A crucial and often overlooked factor in determining the real cost of a vehicle is its depreciation: the difference between a vehicles cost when purchased and its value when traded or sold. Two different vehicles with similar purchase prices can vary significantly (by several thousand dollars!) in value at trade-in time.
Two examples that illustrate this point would be:
1) If you had been looking at Japanese 4-door sedans in 2006 and had narrowed the choice down to the Mitsubishi Galant GTS or the Honda Accord EX V6, both with leather seats and moonroof standard, you probably would have been able to buy the Galant at a heavily discounted price of around $25,100, $1000 under dealer's cost, compared to the Accord's price of about $26,100, $1000 over dealer's cost. Had you decided to save the $1000 and buy the Galant and were looking to trade it in in November 2009, it would have been worth about $3,400 less than a comparable Accord EX. So the $1000 you saved on the purchase turned into a $2,400 loss over the time you owned it. This is NOT an unusual or extreme example.
2) A Lincoln Town Car Signature Limited cost about $20,000 MORE than a comparably equipped, fully loaded Toytota Camry XLE when new in 2006, but in November 2009, the Lincoln was worth only about $2800 more than the Camry. This means during the same time period, the Lincoln depreciated $17,200 MORE than the Camry.
Some Practical Advice
So you can see that buying a new vehicle without considering depreciation can be shortsighted and costly. Since the best predictor of the future is the past, here's how a smart shopper can benefit from using the Galves values:
Suppose you were looking to purchase a vehicle today and anticipated keeping it for three years. Look up the current value of a three year old example of that vehicle and you will get a good idea of what to expect when you are ready to sell or trade it. If you are looking at 2007 models and tend to keep a car 3 years, look at 2004 model year pricing. If you tend to trade on a 4 year cycle, look up 2003 values, a 5 year cycle, 2002 models, and so on. This is particularly useful for comparison purposes after you have narrowed your choices to a few vehicles. Educated consumers and smart Internet shoppers have found this a great way to use our website.
As you can see, it makes a great deal of sense to consider depreciation before making a final decision on a new or used vehicle. Galves values can give you a clear picture of the future worth of a vehicle and assist you in your purchasing decisions. Use the Galves values with confidence. A small investment now can save you a great deal of money in the future! And as always you have nothing to lose because we offer the Galves Money Back Guarantee.
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