BOSTON (MainStreet) Sport utility vehicles and pickup trucks depreciate more slowly than passenger cars and here's a look at five 2014 SUVs and trucks that seem likely to lose their value the slowest of them all.
"Whether a vehicle retains its value well really comes down to basic economics: the balance between supply and demand," says Eric Ibara of Kelley Blue Book, which recently honored some two dozen 2014 cars, trucks and SUVs with the firm's 12th annual Best Resale Value Awards.
KBB believes the winning models will depreciate the least over the next five years of any offering in each vehicle's respective class.
That's good news for people who buy the winning rides, as depreciation is one of the biggest "expenses" car owners face. For example, KBB predicts that the average 2014 will lose 60.3% of its original value to depreciation by 2019.
But the firm recently analyzed millions of used-vehicle sales to identify those models that seem likely to depreciate far less. Judges added their picks for low-depreciation 2014s based on each model's appearance, performance, features and popularity with consumers.
Ibara says vehicle shoppers worried about depreciation might start by steering clear of passenger cars and focusing on SUVs or trucks instead; KBB predicts that the average 2014 SUV or truck's value will decline by 58.3% over five year, whereas the typical 2014 sedan or hatchback will lose 62.2%.
That might not seem like such a big difference, but it translates into nearly $2,000 if you buy a $50,000 SUV or truck this year instead of a $50,000 passenger car.
Ibara says SUVs hang onto their value better because they're harder to come by in the resale market. "There are just more cars out there," he says.
As for trucks, the expert believes pickups tend to retain more of their value partly due to customer loyalty. "Truck buyers tend to be very loyal to their chosen brand," Ibara says.