equivalents have done. Given what Consumer Reports and others say, you might wonder why anybody would buy these vehicles in the first place.

In other cases, it's obvious why.

Least depreciation after three years

We list the three-year depreciation that 2016 models have experienced, according to data generated for AARP from iSeeCars, which says it's fair to use that as a guide to what you'd expect if you bought the newest model of those vehicles. We also include a wider view of the newest model of the same vehicles and crash-safety test results on the newest models from the National Highway Traffic Safety Administration (NHTSA) where available.

spinner image gray Toyota Tacoma
Toyota/2012 David Dewhurst Photography

1. Toyota Tacoma

Depreciation: 21.5 percent of 2016 new-car price
Average price after three years:
 $28,246
Broader view: 
"It's primitive. The ride is stiff, and handling is ponderous,” says Consumer Reports, but Tacoma is “impressive” off road and has modern safety and connectivity features. Honda Ridgeline and Ford Ranger outscore Tacoma in the magazine's overall rankings, and both are recommended. Tacoma is not.
Safety: 
NHTSA gives it four-star crash-test ratings on front, side and rollover accidents on the agency's five-star scale.
2020 model price: 
Starting at $26,050 manufacturer's suggested retail price, according to Toyota

spinner image blue BMW M2
BMW

2. BMW M2

Depreciation: 25.1 percent
Average price after three years: 
$44,366
Broader view: 
"Razor-sharp handling and a sense of immediacy that is unlike other recent BMWs, which seem to focus more on luxury and comfort,” says Consumer Reports, ranking the BMW second in its list of sports cars behind the Porsche Boxster and ahead of the third-place Porsche 911.
Safety:
 NHTSA hasn't rated the model on crash-test performance.
2020 model price: 
Starting at $58,900, according to BMW

spinner image 2016 Subaru Crosstrek
Subaru

3. Subaru Crosstrek (tie)

Depreciation: 25.2 percent
Average price after three years: 
$20,887
Broader view:
 Consumer Reports rates it best among subcompact SUVs, calling it “an appealing option for buyers who don't need the room of an SUV but want much of the versatility,” saying it has “good fuel economy, impressive ride comfort, and feels substantial compared with its peers. Its handling is competent and enjoyable."
Safety: 
Crosstrek gets the maximum five-star overall crash-safety rating from NHTSA.
2020 model price: 
Starting at $22,145, according to Subaru

spinner image red Toyota 4Runner
Toyota

3. Toyota 4Runner (tie)

Depreciation: 25.2 percent
Average price after three years: 
$31,959
Broader view: 
Despite a top reliability score and off-road abilities, Consumer Reports places the 2020 4Runner only mid pack in overall ratings, sandwiched between Dodge Durango and Volkswagen Atlas. The publication ranks it 21st among 30 midsize SUVs — 23rd in 2019 — citing its rough-sounding engine, “clumsy” handling, “bobbing and bouncing ride,” compromised driving position because of a high step-in height and low ceiling.
Safety: 
NHTSA gives it a four-star crash-test rating overall out of a maximum of five.
2020 model price: 
Starting at $36,020, according to Toyota

spinner image 2016 red Honda Fit
Honda

5. Honda Fit

Depreciation: 25.4 percent
Average price after three years: 
$14,524
Broader view: 
First among 14 subcompacts, Consumer Reports says, noting good road test and reliability scores and citing Fit's multi-configurable seating that gives the small hatchback “versatility similar to that of a small SUV.” But the publication says the ride is stiff, the seats are uncomfortable, and the passenger compartment is loud enough that the car is “unfit for long drives."
Echoing its comments about other Hondas, the magazine says Fit's touch screen radio is “a constant frustration.”
Honda Fit is new this year to iSeeCars’ list of lowest-depreciating cars.
Safety: 
NHTSA gives the little car its highest five-star overall crash-safety rating.
2020 model price: 
Starting at $16,190, according to Honda

spinner image 2016 Jeep® Wrangler Willys Wheeler Edition
Jim Frenak

6. Jeep Wrangler, two-door

Depreciation: 27.3 percent
Average price after three years: 
$25,768
Broader view: 
The Wrangler's redesign in 2018 was a big improvement, Consumer Reports says. And even before that, the iconic Jeep model had strong owner loyalty.
That is true “despite lagging in reliability, fuel economy, comfort, and interior fit and finish,” which Consumer Reports says bedevils the Jeep brand generally. Wrangler is way down at the bottom among midsize SUVs that it has tested.
Safety: 
NHTSA hasn't rated the model on crash-test performance but says it plans to test a 2020 model.
2020 model price: 
Starting at $28,295, according to Jeep

spinner image 2016 Chevrolet Colorado Midnight Edition
Chevrolet

7. Chevrolet Colorado

Depreciation: 27.4 percent
Average price after three years: 
$25,370
Broader view: 
Responsive handling, and it features “the latest electronics including the easy-to-use infotainment system,” Consumer Reports says. The Colorado is “better-equipped than … Nissan and Toyota competitors.”
Its predicted reliability is lousy, scoring only 1 on a five-point scale. Overall, Colorado is better than only one other small pickup, the publication says.
Safety: 
Overall crash-test rating is four stars of a possible five, NHTSA says.
2020 model price: 
Starting at $21,300, according to Chevrolet

spinner image blue Jeep Wrangler unlimited
Jeep

8. Jeep Wrangler Unlimited, four-door

Depreciation: 27.6 percent
Average price after three years: 
$29,843
Broader view: 
This model is the longer-wheelbase, four-door version of the standard Wrangler. Consumer Reports groups it with the two-door model in its ratings.
But to add a fresh voice, Kelley Blue Book notes in an extended review of the Unlimited that Jeep's Uconnect infotainment system is “intuitive” and lets you position push-button controls on the screen where you wish, so the most used are handiest. The vehicle valuation and research company also applauds the array of safety features and likes the ability to change the volume of various alert bongs and chimes to tone down what you might consider too-strident warnings.
Safety: 
NHTSA gives the 2019 and 2020 Jeep Wrangler Unlimited four-door models a four-star front-crash rating out of a possible five and three stars for rollover protection. NHTSA says Wrangler's removable doors exempt it from side-crash tests, eliminating it from getting an overall crash-test rating.
2020 model price: 
Starting at $33,290, according to Jeep

spinner image white Honda HR-V
Honda

9. Honda HR-V (tie)

Depreciation: 28.2 percent
Average price after three years: 
$18,110
Broader view: 
The Honda HR-V is based on the Honda Fit subcompact, so enjoys similar multi-configurable seating that can fold to create generous cargo space. But its appeal is eroded because the HR-V is loud, its ride is stiff, the front seats aren't very supportive and it feels underpowered, according to Consumer Reports.
Reliability is predicted at four on a five-point scale, so that shouldn't be an issue.
The Honda HR-V, first manufactured for the 2016 model year, is the second vehicle new to iSeeCars’ top 10 list this year.
Safety: 
NHTSA gives it five stars, the maximum overall crash-test rating.
2020 model price:
 Starting at $22,820, according to Honda

spinner image blue Toyota Tundra
Toyota

9. Toyota Tundra (tie)

Depreciation: 28.2 percent
Average price after three years: 
$32,300
Broader view: 
It's among only a few Toyota models that “come up short,” thus likening it to the Tacoma and 4Runner, Consumer Reports says.
Tundra was updated for the 2019 model year, bringing better controls. But “Tundra still feels outclassed by newer and more refined competitors,” the publication says.
Those newer competitors don't necessarily outscore the Tundra. On Consumer Reports’ scorecard, it lands in the second spot behind the Ram 1500 among full-size pickups.
High points are predicted reliability and predicted owner satisfaction, both at four of a possible five. Drawbacks: jittery ride and a long reach to some controls.
Safety: 
NHTSA gives it an overall crash-test rating of four stars out of a possible five.
2020 model price: 
Starting at $33,425, according to Toyota

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Shop for a car with safety features you want. Buyers can get a free AARP Smart Driver course.

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