A recent study by iSeeCars shows Tesla models and pickups have very slow depreciation rates compared to the rest of the industry
Electric vehicles other than Tesla have huge depreciation, however
Mercedes-Benz S-Class, Audi A6 and Maserati Quattroporte depreciate most after three years
A recent study by iSeeCars found that the Tesla Model S lost just 36.3% of its initial value after three years. The Tesla Model X did even better with just a 33.9% drop in value. But the champion was without question the Tesla Model 3 which loses on average just 10.2% of its value.
The Tesla Model 3 went on sale in 2017. The iSeeCars study calculated that models from 2017 have lost an average of just $4,720 over that time period. High demand and limited availability would explain such a phenomenal result for Tesla’s most affordable electric vehicle.
The findings are even more surprising considering that electric vehicles not called Tesla depreciate more than any other vehicle. Averaging a 52% drop in price over three years (and that’s including Tesla’s phenomenal numbers), EVs depreciate 15% to 20% faster than traditional cars, SUVs, and trucks. The BMW i3 (60.4%), Nissan LEAF (60.2%), and the Kia Soul EV (58.7%) show the highest depreciation levels in the industry.
Pickup trucks tend to do well in keeping their value, the study found. The Toyota Tacoma (25.2%), Chevrolet Colorado (28.8%) and the Toyota Tundra (29.4%) all preserve an impressive portion of their initial value, as does the Honda Ridgeline (33.4%). On average, pickups lose just 34.3% of their value over three years with no model showing higher than 38.1% depreciation.
SUVs lose 39.7% of their initial value while subcompact, compact, and mid-size cars average 39.4%. The industry average for all vehicles is 39.1%.
Of course, there are outliers that lose a lot more than that. The Audi A6 (55.8%), Maserati Quattroporte (58.8%) and Mercedes-Benz S-Class (56.8%) are just a few examples.
For buyers looking for good value on the pre-owned market, cars that depreciate heavily can provide a real bargain, especially since depreciation isn’t always correlated with poor quality.
For new vehicle buyers, however, high depreciation is a cost that must be factored into the final decision, unless of course the intention is to lease for three years and return the vehicle. In any case, the study is certainly worth a look.