Beware Decreasing Vehicle Values!
Posted on July 7, 2010
Filed Under Consumer Protection
People who buy their vehicles from Jersey City Cadillac Service should not worry too much about the depreciation of their vehicle’s value. Cadillac is a luxury brand who is known for their quality vehicle production and customer service. And VW Deals are offered continuously it seems and they are always updating and improving their vehicles, which helps retain value. The line up at Troy Honda and other nationwide Honda dealerships know that they made a solid product with a stellar reputation. So why is it then, that some vehicles have a blue book value far less than what you might think?
How a vehicle loses its value is not a consistent formula. A lot of things go in to the equation. Kelley Blue Book uses the term residual value to represent what a vehicle will be worth in the future, and then compares that to the selling price of the vehicle when it was new. A lot of value goes back to basic economics: supply and demand. The market determines what things get to keep value and what things don’t. As a consumer, you hope that your vehicle retains its value. Americans always want new, new, new. If you go to trade in your current vehicle, you might be shocked and disappointed to find out what it is worth, or what it is not worth!
Both the BMW M6 and the Land Rover Range Rover have had a 19% decline in their residual value. Keep in mind that both of these vehicles start out with an initially high price, so they have more value to lose. The BMW M6 has likely lost a lot of value as it has a base price of $102,000. People are still buying high-end sports cars, just not as much as when the economy was stronger. The Range Rover is experiencing a loss of value because engineers have not redesigned the model since 2003 and its base price is $79,000. With recent reports of consumer dissatisfaction and lack of quality vehicles, Range Rover’s value will continue to decline.
Lesson to be learned: just because you spend a lot to begin with does not mean you will get anywhere near the return on your investment!
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