Author Topic: Feature: The most reliable cars that depreciate the least  (Read 8616 times)

Offline Autos_Editor

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Feature: The most reliable cars that depreciate the least
« on: February 24, 2012, 04:02:40 am »


Which are the most reliable vehicles with the best resale values?  We cross-referenced some recent surveys to find out.

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Offline sailor723

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Re: Feature: The most reliable cars that depreciate the least
« Reply #1 on: February 24, 2012, 07:25:40 am »
While it's nice to know the top vehicle in each catagory this article would have been far more useful if it had listed either rankings of all vehicles based on this criteria or a list of vehicles scoring below industry average.
So, why can't the Germans make electronics work in cars?

Offline nlm

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Re: Feature: The most reliable cars that depreciate the least
« Reply #2 on: February 24, 2012, 08:25:30 am »
Interesting research.

Offline SaskSpecV

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Re: Feature: The most reliable cars that depreciate the least
« Reply #3 on: February 24, 2012, 11:56:05 am »
Interesting article for sure.  I'm not surprised at the "discrepancy" in the results, as the testing methodologies are so different.  Personally, I'm getting tired of the "true cost of ownserhip" metric.  These agencies cannot assess for local differences in insurance prices that may vary significantly by jurisdiction (for example, here in SK it is > $200 a year more to insure a Honda Fit than a Chevy Sonic...yet apparently in the USA Fits are very cheap in insure).  More importantly, they continually cite depreciation as the largest factor in differing costs of ownership, and rightfully so - if you only keep the vehicle for 3 - 5 years.  In the past this may have been generally the norm, but far more buyers today are keeping their vehicles for longer (average 6 years, in the US at least):

 http://www.kbb.com/car-news/all-the-latest/average-length-of-us-vehicle-ownership-hit-an-all_time-high/

And for those who "run it into the ground", depreciation is virtually identical for all cars (nearly 100% of the purchase price), and therefore not a factor for differentiating ownership costs between various models.  OTOH, reliability and maintainence costs are far more variable between models over a longer time span and thus a more important metric for differentiating total ownership costs. 

I guess the problem with "long term ownership" studies is that - much like the stock market - previous returns (reliability) is no guarantee of future results.  A study on the reliability of a 10 year Ford Focus is not necessarily going to be predictive of the reliability of a 2012 Focus in the year 2022. 

Offline Sir Osis of Liver

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Re: Feature: The most reliable cars that depreciate the least
« Reply #4 on: February 24, 2012, 01:56:35 pm »
 :iagree: They also typically miss the difference between actual purchase price and MSRP when figuring out depreciation.
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Offline aaronk

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Re: Feature: The most reliable cars that depreciate the least
« Reply #5 on: February 24, 2012, 02:12:04 pm »
I thought that said "Dodge Caliber" at first, I had to look twice and that's when I noticed "Challenger"...that makes more sense!  :)

Offline airbalancer

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Re: Feature: The most reliable cars that depreciate the least
« Reply #6 on: February 24, 2012, 02:21:41 pm »
I am surprised that the prius is not on the list
I wonder if gas is $2 / l, will I be able to get listed price for it ?  ;D

Offline spidey

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Re: Feature: The most reliable cars that depreciate the least
« Reply #7 on: February 24, 2012, 03:59:49 pm »
I dont think depreciation matters as much anymore as people seem to be keeping their cars longer.  I myself have never looked at that, although Ive only ever bought one car brand new.  But I keep my vehciles for 8-10 years or more if nothing is wrong with them

Offline Cord

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Re: Feature: The most reliable cars that depreciate the least
« Reply #8 on: February 24, 2012, 07:03:02 pm »
:iagree: They also typically miss the difference between actual purchase price and MSRP when figuring out depreciation.

Bingo! I've beat that dead horse for a while around here. The consensus seems to be that people prefer an easy to use benchmark even if it"s wildly inaccurate.

Offline Solstice2006

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Re: Feature: The most reliable cars that depreciate the least
« Reply #9 on: February 24, 2012, 09:03:13 pm »
Good Article, little more geared to people who buy cars new, and replace them after 3-5 years.  Maybe we can get another article, "Reliable Vehicles That Depreciate Quickly" for people like us who buy cars 1-2 years old, and drive them for another 6-8.  I have a feeling the new Buick LaCrosse would be up there, the Lincoln MKZ, Ford Taurus, Mazda6, Ford Flex, the current generation Ford Fusion, because the new one looks cooler.

Offline tinnemeneer

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Re: Feature: The most reliable cars that depreciate the least
« Reply #10 on: February 28, 2012, 03:19:41 am »
<div style="text-align:left">

Which are the most reliable vehicles with the best resale values?  We cross-referenced some recent surveys to find out.

<a href=http://www.autos.ca/auto-articles/feature-the-most-reliable-cars-that-depreciate-the-least>Read More...</a></div>

Being a second hand car owner I'm much more interested in most-reliable-cars-that-depreciate-the-fastest. :)

At this moment I'm driving a 8 year old BMW 645 cabriolet (I bought it last march) which cost about a quarter of the price the first owner paid for it. Of course my bills on maintenance will be higher but that will never be in the same price range of the depreciating of the first 7 years.
Even better; my car depreciates slower than new, not nearly as much fun, cars which would cost the same new (say a Volkswagen Golf in a luxury trim).


Offline hemusbull

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Re: Feature: The most reliable cars that depreciate the least
« Reply #11 on: February 28, 2012, 08:13:18 am »
Very good data which is the same unusefull set of numbers as government gas mileage data. Nothing is compatable with the real life numbers, just a big game to disorient the customer and make all cars comparably equal with unpredictabe cost after several down the road. Everything as a total is absolutely confusing and the best recipe for ordinary buyer is: do not read!

Offline tazcubed

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Re: Feature: The most reliable cars that depreciate the least
« Reply #12 on: December 27, 2012, 12:27:30 pm »
I dont think depreciation matters as much anymore as people seem to be keeping their cars longer.  I myself have never looked at that, although Ive only ever bought one car brand new.  But I keep my vehciles for 8-10 years or more if nothing is wrong with them
Agreed - if they actually extracted the data for 8-10 year old cars, the list would change dramatically. BMWs tend to drop significantly after 4 years, as do other luxury cars drop once the warranty runs out. Once the TCO is figured into longer/older running cars, the balance tends to lean towards the truly better built and less problematic cars.

Offline DKaz

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Re: Feature: The most reliable cars that depreciate the least
« Reply #13 on: December 27, 2012, 12:56:47 pm »
Didn't someone here say that the younger generation seems to be content having a car payment for the rest of their lives?

<---- Guilty.

I would've paid off my Corolla 8 months ago... but I would've still been in that darn Corolla.
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Offline Northernridge

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Re: Feature: The most reliable cars that depreciate the least
« Reply #14 on: December 27, 2012, 02:24:08 pm »
Didn't someone here say that the younger generation seems to be content having a car payment for the rest of their lives?

<---- Guilty.

I would've paid off my Corolla 8 months ago... but I would've still been in that darn Corolla.

All generations. It's just a fixed part of cash flow and people figure out how much they can afford...like a cel phone bill or internet access.  No biggie.

Same applies to people who pay cash for their cars. They've just concentrated their payments into one lump sum instead of spreading them out. In fact what they've really done is prepaid all the car payments for however long they've been saving to buy the car...think about that...say it takes you 5 years to save up enough money to pay cash for a new car. So you lived without for 5 years even though you've been paying for it (into savings). Then you pay cash and feel good about yourself but all you've really done is prepaid for the car. Meanwhile someone else took out a loan for the same car, has passed the financing risk to the bank and gets to enjoy the vehicle in advance of it being paid for.
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Offline PJ

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Re: Feature: The most reliable cars that depreciate the least
« Reply #15 on: December 27, 2012, 02:47:05 pm »
Didn't someone here say that the younger generation seems to be content having a car payment for the rest of their lives?

<---- Guilty.

I would've paid off my Corolla 8 months ago... but I would've still been in that darn Corolla.

All generations. It's just a fixed part of cash flow and people figure out how much they can afford...like a cel phone bill or internet access.  No biggie.

Same applies to people who pay cash for their cars. They've just concentrated their payments into one lump sum instead of spreading them out. In fact what they've really done is prepaid all the car payments for however long they've been saving to buy the car...think about that...say it takes you 5 years to save up enough money to pay cash for a new car. So you lived without for 5 years even though you've been paying for it (into savings). Then you pay cash and feel good about yourself but all you've really done is prepaid for the car. Meanwhile someone else took out a loan for the same car, has passed the financing risk to the bank and gets to enjoy the vehicle in advance of it being paid for.

I don't agree.  While I see the enjoyment of getting a new car right away it's much better to save the money in advance rather then pay it later.

First it's cheaper.  Even zero percent financing is not zero.  There are always fees and you can normally get a better price if you don't take the zero financing.

Second you are taking the financing risk, not the bank.  Lose your job while saving for a car and it's no big deal.  You even have a pile of saving to fall back on.  Lose your job while financing a car and you have a problem.

Finally people make better decisions when they have to hand over actual money then when just sign some papers.  I've known too many people who have bought cars they can't afford by getting a loan for an absurd number of months or a really unfavourable lease agreement.


Offline tpl

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Re: Feature: The most reliable cars that depreciate the least
« Reply #16 on: December 27, 2012, 03:18:52 pm »
We paid cash for our last two cars.  For no better reason that we did not wish to have any debt. Retiring or being retired with debt is a really bad idea, unless you have one of those old fashioned DB pensions with index linking and even then...

Short term car loans, say 4 years or under are a necessary part of living...same as 25 year mortgages.  It is the 7 year car loans and 35 year mortgages are the problem imho. You spend too much time underwater...which is fine if you are a federal civil servant or perhaps a doctor but far too risky for anyone else nowadays.  I know people who held the same 'safe' job for 40 years but then there were no long loans or mortgages so there was no problem.

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Offline Vanstar

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Re: Feature: The most reliable cars that depreciate the least
« Reply #17 on: December 27, 2012, 04:35:20 pm »
Didn't someone here say that the younger generation seems to be content having a car payment for the rest of their lives?

<---- Guilty.

I would've paid off my Corolla 8 months ago... but I would've still been in that darn Corolla.

All generations. It's just a fixed part of cash flow and people figure out how much they can afford...like a cel phone bill or internet access.  No biggie.

Same applies to people who pay cash for their cars. They've just concentrated their payments into one lump sum instead of spreading them out. In fact what they've really done is prepaid all the car payments for however long they've been saving to buy the car...think about that...say it takes you 5 years to save up enough money to pay cash for a new car. So you lived without for 5 years even though you've been paying for it (into savings). Then you pay cash and feel good about yourself but all you've really done is prepaid for the car. Meanwhile someone else took out a loan for the same car, has passed the financing risk to the bank and gets to enjoy the vehicle in advance of it being paid for.

Except you are not paying an interest charges; this is not insignificant over the  term of a car loan, typically five years. Even if the total interest charge is only say, $2000, that is money that can go into a TFSA or RRSP. In addition, you can earn compound interest on the money you put aside for you car, which will in effect reduce the cost of the car by at least a thousand dollars, probably even more.

True financial freedom and not being chained to what you don't want to do is all about spending wisely. People waste as a matter of course in our society. I see it every day, seriously stressed people spending way beyond their means. Heck, it would be a big surprise an outwardly "successful" person fails a credit check when I screen new tenants for my places. Yet these people still get lent money even with crappy 650 or even less credit scores. My point here is saving a few thousand over the life of a new car IS WORTH IT. It didn't cost you to save that money, quite the opposite, and the money to replace it would be taxed, meaning the real value of that $3000 is $4000 PLUS. The real key to freedom is never financing what you can pay cash for and limiting your spending to what you actually need. It's not rocket science and the freedom you get is way worth it and you'll have less stress to boot.

I also think spending cash out of your bank account is fundamentally a way of making any buyer carefully assess her/his transportation needs. We have an era of long term, low interest loans which, in effect, cushion the MSRP of the car. But believe you me, you are going to pay every cent of that car's price with interest no matter what happens or over how long. Actually taking your hard saved cash to buy something is a much different experience than signing up for a monthly payment.

Finally, I have never bought a new car for cash where I didn't get at least another 5% off for having cash on the table.
« Last Edit: December 27, 2012, 05:08:28 pm by Vanstar »
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Offline tooscoops

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Re: Feature: The most reliable cars that depreciate the least
« Reply #18 on: December 27, 2012, 04:47:58 pm »
with the cars here, unfortunately, i can't give any more money off for a cash purchase. kinda sucks. really takes away some of the incentive for a cash buyer. hell, we make a bit more on the reserve from the banks when we finance. i know most cash customers think i'm lying, but we would prefer they were financing and might be able to take a couple hundred off if they change to finance...

anyways, so do the residual "awards" or whatever go off average sale price on the year, or msrp? because if it just goes off msrp, it really doesn't mean anything when there are so many companys that put money on the hoods of the cars.
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Offline Vanstar

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Re: Feature: The most reliable cars that depreciate the least
« Reply #19 on: December 27, 2012, 05:13:59 pm »
with the cars here, unfortunately, i can't give any more money off for a cash purchase. kinda sucks. really takes away some of the incentive for a cash buyer. hell, we make a bit more on the reserve from the banks when we finance. i know most cash customers think i'm lying, but we would prefer they were financing and might be able to take a couple hundred off if they change to finance...

anyways, so do the residual "awards" or whatever go off average sale price on the year, or msrp? because if it just goes off msrp, it really doesn't mean anything when there are so many companys that put money on the hoods of the cars.

Then I wouldn't buy at your store. I'd call every one of your brand and see if they'd do it and if they did not, I would go to a brand that would.

I suppose being older is a bit of an advantage here. I realise that there are loads of cars out there and most of them are very, very good indeed so changing brand is not a big deal for me. If I can close a cash deal and take $5000 of list, I'll happily change to a Nissan from a Toyota.