Table of Contents
- What is depreciation—and why does it matter?
- Cars with the highest and fastest depreciation rates
- Tips for limiting depreciation
- Finding affordable new car insurance
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Car ownership has many advantages, including flexibility, freedom, and convenience. But many cars also have high enough depreciation rates to scare you off the lot! Fortunately, there are ways to gauge depreciation and reduce its impacts.
car insuranceexpert and
trusted comparison tool, is here with the lowdown on depreciation. In this guide, we’ll explain what depreciation is and which eight cars have the highest depreciation estimates. Plus, keep reading for tips on limiting depreciation and finding better-priced car insurance no matter which car you drive.
What is depreciation—and why does it matter?
Car depreciation refers to the rate at which a car loses value over time. In simple terms, the clock begins ticking the moment you drive off the lot. There are also several factors that can accelerate a vehicle’s depreciation.
Here are a few of the most significant factors influencing vehicle depreciation:
- Vehicle make and model: SUVs and sports cars typically have lower depreciation rates, while luxury sedans and electric vehicles generally lose value more quickly
- Mileage: The more miles a car has on it, the higher its depreciation rate
- Condition: A vehicle that looks and/or is in poor shape will lose more value than a car in brand-new or like-new condition
When buying a new vehicle it’s important to consider these factors, as they will significantly impact your vehicle’s
trade-inor selling value. You can reduce the impacts of depreciation by finding cars with a high resale value and avoiding those that quickly depreciate. Luckily, we’ll give you a head start on your search for cars with high depreciation rates.
Cars with the highest and fastest depreciation rates
1. Mercedes Benz E-Class
Starting MSRP: $54,950
Average 1-year depreciation: 15%
Average 5-year depreciation: 69%
When bought new, a
Mercedes-BenzE-Class can lose 69% of its value within the first five years, not to mention at least 15% within its first year. If you decide to buy one of these luxury mid-sized sedans, prepare to lose $37,915 of your original investment.
2. Nissan Leaf
Starting MSRP: $27,400
Average 1-year depreciation: 13%
Average 5-year depreciation: 65.1%
3. BMW 7 Series
Starting MSRP: $86,800
Average 1-year depreciation: 19%
Average 5-year depreciation: 61.5%
BMW 7 Seriesis classified as a luxury vehicle—but while you may have the top technology for the first minute you’re driving off the lot, many other brand-spanking-new luxury vehicles are waiting in the wings. That means by its first birthday (let alone its fifth) the 7 Series is essentially old news and undesirable, so the price drops to entice more buyers.
4. Maserati Ghibli
Starting MSRP: $76,200
Average 1-year depreciation: 11%
Average 5-year depreciation: 61.3%
One of the biggest reasons for the Maserati Ghibli’s hard and fast depreciation is competition. While the Italian exotic turns heads, not much is known about itsreliability, and demand remains low. In short, if you want to retain some value on your luxury vehicle purchase, a
Maserati Ghibliis not in the cards.
5. Audi A6
Starting MSRP: $55,900
Average 1-year depreciation: 12%
Average 5-year depreciation: 58.2%
One reason for the A6’s ever-burgeoning depreciation is that it tends to be leased. Rather than outright purchases, this particular model is returned en masse to the dealerships. Consequently, as the Audi A6 floods the used luxury market, its value markedly decreases.
6. Volvo S60
Starting MSRP: $39,250
Average 1-year depreciation: 17%
Average 5-year depreciation: 57.3%
Volvomay be a leader in safety but it’s not a leader in resale value. This is due in large part to its status as a European luxury sedan—a class of vehicles that have been falling out of fashion as electric vehicles and SUVs become more favorable.
Repairs are expensive and parts are hard to come by—and when you finally do find the part(s) you need, it will cost you. If you don’t want to slowly pour thousands of dollars into maintenance only to lose more money at resale, steer clear of the Volvo S60.
Volvo resale value
7. BMW X3
Starting MSRP: $43,700
Average 1-year depreciation: 4%
Average 5-year depreciation: 66.5%
Despite the increasing popularity of SUVs and excellent safety and reliability scores, the
BMW X3also has extremely high maintenance costs. Although the X3 has a pretty average depreciation at first, it won’t be long before its value takes a nosedive.
The subcompact luxury vehicle has one of the worst resale values out of all SUVs. You could, of course, use this to your advantage and
consider buying used—just brace yourself for the inevitably costly upkeep.
8. Jaguar XF
Starting MSRP: $45,300
Average 1-year depreciation: 12%
Average 5-year depreciation: 59.5%
Jaguar makes some of the most satisfying and smooth cars to drive, but they also tend to have a reputation for being not so reliable. The
Jaguar XFis a performance luxury car, so specialty parts are expensive. Quality and longevity issues paired with low sales keep the XF from holding any real value.
Tips for limiting depreciation
No matter what car you drive off the dealership lot, there are a few things you can do to minimize depreciation. Check out our quick guide:
- Consider used cars: As you’ve learned, some cars can lose value quickly. If you don’t need a brand-new car, buying used is a great way to have the bulk of the depreciation paid off for you.
- Maintain your car: Stick to your manufacturer's recommendedcar maintenance schedule. That way, you’ll get the best return when it’s time to sell.
- Drive your car for as long as possible: Depreciation only impacts you when you sell so if you can hold onto it after it’s lost most of its value, it will sting much less. Plus, this will give you plenty of time to plan your next vehicle purchase.
- Buy a high-resale model: Some cars simply retain value better than others. Research resale values before you buy so you know which models will give you a higher return.
- Sell privately: The more you earn from selling your car, the less you lose in depreciation. You will have more control over the sales process, which could mean you get more out of aprivate sale over a trade-in.
- Look into tax breaks: If you drive your car for work, you might be able to claim it on your income taxes.
Finding affordable new car insurance
Being a new car owner can be financially taxing. Aside from sticker price, maintenance, and repair costs, you’ll also need to purchase
car insurance. Fortunately, you can keep your new car insurance rate low by using the Jerry app.
The sign-up process only takes 45 seconds with a few quick and easy questions.
Jerrywill use your answers to compare quotes from more than 55 leading insurance companies and forward you the best ones. Select the rate that works for you and let Jerry handle the rest—no paperwork, phone calls, or research required. Just sit back and watch the savings roll in! The average user saves more than $800 each year on car insurance.
“WOW.Jerryhas been so easy to use. I called a representative when I wanted some clarification, and they walked me through the entire process of finding a new rate for full coverage on my luxury vehicle.” —Beth G.
Thousands of customers saved on average $887/year on their car insurance with Jerry
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What car has the highest depreciation after five years?
Luxury sedans and electric vehicles have some of the highest depreciation rates over time—but the Mercedes Benz E-Class tops our list at a whopping 69% depreciation rate.
What car has the highest depreciation after one year?
The BMW 7 Series has the highest depreciation after one year, racking up an average 19% depreciation rate.