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Depreciation

VAT is often overlooked in these calculations.

A car (in theory) instantly loses 20% the moment you sign on the dotted line.

The VAT isn't lost, it's merely 'paid'. As a business you might be able to reclaim it but you'd still have to charge it again when you sold it (VAT qualifying).
You don't lose anything by paying the VAT.
 
Depreciation has a lot going for it!

It meant I could buy a 4 year old SLK 280, with only 16K miles on the clock, for 1/4 of the price of a new one.
 
The VAT isn't lost, it's merely 'paid'. As a business you might be able to reclaim it but you'd still have to charge it again when you sold it (VAT qualifying).
You don't lose anything by paying the VAT.

My point is it's included in "depreciation" but it isn't depreciation, it's sales tax.

If a car is worth 50% of it's new value at year 3, it's depreciated 30% and you paid 20% in sales Tax.
 
My point is it's included in "depreciation" but it isn't depreciation, it's sales tax.

If a car is worth 50% of it's new value at year 3, it's depreciated 30% and you paid 20% in sales Tax.

It doesn't work that way.

If you bumped up sales tax dramatically - say to 100% on cars it would almost certainly increase the value of used cars.

VAT's impact is more subtle. It increases the gross margin that dealers have to make on tradeins and it increases the cost on servicing and repairs.
 
OK, I confess it: the weather's rubbish, I have a horrible cold, and I'm bored :D

Now, we all know that depreciation is the single largest cost of car ownership and one of the "benefits" of Mercedes ownership is that they hold their value better than many, so I whiled away 5 minutes of my time playing with the What Car? Depreciation Calculator because I thought it would be amusing to find a few makes and models that don't do so well. All the numbers quoted below are calculated from that calculator.

As a benchmark, an E-Class E350CDI Avantgarde Saloon retains 45% of its initial value after 3 years. We all know that first year depreciation is heaviest for any car though, and this one loses 33% of its initial value in that first year - which is why ex-demo cars should be such good value.

Now, we're all told that small hatchback's retain their value well so what about something mundane like a Toyota Yaris 3dr 1.0 VVT-i T2? That manages to retain 41% of its initial value after 3 years, and it loses 39% of its initial value in it's first year. So, proportionally, the E350CDI Avantgarde Saloon does better at both 1-year and 3-year milestones - although the monetary loss is obviously much larger as it costs more than three times the price of the Yaris to start with.


OK, now for some fun. Here are the worst two cars I found for first year depreciation:
  1. The Cadillac CTS 3.6 V6 Sports Luxury Saloon manages to shed an eye-watering 71% of its £45,241 purchase price in it's first year. That's a whopping £2.68 in depreciation for every mile that an average driver would cover in those first 12 months :crazy: At three years old, it manages to retain just 19% of its initial OTR price :eek:
  2. Then there's the Citroën C6 3.0 HDi V6 Exclusive Auto Saloon which loses 76% of its £40,160 purchase price in the first year or a mere £2.54 / mile over 12,000 miles (!), and at three years old, it retains a whole 16% of its initial OTR price :eek:
So, who can find any other "star" performers? :D



I will take the 5th.
 
[*]Then there's the Citroën C6 3.0 HDi V6 Exclusive Auto Saloon which loses 76% of its £40,160 purchase price in the first year or a mere £2.54 / mile over 12,000 miles (!), and at three years old, it retains a whole 16% of its initial OTR price :eek:[/LIST]

Rubbish.

Try to find one even three years old for £9k.

Just to help here are all the HDi up to 3 years old on Autotrader. The cheapest is 2009 and 56k miles for £13,900.
That is a 2.7, which listed at £33k new. 2.7 do drop in value because of the high RFL cost.

Lets take a realistic new sale price of ~£27k, now it's worth ~£13k which leaves a drop of £14k over 56,000 miles and just under 3 years.

looks like it's lost less than an E220Cdi to me.

http://www.autotrader.co.uk/search/...1/maximum-age/up_to_3_years_old/sort/priceasc
 
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I have never bought a new car in my life, and don't think I ever will as a private buyer, I just can't justify to myself writing off big money for the undoubted pleasure of owning something modern that is new or nearly new, though not in any way knocking anyone who choses to spend their own cash this way.

Bought current car for £3,100 with a warranty, yes it's done 160k and is ten years old but as I see it it was in great nick with a full service history so the most I can ever "lose" is £3,100 and I'll put around 18,000 miles a year on it, service it at the correct intervals, and keep it while it looks and drives this well.

Wish I could be this sensible when it comes to buying motorbikes though!
 
Only ever bought one new car, nice for the first few months then the birds crap on it the same as the old one, I sold my previous to a friend and looked at it every week and thought I would be £££ better off if I was still driving it.
 
Rubbish.

Try to find one even three years old for £9k.

Just to help here are all the HDi up to 3 years old on Autotrader. The cheapest is 2009 and 56k miles for £13,900.
That is a 2.7, which listed at £33k new. 2.7 do drop in value because of the high RFL cost.

Lets take a realistic new sale price of ~£27k, now it's worth ~£13.5k which leaves a drop of £13.5k over 56,000 miles and just under 3 years.

looks like it's lost less than an E220Cdi to me.

Used CITROEN C6 Car for Sale - Auto Trader UK

True, this one is 4 years old.

2007 Citroen C6 2.7 HDi V6 Lignage 4dr Auto Diesel Salo | eBay

This one on 58 plate doesn't sound bad:

http://www.ebay.co.uk/itm/2009MY-58...mobiles_UK&hash=item3f1295e5d0#ht_1372wt_1270 With only 36000.
 
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I think you should buy it.

I did consider a C6 and was very impressed by the overall refinement, it's a lot quieter than an E class, more S500 levels of noise...but...it was a bit sluggish in 2.7 litre form and due to being a bit juicy "enjoys" a high RFL cost, which is what kills residuals.
Both the 2.2 and 3.0 Hdi have better residuals than the 2.7 Hdi as a result.

One thing that I noticed though was that the drivers seat didn't go back quite far enough for me and was set a bit high and over-stuffed. As a result it felt uncomfortable.
The dashboard controls and switchgear being from the PSA parts bin is a let down, especially against such things as the head up display and diffused air ventilation system.

As a car though owners reports are very encouraging, with reliability being high.

What's not to like, styling...good, refinement...good, reliability...good, corrosion resistance...excellent...
 
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FTC Leasing (www.ftcleasing.co.uk) have a 2008 C6 at £10,950.

More interestingly, their site is worth a look for late model very high spec Mercs, with massive depreciation.
So a 4 year old base spec car is worth more than the O/p says the top spec one is worth after 1 year.

Thanks :)
 
Why do people go on and on about depreciation :dk:

Most people that buy cars do not plan to make a profit on them. They buy them to use. Do you expect to get anything back when you buy a shirt from M&S? Do you expect to get anything back when you spend money on that carribean cruise?

I do less than 4000miles a year and would conviniently get buy using a zip car every weekend but I just wanted a brand new car. I can afford the monthly payments so why not enjoy a new car afterall I aint taking nothing with me whe I leave this world.
 
Why do people go on and on about depreciation :dk:

Most people that buy cars do not plan to make a profit on them. They buy them to use. Do you expect to get anything back when you buy a shirt from M&S? Do you expect to get anything back when you spend money on that carribean cruise?

I do less than 4000miles a year and would conviniently get buy using a zip car every weekend but I just wanted a brand new car. I can afford the monthly payments so why not enjoy a new car afterall I aint taking nothing with me whe I leave this world.

In order that we should not "go on about" anything trivial...have you got a list of what you find acceptable to discuss on a car owners' forum? Please.:doh:
 

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