Depreciation!

[GTNator]

In my opinion, the only way to overcome depreciation is what I have done for the first time in my life. I used to trade every 3 to 4 years and took a beating even though I always paid cash for the difference. My last purchase was a new '05 Tahoe Z71, loaded with all options. I paid somewhere around $42K. Still driving it, 195,000 miles on it. The only repair I have made was a water pump at 185,000 miles. Got 125K before I needed a break job. Should bring $5000 to $5500 today. That brings my cost to roughly $230 per month. The only time I have financed a car was in 1984, right after I almost went broke. I had no money and bought a worn out 6 cylinder Mustang and had to finance it. Wound up paying big time on this one. Never again if I can help it! Tahoes and other makes with the 5.3 motors will last a long time if you just take care of them and drive them sensibly. Probably should not have posted this. My engine, transmission or AC might go out now.

Lol, I hope nothing goes wrong.

I wonder if the 6.2l is as reliable over the long run. Yes, GM has made the 5.3 forever.


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[GTNator]

They sell millions of these things. I guarantee only a very small percentage know about the booming and buffetting issues. People here sometimes don’t even know. There’s not even a sticky on them.

I very much doubt that’s the issue.

I just ran the KBB:

2014 Tahoe LTZ with 50k miles in good condition is: $32k.

->Original MSRP: $59k
Or 54% of its original value.

———————————————

2015 Tahoe LTZ with 50k miles in good condition is $40k.

->Original MSRP: $61k.
Or 64% of original value




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Exactly. I believe that the evidence shows that these GM truck based SUVs actually hold their value very well. I think it’s because of that strong truck frame, it last longer and people will pay more for it. Take a look at CarMax or autotrader. I’m surprised by how much money an 8 year old Suburban LTZ with $80k miles brings in. You won’t get anywhere close to this much residual value from a BMW or Mercedes, let alone a Ford.


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[GTNator]

Exactly, I totally agree. I believe that the evidence shows that these GM truck based SUVs actually hold their value very well. I think it’s because of that strong truck frame, it last longer and people will pay more for it. Take a look at CarMax or autotrader. I’m surprised by how much money an 8 year old Suburban LTZ with $80k miles brings in. You won’t get anywhere close to this much residual value from a BMW or Mercedes, let alone a Ford.


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[cardude2000]

Exactly. I believe that the evidence shows that these GM truck based SUVs actually hold their value very well. I think it’s because of that strong truck frame, it last longer and people will pay more for it. Take a look at CarMax or autotrader. I’m surprised by how much money an 8 year old Suburban LTZ with $80k miles brings in. You won’t get anywhere close to this much residual value from a BMW or Mercedes, let alone a Ford.


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All things held equal (like known brand issues or ‘newness’ of a brand like Genesis) its really a function of initial price it seems.

ie: A 80k yukon won’t hold its value nearly as well as a 40k Tahoe lt.

A base x3 holds its value quite well compared to a fully loaded x5.

It’s the margin options/badge engineering that take it to the chin on resale.

My loaded E class is barely worth 30% of what it was when I bought it in 2014. A base C class though is well over 40% of original value.

 

[PwrdbyM]

The variable one may forget when calculating depreciation is gathering the formula from the MSRP price. On large American vehicles the discount is usually pretty generous. We got a discount of $9,700 off our 16 LT. When dealers are selling new models for almost $10k off then that's instant depreciation. If you look at how far the vehicles are falling from the lowest actual paid prices then you'd see it's actually not bad. I paid $54,*** on a MSRP of $64,***. If I tried to trade it in a month later I'd be offered $50k because they know what new ones are selling for. Someone who paid $61k for the same vehicle at another dealer would be appalled by the $50k offer one month later. This is why it's important to shop actual sale prices and ensure you're aware of what dealers are offering for discounts in other areas as well as manufacturer incentives. Ask anyone and they think they got a great deal on their car, but the reality is most people overpay. If you pay more than the next guy then you've saddled yourself with more depreciation.

 

[cardude2000]

The variable one may forget when calculating depreciation is gathering the formula from the MSRP price. On large American vehicles the discount is usually pretty generous. We got a discount of $9,700 off our 16 LT. When dealers are selling new models for almost $10k off then that's instant depreciation. If you look at how far the vehicles are falling from the lowest actual paid prices then you'd see it's actually not bad. I paid $54,*** on a MSRP of $64,***. If I tried to trade it in a month later I'd be offered $50k because they know what new ones are selling for. Someone who paid $61k for the same vehicle at another dealer would be appalled by the $50k offer one month later. This is why it's important to shop actual sale prices and ensure you're aware of what dealers are offering for discounts in other areas as well as manufacturer incentives. Ask anyone and they think they got a great deal on their car, but the reality is most people overpay. If you pay more than the next guy then you've saddled yourself with more depreciation.

It’s a great point. I CUSTOM ORDERED my Denali and got 10%+ off. Good luck doing that with a foreign car.


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[UrbanSuburban]

This is interesting, someone imported that vehicle into Canada Philipines or Brazil maybe. That RIV sticker is not a Transport Canada Sticker but rather a proof that vehicle met the standards after modification. This was then probably traded into a Dealer in Canada and then sold to a broker in the states. All GM vehicles that are first sold in Canada are coded Z49. If I had bought a vehicle in the States to bring back across the border I would have to get it inspected and have that Sticker placed on it to get it licensed and insured

 

[Tonyrodz]

This is interesting, someone imported that vehicle into Canada Philipines or Brazil maybe. That RIV sticker is not a Transport Canada Sticker but rather a proof that vehicle met the standards after modification. This was then probably traded into a Dealer in Canada and then sold to a broker in the states. All GM vehicles that are first sold in Canada are coded Z49. If I had bought a vehicle in the States to bring back across the border I would have to get it inspected and have that Sticker placed on it to get it licensed and insured

Hopefully I'll be able to check out the rpos next time. It's actually at a dealer in NJ, who bought it at an auction in NJ.

 

[noob]

Anything over 50k drops like a brick, the more it costs the more it depreciates

 

[GTNator]

Anything over 50k drops like a brick, the more it costs the more it depreciates

I generally agree with you’re statement.
One notable exception is the Mercedes G wagon. That drops in value but does not “drop like a brick”.


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