Most new-vehicle shoppers have probably heard the phrase, "a car loses value the moment you drive it off the dealership lot," but the everyday car buyer may not be aware to what extent and how much this amount can vary from model to model.
Understanding a car's resale value---what a vehicle will be worth down the line when going to sell or trade it in---can make the difference of hundreds, if not thousands, of dollars in the long run.
To help new-car buyers shop smart, Kelley Blue Book announced the 2021 model-year brand, category and top 10 winners of the annual Best Resale Value Awards, recognizing vehicles for their projected retained value through the initial five-year ownership period.
“Shoppers who choose to buy a 2021 model from one of our Best Resale Value Brand winners can be very confident that their vehicle will retain its value well over time," said Eric Ibara, director of residual values for Kelley Blue Book. "For 2021, Toyota and Porsche, respectively, are the best vehicle brand and luxury brand in terms of the highest average projected resale value across their full lineups.
"Continuing a longstanding trend among the top 10 vehicles, trucks and SUVs dominate once again amidst high demand and relatively low gas prices. And interestingly, with the unprecedented events of the last year, we are seeing a slight increase in the overall average residual value for new vehicles, explained by the significantly reduced car supply as well as the market continuing to shift to SUVs, which tend to have higher resale values."
This year marks the fifth Best Resale Value: Brand win for Toyota, which previously won the same honors in 2014, 2017, 2018 and 2019. For 2021, Porsche celebrates its fifth consecutive win as Best Resale Value: Luxury Brand.
Many new-car buyers do not realize that depreciation often is the greatest expense incurred by drivers during the first five years of vehicle ownership. An average 2021 model-year vehicle will only retain about 40% of its original value after a five-year ownership period, meaning that a $35,000 new car today will only be worth somewhere close to $14,000 after five years.
In comparison, all vehicles in Kelley Blue Book's Top 10 for Best Resale Value are projected to retain...