Why do american cars have such bad resale value?

[Martin]

I was just browsing through trader.ca yesterday, and I punched in $2000-3000 and 1992-2002 and lo and behold. 90% of the cars were american, mostly chevys and pontiacs.


So why do they have such bad resale values? To me it seems as though even hyundais have better resale value.

 

[vi edit]

1. There's half a billion of them out there.

2. There's half a billion out there because GM/Ford/Dodge have to offer multi-thousand dollar rebates or 0% financing to get cars to sell. When you sell a car for a discount, it heavily reflects the resale of those cars in the future.

3. Domestic cars just flat out don't age well. Hop into a 3 year old Volkswagen with 50k miles on it and you'll be greated by a nearly soundproof cabin, non-squeeky dash and interior plastics, and solid sounding doors. Step into a domestic car with equal miles and age and you'll be met by rattling interior pieces, a large amount of road noise, and sloppy feeling steering and worn out knobs and dials.

4. Domestic cars are more or less designed to be disposable, with no small help by the manufacturers. Who wants to keep a car for more than two or three years when you can get into the same, if not cheaper car payments in two or three years and a brand new car? Offering 0% financing brings people out of the woodwork. They trade in fairly new vehicles and just keep perpetuating the poor resale cycle.

5. I will get flamed.

6. I I DO own 1 domestic, and have owned 3 others.

7. I DO own two previously-owned Volkswagens and there IS NO comparision between the build quality of a 3 year old Veedub and a 3 year old Chevy sedan.

 

[freebee]

Resale value is about perception...what consumers think about a certain car. In some cases, that perception hinges on reliabilty. In other cases, the demand of that particular vehicle will affect resale value. For example, you can have an unreliable (but well-performing) car that has a high resale values because of limited supply.

For many American cars you have the worst of both worlds....the cars are readily available, parts are cheap, and they are not very reliable. Putting it all together means very low resale value.

 

[Evadman]

Buy a Harley

Who cares about resale value? My truck will fall apart around me before I sell it.

 

[yakko]

<< 3. Domestic cars just flat out don't age well. Hop into a 3 year old Volkswagen with 50k miles on it and you'll be greated by a nearly soundproof cabin, non-squeeky dash and interior plastics, and solid sounding doors. Step into a domestic car with equal miles and age and you'll be met by rattling interior pieces, a large amount of road noise, and sloppy feeling steering and worn out knobs and dials. >>

My 10 years old VW doesn't have many noises either and most of those are because I drive hard.

 

[Miramonti]

<< So why do they have such bad resale values? >>



because they're so overpriced to begin with.

 

[IGBT]

There's a glut of used cars/trucks on the market these days from all the zero/near zero intrest loans offered a while back on new vehicles. So that makes the used market a "buyers market" for awhile. But lets face it ALL vehicles are disposable, depreciating, POS that all wind up in the junk yard some day.

 

[Zenmervolt]

<<But lets face it ALL vehicles are disposable, depreciating, POS that all wind up in the junk yard some day.>>

I know of a 14 year old Honda and a 26 year old Porsche that will not see a junk yard in my lifetime.

ZV

<--Will get rid of his two babies when they pry the keys out of his cold dead hands.

 

[geno]

Because no one has faith in them.

 

[johndoe52]

My dad has all chevy's. Really good cars imho, but there's in the shop for something ever couple of months. My gf 86 volvo hasn't needed more than an oil change in over a year.

 

[Don Vito Corleone]

<< My dad has all chevy's. Really good cars imho, but there's in the shop for something ever couple of months. >>



No offense but how is a car that is constantly in need of repair "really good"?

 

[StageLeft]

Because it is a well known fact that they do not age as well as imports. Anybody who thinks it's anything else should stop kidding themselves. And don't give me one-case anecdotal stories cause they're meaningless about how such and such chevy has run for 80 years.

 

[Mill]

My car is three years old and doesn't rattle or squeak one bit. The only service problem I have had is a belt tensioner came loose. I am anal about my car. I wouldn't have bought it, if I had thought it was a POS.

There used to be a good difference in build quality of imports and domestics. Domestics have bridged that gap.

Edit I have put over 70k in my car and it would probably be worth 20k to a dealer. That is why I would sell it privately.

 

[Zenmervolt]

<<I have put over 70k in my car and it would probably be worth 20k to a dealer. That is why I would sell it privately.>>

If you put $70,000 into a car, it damn well better not squeek/rattle for the next 100 years. Sheesh. For $70,000 I could keep my old Accord running perfectly until a year after I die, and I'm only 20 right now. Regardless, you've basically custom-built your car and have therefore overseen all the tolerances personally, a far cry from the factory assembly line situation. You simply cannot compare a car that has $70,000 (!) worth of aftermarket parts to a standard, straight off the assembly line machine.

ZV

 

[thebestMAX]

I think it is because most buyers of American cars dont maintain them very well. Those of us who do suffer for the masses sort of like paying taxes.

 

[ElFenix]

<< Because it is a well known fact that they do not age as well as imports. Anybody who thinks it's anything else should stop kidding themselves. And don't give me one-case anecdotal stories cause they're meaningless about how such and such chevy has run for 80 years. >>

most people only have anecdotal evidence. lots of it, but still anecdotal. actual reliability studies 3, 6, and 10 years down the road do exist, but they're done for the automakers and those people won't release them.

 

[vi edit]

<< Edit I have put over 70k in my car and it would probably be worth 20k to a dealer. That is why I would sell it privately. >>



------------------------------------------------

Trade-in Private Party Dealer Retail


Base Price $13,026 $14,625 $16,101

Optional Equipment $883 $982 $1,195

Color Adjustment $66 $74 $82

Regional Adjustment $-40 $-45 $-50

Mileage Adjustment $0 $0 $0

Condition Adjustment $0 $0 $0

Total $13,935 $15,636 $17,328

---------------------------------------------------

Trade in of just under 14k. I figured 25k miles, auto tranny, leather, power seat, and rear defroster. Far cry from the 23-25k that somebody orignally paid for it 2 years ago.

 

[BigJohnKC]

<< I think it is because most buyers of American cars dont maintain them very well. Those of us who do suffer for the masses sort of like paying taxes. >>


It's not just buyers of American cars that don't maintain them - I just bought an Altima last year, and I don't maintain my car very well at all - but of course that's the reason why i bought Japanese car so I wouldn't have to worry about maintaining it too much. And what do you mean "suffer for the masses"? What difference does it make to you if someone doesn't take good care of their car? Maybe pollution, but that's negligible....

 

[LAUST]

Ever look around the US much?

The dominant people in the US are lower Middle class, they have a wife, a few kids, a mortgage, a $4000 car thats only a few years old looks good.... But then again thats just logical thinking takin place.... There is fanticy land too where everyone grows up and gets a 6 figure income and gets money for nothin and chicks for free

 

[vi edit]

<< It's not just buyers of American cars that don't maintain them - I just bought an Altima last year, and I don't maintain my car very well at all - but of course that's the reason why i bought Japanese car so I wouldn't have to worry about maintaining it too much. And what do you mean "suffer for the masses"? What difference does it make to you if someone doesn't take good care of their car? Maybe pollution, but that's negligible.... >>



BigJohnKC, I think TBM was saying that even if someone keeps there car in immaculate condition(mechanically and cosmetically), they are still haunted by the completely pathetic resale value attributed to that car. Sure you get some sort of compensation from a dealer if you are trading in a car that is "like new", but a $1000 for a condition adjustment still doesn't make up for the 50% deprication of that car in under 3 years time.

 

[thebestMAX]

<<BigJohnKC, I think TBM was saying that even if someone keeps there car in immaculate condition(mechanically and cosmetically), they are still haunted by the completely pathetic resale value attributed to that car. Sure you get some sort of compensation from a dealer if you are trading in a car that is "like new", but a $1000 for a condition adjustment still doesn't make up for the 50% deprication of that car in under 3 years time. >>

Thanks Vi, just what I meant.

Just sold my '93 privately for almost $5000 over trade in value and the buyer is estatic. Always sold my cars privately and got much more than trade in. No buyers has ever come back at me either.

 

[Mill]

Vi I couldn't find out where you got your prices... KBB said Trade-In Value $15,330. That is after three years of use. 17,565 to a private seller. That is of course if the car was stock.

 

[vi edit]

Millenium, I got it from edmunds. I've found edmunds to be more in line with what *real* trade in values are. KBB tends to inflate both the trade-in price as well as selling price of their appraisals. And yeh, I know that those are for stock prices. Most dealers will actually shoot you a LOWER price for non-stock cars. Buyers of used cars with non-stock parts want really nothing to do with the car, so therefore, the dealer lowballs you to get you to try and sell it outright.

 

[Mill]

I know they give you a lower price. That is why I wouldn't trade it in to begin with. Even one little mod and the dealer will drop the amount they will give you. I can't stress private seller enough.

 

[LAUST]

If anyone just goes in and accepts what a dealer offers your a "lay-down" to begin with, when I bought my truck on this last round I came in and told the guy I wanted $13,000 for my Civic, I paid 13,500 one year before, I also told him I would have a check for the remaining on my truck from a total cost of $28,000 after Everything including taxes ($32,000 MSRP)

took $4000 off MSRP + Taxes and all that dealer Bull$h!t they try to add on plus drove around in a new Civic for a year at the cost of $500

I don't listen to any of the books, Edmonds, NADA, KBB... tell em what TF you WILL do, wants are not an option, you go in with wants you leave bleeding and hold the title SUCKER for the rest of your Soft life.

Dealerships have a lot more money to play around then most people think... ever hear of a dealer kickback? also that invoice sh!t..heh... go ahead and buy that one, then when you see the taxible value when you get your plates then you can see the price of the other invoice they don't tell you about.