Depreciation Reaches Yearly High in October
Photo of 2013 Chevrolet Express 2500 cargo van courtesy of General Motors.
Depreciation for used vehicles reached 2 percent for October, reaching the highest monthly level so far this year, according to a monthly report from Black Book.
Domestic cars lost the most in value at 3.2 percent among vehicles from the 2009-2013 model-years, while domestic trucks lost 2.1 percent compared to September levels. Compact pickups and full-size passenger vans and full-size cargo vans showed the most strength, declining 0.8 percent, 1.7 percent, and 2.1 percent respectively.
Two passenger car categories lost more than 4 percent of their value in the month. Average pre-recession depreciation has been between 1 percent and 2 percent.
Compact cars led the decline with a 4.4 percent slide to $9,327 on average. This category includes the Honda Civic, Chevrolet Cruze, Toyota Corolla, and Ford Focus. Full-size cars lost 4 percent to $11,848 on average. This category includes the Chrysler 300, Toyota Avalon, Chevrolet Impala, and Nissan Maxima.
For the second consecutive month, premium sporty cars led all car segments with 1.6 percent decline in value to $48,976 in a category that includes the BMW 6 Series, Audi R8/S8, Mercedes-Benz CL-Class, Mercedes-Benz SL Class, and Cadillac XLR.
Fuel-efficient cars have also fallen prey to higher depreciation at a time when gasoline prices have fallen to a four-year low. In addition to compact cars, entry-midsize cars (3.5 percent to $11,204) and entry-level cars (3.5 percent to $7,733) also fell hard.
Full-size vans are also maintaining strength from a year ago. Full-size passenger vans have depreciated only 0.9 percent to $19,468 year over year, while full-size cargo vans have fallen 5 percent to $20,568. Other year-over-year winners include compact SUVs (down 3.8 percent to $19,648) and compact pickups (down 3.5 percent to $15,907).
Depreciation Returns to the Used-Vehicle Market