The Burrow
Feb 21, 2024
It’s true that cars depreciate in value as soon as you drive away from the garage, but some brands and models hold their value better than others. Whether you choose to purchase a new or used car, once you’ve started using it, it likely won’t be worth the value you paid for it.
The used car market in particular, is booming, with the market size valued at USD$1.66 trillion in 2022, and it’s expected to grow at a compound annual growth rate of 6.1% from 2023 to 2023.1
If you’re thinking about trading your car in for a newer model, or want to sell it for cash, you’re probably wondering how much you can get for it, and how it stacks up compared to the day you got it.
Luckily, the car insurance comparison experts at Compare the Market have the answer. We’ve looked at data across the USA, Australia, and Canada to find out which cars have the best and worst resale values in each country, so it’s time to see how yours compares.
No one likes to think their car has the worst resale value, but unfortunately, one car has to take the claim…
With its price dropping by a staggering 42.70% on average, Tesla’s Model Y has the worst resale value in the US, despite it being a battery electric vehicle.
In fact, electric vehicles don’t fare very well in the US, with four out of our top five worst resale values electric vehicles (EVs). The Volkswagen ID.4 and Kia EV6 come in second and third place, with a resale price of 68.39% and 68.75% respectively, on average.
The Hyundai Ioniq is in fifth place, with a better resale value of 85%; and the Jeep Grand Cherokee is the only petrol car to make it onto the list, with its value dropping around 20.22% once it’s been driven away from the garage.
With car makes differing between Australia and the USA, the results looks a little different. Locally, MG’s ZS fares the worst, dropping by 15% as soon as they’re driven off.
The Toyota Landcruiser comes in second place, retaining around 93% of its value, followed closely by the Mazda CX-5.
Cars in Australia hold their value much better than their American counterparts; with the Mitsubishi Triton and Isuzu UTE both listed as also having a poor resale value, despite them only dropping by less than 4% each.
Canada’s resale values are comparatively even better overall than Australia’s, with the Ford Escape dropping its value the most, worth around 88.09% once it’s driven away from the garage.
However, the Mazda CX-5 and Honda CR-V are the only other cars on the list to drop their value, and that’s just by 4.71% and 3.54% respectively. While the Hyundai Tucson and Toyota RAV4 are technically amongst the worst resale values, they both appreciate in value – with the RAV4 increasing by 9.51% in price!
On the other end of the spectrum, these are the cars that retain their value – and sometimes even increase – the most. So, which models depreciate the least?
There are two car makes and models that increase in value across the American market, and that’s the Toyota Tacoma (110.39% retained value), and the Ford F150 (101.78%).
Toyotas fare particularly well, with the RAV4 and Camry both coming in the top five, losing just 0.75% and 7.17% of their resale value once they’ve left the sales yard. The Honda CR-V also holds its value well, at 94.13%.
A compact hybrid car, the Toyota Corolla is the best car to purchase in Australia if you want it to retain its value; as in fact, it tends to increase in value over time, at an additional 17% on average.
The Toyota RAV4, Hyundai i30, Ford Ranger, and Toyota HiLux all also typically increase in value, with the RAV4 and i30 close to 10% more. With four out of the five cars all hybrid, it’s clear that these are the types of vehicles that are currently increasing in value in Australia.
Toyota fares well across the board, with the Corolla increasing by almost a third in value, making it a great investment option if you’re considering selling your car a couple of years down the line.
Similarly, the RAV4 Hybrid scores well, at an almost 14% increase. Hyundais also retain their value well in the Canadian market, at a 13.64% and 10.37% increase respectively for each the Elantra and the Kona, with the Honda Civic making up the top five.
EVs are the way forward in the automotive industry, with plans across the world to eventually have them replace petrol and diesel cars. In 2023, the EV market was priced at a cool USD$49.1 billion in the USA with almost 2.5 million registered vehicles on the road, with 56.5% of them Tesla.2
So, it’s interesting to see that according to this data, EVs on average retain their values the least, with hybrid cars the better investment choice. And, interestingly, despite Tesla owning the US market for electric vehicles, we can see their Model Y holds its value the least out of all cars, at a 42.70% drop.
Adrian Taylor, Executive General Manager of General Insurance at Compare the Market states: “Whilst it’s clear to see that some car models and brands retain their value better than others; irrespective of what vehicle you drive, it’s important to have some level of car insurance in place to protect yourself should the worst happen.
“The cost of a car insurance policy can vary significantly, depending on a range of factors. For example, the level of cover you opt for, as well as the age and specific model of your vehicle.
“Regardless of the policy you are interested in, always be sure to check the PDS and TMD so that you are aware of any limits, restrictions and inclusions to your cover – that way, you know exactly what you’re covered for and can choose the policy that’s right for you.”
Sources:
Methodology:
A list of the most popular car models in 2022 was gathered for each of the countries analysed. The cars used must have had more than 10 prices on-site.
The car models were ranked by percentage change by working out the difference between the two numbers being compared for each trim, dividing the increase by the original number and multiplying the answer by 100. An average of the percentage change from each model’s trim was calculated to reveal the average % change per model. The % of the original price was also calculated.
All data correct as of 18/01/2024.