These Are the Best and Worst Cars for Depreciation

Summary 

• Jeep Wrangler remains the best vehicle for holding its value, while overall five-year depreciation for new cars drops from 40 percent in 2021 to 33 percent in 2022

• Looking at three-year depreciation shows a mere 17 percent decline in value, the smallest drop on record, with some used models, such as the Porsche 911, actually appreciating in value above its original MSRP

• Fuel efficient cars, including hybrid vehicles, small cars, small SUVs, and midsize cars, held their value the best, reflecting ongoing spikes in gas prices

• Large luxury cars lose the most value, including the BMW 7 Series, Maserati Ghibli, and Jaguar XF

Pandemic-related disruptions to automaker supply chains and their impact on new vehicle and used vehicle pricing have dramatically affected retained value rates as well. An analysis of three- and five-year vehicle depreciation reveals that cars retain more value than they have in recent memory, and that a small number of cars have even appreciated in value, according to a new study by automotive firm and car search engine iSeeCars.

iSeeCars analyzed over three million three-year-old and five-year-old used cars sold in 2022 and found the average five-year-old car lost only 33.3 percent of its value from MSRP. Compared to 2021, that represents a 17.0 percent decrease in depreciation. “The relative scarcity of late-model used cars due to pandemic-related new car production disruptions has kept used car values high for more than a year,” said Karl Brauer, Executive Analyst for iSeeCars. Looking at individual models, the Jeep Wrangler tops the best resale value cars, while the BMW 7 Series is the vehicle with  the highest rate of depreciation.

Vehicles That Depreciated the Least in Five Years

The average five-year depreciation in 2022 is 33.3 percent, with the best cars for retained value over the past five years listed below.

The Jeep Wrangler and its four-door counterpart, the Wrangler Unlimited, hold the top two spots in the list of Vehicles with the Lowest Five-Year Depreciation, with around four times lower depreciation than the average car. “The Jeep Wrangler continues to embody the ultimate off-road companion, with timeless styling that keeps it popular long after it has left the new-car showroom,” said Brauer, adding, “Based on historical data, it’s no surprise these two Jeeps were the best resale value winners in 2021 as well. The Wrangler is essentially the poster child for ‘Best Resale Value Awards’.”   

Sports cars like the Porsche 911, Ford Mustang, Subaru BRZ, and Chevrolet Camaro, saw increased demand during the pandemic as a means for fun and escapism during lockdowns. “We saw prices jump for sports cars after the lockdowns began, and they maintained their strong original value even as restrictions were lifted,“ said Brauer. 

The other cars on the list are some of the most popular, best-selling cars: the Toyota Corolla, Nissan Versa, Honda Civic, and the Toyota Tacoma. The first three are compact cars with high gas mileage, while the Tacoma is a smaller midsize truck with a reputation for durability. “High gas prices always shift demand toward more fuel-efficient vehicles, increasing the value retention of these models,” explained Brauer.

Vehicles that Depreciated the Most in 5 Years 

iSeeCars also examined the vehicles that depreciate the most after five years. 

Luxury brand vehicles and larger vehicles dominate the cars that depreciate the most after five years. “Just as higher gas prices increase demand for fuel-efficient vehicles, they also decrease demand for full-size SUVs like the extra-large Cadillac Escalade ESV and Lincoln Navigator,” said Brauer, adding, “Luxury vehicles like the also tend to depreciate at higher rates because used car shoppers don’t value their premium features as much.”