Decoding Depreciation: Why Luxury Cars Hold Their Value In The Pre-Owned Market


Decoding Depreciation: Why Luxury Cars Hold Their Value In The Pre-Owned Market


Depreciation has to be the first thing that strikes your mind when you want to buy your dream luxury car. But what is depreciation in the first place? It is the decline in a vehicle's worth over time. Read on the blog to learn the depreciation factors to have an experience Smart car buying: 


Delving into Depreciation 


The more mileage the car is driven, the higher the depreciation rate would be. Mileage is a key factor as it influences the overall condition of the vehicle and its market value.  


Vehicle Stage 

The cars in pristine condition tend to have lower depreciation rates than others. Servicing regularly and paying meticulous attention to instant repairs contribute to the longevity of a car's life. Cars that are maintained well, certainly have high resale value.  


The Brand

The reputation of the car’s brand can impact its resale value. Also, the historical performance of the brand in terms of durability and reliability has an impact on the resale value. Usually, the best luxury cars that are well-known for longevity and quality like BMWX1 and Audi A4 depreciate at a much lower rate than other brands.  


Fuel Efficiency 

Environmental concerns are increasing like never before. This rapid growth in environmental concerns paves the way for the emergence of vehicles with higher fuel efficiency. As consumer preference transformed to eco-friendly options, mostly the older models with less fuel efficiency must meet the higher depreciation rate. 


Environmental Considerations 

As consumers shift preferences toward more eco-friendly and cost-effective options older models with lower fuel efficiency won’t speak volumes. 


When brand-new cars are struggling because of rapid depreciation, pre-owned vehicles keep their value intact. That is why it is wise to buy a second-hand luxury car than a brand-new car.  


Why Does Pre-Owned Market Hold Its Value?

Statistics show that brand-new cars lose around 20% of their value in the first year. And the expensive cars will be worth about 40% of what you paid after five years. Think about the car that you spent lakhs only worth less than half of the amount you spent after a few years. It is terrifying, isn’t it? In the face of adversity, solutions arise. 


The solution to overcome this depreciation is switching to pre-owned cars. When brand-new cars fail to hold their value, used luxury cars hold their value strong for a long time. 


Cars in the pre-owned market often face minimal depreciation. This is because fancy cars are furnished with premium materials, the finest craftsmanship, and cutting-edge technology. This ultimately needs to the longevity and durability of the vehicle. As these vehicles belong to esteemed brands and come up with exclusive features, an outstanding driving experience is guaranteed. This is why opting for second-hand luxury cars is a smart move. 


To conclude, not all pre-owned cars you come across are wise investments. The lifeline of your car hinges on your dealership, much like how securing the right car insurance promises safety and peace of mind throughout your vehicle's journey. 


Our cars are meticulously chosen and undergo 100+ detailed inspections. To lighten your load at Kamdhenu, we got you covered from car insurance to after-sales support.