For many car buyers, sticker price and model features are the most important factors to consider when making a purchase. However, there is another important number that doesn’t appear on new-car window stickers: Resale value.
For 2011, Kelley Blue Book
(www.kbb.com), a leading provider of information on new and used vehicles, has awarded its “Best Resale Value” award to BMW. The award is based on the Kelley Blue Book Official Residual Value Guide
and is given to the vehicles that are projected to retain the highest percentage of their original price after five years of ownership.
The greatest percent of a car’s depreciation typically occurs in the first five years of ownership. An average car with average use will retain approximately 34 percent of its value. That means a car that costs $50,000 new will be worth only $17,000 after the first five years.
However, vehicles—such as those built by BMW—maintain a much higher percentage of their initial value.
“Consumers should take a good look at the projected resale value of a car when choosing their next new-vehicle purchase, and they would be wise to carefully consider the 2011 Best Resale Value Award winning vehicles and brands on this year’s list,” said James Bell, Executive Market Analyst for Kelley Blue Book’s kbb.com. “Vehicle depreciation is a new-car buyer’s biggest expense, yet many shoppers don’t realize that resale value information is available for free on Kelley Blue Book’s kbb.com.”
Options and packages don’t necessarily add to a car’s resale value. There are exceptions; a sports car resale value may be enhanced by a high-performance engine or a performance package. Geography may play a factor, too. For example, in the cold, northern part of the country, a two-wheel drive vehicle may not be worth as much as the same model with four-wheel drive or BMWs Intelligent All Wheel Drive.
The Kelley Blue Book Best Resale Value Award is used by manufacturers, banks and financial services companies, governmental agencies and the auto leasing industry. The award is based on the company’s expert projections of auction value of a car in average condition after 75,000 miles at the end of a five-year lease or term of ownership.
“Taking the time to research and choose vehicle makes, models and options wisely now can help new-car shoppers hold value down the road when they go to sell or trade-in the vehicle,” said James Bell.