On average, a new car sold in 2020 will retain 36% of its original value after five years and 75,000 miles. Put another way, the vehicle you spend $35,000 on this year will be worth about $13,000 in 2025. That’s alarming, especially considering transaction prices have a tendency to rise over time. As motorists spend more on a car, they’re setting themselves up to lose more when they sell it or when they return it to the dealership they leased it from.
Kelley Blue Book (KBB) put together a list of the new 2020 models projected to hold at least 50% of their value in 2025. Unsurprisingly, the top five spots are occupied by tough, go-anywhere trucks built for durability.
Right-sized and well-built, the Toyota Tacoma has occupied the top spot in KBB’s resale value rankings since 2014. It carries a base price of $26,050, and it’s expected to retain 60.6% of its value over a five-year period. Toyota recently updated its smallest and most popular truck with a new look and more tech, including Android Auto.
SUVs and pickups are the industry’s resale value champions, so no one should be surprised to see the Jeep Gladiator in second place. It’s an SUV (the Wrangler) turned into a go-anywhere, adventure-ready pickup. Exclusively offered with four doors, it carries a base price of $33,545, and KBB predicts it will retain 58% of its original value in 2025.
Anyone who has ever shopped for a used Jeep Wrangler, even one that’s well over a decade old, will know firsthand how well it holds its value. Cheap examples are almost unheard of because even the examples that have been driven into the ground are sought-after by enthusiasts who need parts or a blank slate on which to build a rock crawler. KBB singles out the four-door Unlimited as the model that holds its value best. It starts at $31,795, and buyers will get 57.6% of that sum back if they sell it after owning it for five years. Wrangler owners love modifications, and the aftermarket support is huge, but keep in mind that any changes made can have a significant effect on resale value.
The two-door model is expected to retain 51% of its original value after five years. It depreciates a little bit faster than the four-door variant, partly because it’s not as popular, but it’s still well above the industry average.
Toyota’s full-size Tundra pickup has been around since 2006, so it’s much older than its main competitors, yet it holds more of its value than best-selling trucks like the Ford F-150 and the Chevrolet Silverado 1500. Pricing starts at $33,575, and owners should get 57.2% of their original investment back if they sell it after five years. Second place in the segment goes to the aforementioned Silverado and its GMC-badged twin, the Sierra 1500. Both keep 52.7% of their value after five years.
Although the body-on-frame Toyota 4Runner is not the newest car in its segment, it remains sought-after even as it ages because its main qualities (off-road prowess, durability, reliability, and roominess) are timeless. It’s closely related to the Tacoma under the sheet metal, so it’s more capable off the beaten path than a vast majority of the SUVs in its price range. It starts at $36,120, and KBB predicts it will keep 56.1% of its value over a five-year period.
What about electric vehicles?
Broadly speaking, electric vehicles depreciate faster than the industry average. One exception to the rule is the Tesla Model X, which leads the chart by retaining 44% of its value after five years. The Model 3 — which is the best-selling electric car in the United States — and the Model S will retain 36.5% and 31.3% of their purchase price, respectively.
Website iSeeCars conducted a similar study and found the Nissan Leaf and the BMW i3 both keep about 29% of their value after five years. For context, the car with the worst depreciation is the Maserati Quattroporte, which is expected to be worth 28.2% of the original purchase price after five years. BMW’s 7 Series is in second place with a 28.7% score, so it’s nearly on par with the Leaf and the i3. It takes half a decade for these cars to lose approximately 70% of their original value. That’s a sobering statistic, and one to factor into your decision when shopping for a car if you plan on owning it (instead of leasing it) and if you think you’ll keep it for a while. It’s your money that’s at stake.
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