Depreciation is a cruel mistress, but it can cut both ways depending on which side of the market you’re on.
The past few years have been a minefield for new and used car values. With virtually every car’s value shooting to the moon, the old adage that your car will lose value the instant you drive it off the lot certainly didn’t feel true (and that’s not exactly how it works, even in normal times). Now, it seems prices for used cars are coming back down to earth, at least. If you own one of these luxury cars, though, the picture may not be quite so rosy if you’re looking to sell in the near future.
Research firm iSeeCars put together a study on the cars with the best and worst resale value over the first five years of ownership. Of course, the typical culprits pop up at each end of the spectrum. If you want a car that holds its resale value well, buy a Jeep Wrangler or a Porsche 911 — no surprises there. While we’ll get to that list as well, let’s look at the other side of the coin.
Again, as you’d expect, a deluge of luxury nameplates flood the worst resale value list, since most luxury models depreciate far faster than their mainstream counterparts. On average, your car will likely lose somewhere around 38.8% of its value over a five-year span. Luxury cars, on the other hand, lose about half (48.8%) according to iSeeCars’ data, but every one of the vehicles with the worst resale value beats that industry average by a healthy margin.
iSeeCars’ methodology
For this study, iSeeCars says it analyized 1.1 million used cars and trucks from model year 2018 sold between November 2022 and October 2023. Low-volume models, heavy-duty trucks and vans were not included in the list, and MSRPs from 2018 were inflation-adjusted for 2023 dollars, based on figures from the U.S. Bureau of Labor Statistics. Analysts then modeled the difference in asking prices and the MSRPs for each of these top 25 lists.
Top 20 models with the worst five-year resale value
| Rank | Model | Average 5-Year Depreciation | Loss from original MSRP (inflation-adjusted) |
|---|---|---|---|
| 1 | Maserati Quattroporte | 64.5% | $90,588 |
| 2 | BMW 7 Series | 61.8% | $72,444 |
| 3 | Maserati Ghibli | 61.3% | $58,623 |
| 4 | BMW 5 Series Hybrid | 58.8% | $37,975 |
| 5 | Cadillac Escalade ESV | 58.5% | $63,885 |
| 6 | BMW X5 | 58.2% | $44,828 |
| 7 | Infiniti QX80 | 58.1% | $47,399 |
| 8 | Maserati Levante | 57.8% | $55,858 |
| 9 | Jaguar XF | 57.6% | $39,720 |
| 10 | Audi A7 | 57.2% | $48,917 |
| 11 | Audi Q7 | 56.8% | $41,731 |
| 12 | Cadillac Escalade (Short wheelbase) | 56.5% | $59,093 |
| 13 | Audi A6 | 56.3% | $38,252 |
| 14 | Volvo S90 | 55.8% | $35,365 |
| 15 | Nissan Armada | 55.7% | $36,875 |
| 16 | Mercedes-Benz S-Class | 55.7% | $70,563 |
| 17 | Lincoln Navigator L (Long wheelbase) | 55.5% | $57,224 |
| 18 | Mercedes-Benz GLS | 55.5% | $54,523 |
| 19 | Tesla Model S | 55.5% | $60,145 |
| 20 | BMW 5 Series (non-hybrid) | 55.3% | $39,856 |
With the exception of the Nissan Armada, every vehicle within the top 20 places comes from a luxury brand. That suggests, as iSeeCars exceutive analyst Karl Brauer points out, a major difference between what automakers offer in their lineups and what people actually want (and that demand then drives higher resale values). We’ve said several times over the past few years that sedans aren’t great in terms of sales volume or resale values, but luxury sedans make that trend ring painfully clear.
Or, if you want to look at this side of the study in a positive light, it means you can probably snag a great deal on used examples of these 20 models. You won’t have to shell out nearly as much cash as you would buying brand new, and you won’t have depreciation to worry about.
A word of warning though: You also may not have a warranty to help you out if things go wrong on your five-year-old luxury car. And when things do break…prepare for some expensive repair bills. Your call.
