why is the value dropping so fast?
#3
Join Date: Oct 2009
Location: Perth Ontario Canada
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#4
Join Date: Mar 2015
Location: Enumclaw, Washington U.S.A.
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My last two cars, a VW Touareg V8 and a Mercedes CLK 500 Cabriolet, both depreciated just as fast as I expect the Jaguar will. Luxury cars just do that.
As for why - A couple of years ago there was a psychological study that attempted to quantify the issue. The study found that the uncertainty of potential future repair costs creates fear in buyers which gets over represented in the prices they will offer. The conclusion was that buyers with more information about actual repair issues and accordingly, less unjustified fear, can get a great value in the used market. If the cars were more reliable and/or cheaper to fix, the values would hold up better.
As a practical matter, being stuck in the VW didn't bother me as much since I loved the car. I wanted out of the Mercedes for years. What a piece of crap that one was. Never again.
Thankfully, I love the Jag, so being upside down in value is no big deal. It isn't a loss until you sell it, which may be a long, long time from now on this one.
As for why - A couple of years ago there was a psychological study that attempted to quantify the issue. The study found that the uncertainty of potential future repair costs creates fear in buyers which gets over represented in the prices they will offer. The conclusion was that buyers with more information about actual repair issues and accordingly, less unjustified fear, can get a great value in the used market. If the cars were more reliable and/or cheaper to fix, the values would hold up better.
As a practical matter, being stuck in the VW didn't bother me as much since I loved the car. I wanted out of the Mercedes for years. What a piece of crap that one was. Never again.
Thankfully, I love the Jag, so being upside down in value is no big deal. It isn't a loss until you sell it, which may be a long, long time from now on this one.
#6
It is true that cars in this price bracket tend to drop like rocks. The F-Type seems to be no different than any Mercedes, Audi, or BMW I've owned, with the exception of M3s, which have always done pretty well. The 5- and 7-series cars just plummet. 911s also seem to hang in well.
However, it may come as a shock to some that the best resale value I've seen in the recent past has been with Corvettes, particularly the Z06. Corvette average depreciation is 8% per year, vs. 12-15% on almost everything else. There is a very high demand in the US for pre-owned Corvettes.
However, it may come as a shock to some that the best resale value I've seen in the recent past has been with Corvettes, particularly the Z06. Corvette average depreciation is 8% per year, vs. 12-15% on almost everything else. There is a very high demand in the US for pre-owned Corvettes.
#7
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#9
#10
It is true that cars in this price bracket tend to drop like rocks. The F-Type seems to be no different than any Mercedes, Audi, or BMW I've owned, with the exception of M3s, which have always done pretty well. The 5- and 7-series cars just plummet. 911s also seem to hang in well. However, it may come as a shock to some that the best resale value I've seen in the recent past has been with Corvettes, particularly the Z06. Corvette average depreciation is 8% per year, vs. 12-15% on almost everything else. There is a very high demand in the US for pre-owned Corvettes.
What you say doesn't surprise me because Corvettes are great value for money and cheap to maintain.
The reason ten Jag depreciates so much is because it is over priced. I think Jaguar overpriced the F Type by about 15k. I think the price of an R model should be at most $10-15k more than a comparably equipped M4. The Chassis isn't good enough to warrant more of a premium than that.
We new buyers don't care - we love the exclusivity and the looks. But a used buyer would look at the performance stats and choose the BMW unless both are closer in price.
In the absence of pricing competitively, Jaguar should restrict supply like Porsche does with the 911. The fact that there are a lot of unsold 15 F Types on the lots doesn't help.
#11
Segment/class is a large factor. In general, luxury sports cars depreciate a lot. There are a couple of notable exceptions, but as a rule luxury cars depreciate like crazy. Then factor in that it's a sports car. Two seater, not much trunk space, not very practical = niche market. Convertibles depreciate the worst (in general).
#13
If JLR is worried about values, I 100% agree. The left overs and factory incentives is a big reason of what brings prices down as dealers negotiate more and more to move older vehicles. I bought my R coupe last month at over 20% off MSRP. This is a big reason why the AMG cars depreciate so quickly.
#14
You buy a car to enjoy, not for resale value IMO. I see all high end cars depreciate fast. Less expensive cars depreciate less, but they also cost less $ to begin with. Sometimes it's just the price you pay to drive it new. I know someone who leases Mercedes AMG's, and their residual values are 50% at the end of less than 3 years.
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#15
You buy a car to enjoy, not for resale value IMO. I see all high end cars depreciate fast. Less expensive cars depreciate less, but they also cost less $ to begin with. Sometimes it's just the price you pay to drive it new. I know someone who leases Mercedes AMG's, and their residual values are 50% at the end of less than 3 years.
Ultimately, I usually buy a car and drive it until the wheels fall off. The only way I care about depreciation is if it puts a higher priced used car into my price range.
Last edited by TXJagR; 04-13-2015 at 03:11 PM.
#16
High depreciation is the reason I ALMOST bought a slightly used McLaren MP4-12C... The car was in my price range, but I opted for the new F-Type R instead.
Ultimately, I usually but a car and drive it until the wheels fall off. The only way I care about depreciation is if it puts a higher priced used car into my price range.
Ultimately, I usually but a car and drive it until the wheels fall off. The only way I care about depreciation is if it puts a higher priced used car into my price range.
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#19
Try owning a '14 Maserati Ghibli! Lessoned learned, bought F Type @ 10 months and 4k at remarkable savings! I think a lot of traditional Jag buyers jumped on them and then found out what a real sports car is like to live with every day, especially with Pirelli tires and performance seats. Same reason there is always a lot of low mileage Porsches for sale. Great idea on Sat. not so great in traffic on Mon.