Summary:

Electric vehicles are the worst segment at holding their value, losing 49.1 percent in five years Trucks and hybrids retain the most value, losing only 35 and 37 percent, respectively Several sports cars, small SUVs and economy cars also hold their value extremely well, with the Porsche 911, Jeep Wrangler and Honda Civic among the best models Luxury SUVs and sedans, including the Maserati Quattroporte, BMW 7 series and Maserati Ghibli, are some of the worst vehicles at holding their value

All cars are holding their value better in 2023 compared to 2019 as a result of reduced new car production during the pandemic and constrained used car supply today. Prior to the pandemic, the average car would lose about 50 percent of its value in five years. Today the average 5-year depreciation is 38.8 percent, with electric vehicles the worst group – losing approximately half their value.

iSeeCars analyzed over 1.1 million vehicles sold from November 2022 to October 2023 to determine 5-year depreciation rates. In comparing this data historically, it found that depreciation was lower across major segments than in 2019.

“The good news for car owners is that all used cars hold their value better than they did five years ago,” said Karl Brauer, iSeeCars executive analyst. “But not all used cars retain value equally, with trucks and hybrids among the best segments and electric vehicles the worst. Hybrids have a nearly 12 percentage point advantage over EVs in value retention, which translates to thousands of dollars in higher market value after five years.”

EVs have the worst depreciation across major vehicle types

While the average 5-year depreciation for all vehicles is 38.8 percent, electric vehicles are more than 10 percentage points worse at 49.1 percent. SUVs also lose more value than the average vehicle at 41.2 percent.

“The disparity between electric vehicles and hybrids is worth noting, with EVs the worst group at holding their value and hybrids among the best,” said Brauer. “Some manufacturers have reduced or even abandoned the hybrid market in favor of EVs, but these figures suggest consumers still appreciate a hybrid’s combination of higher fuel efficiency and zero range anxiety.”

Vehicles that depreciated the least over five years

These 25 cars hold their value far better than average. The top-ranked Porsche 911 coupe only loses 9.3 percent of its value after five years, indicating incredibly strong demand for this sports car in the used market. Three other Porsches, along with six Toyotas, four Subarus, and three Chervolets, reflect ongoing consumer demand for sports cars, small SUVs, and fuel-efficient economy cars. The rise in used car pricing over the past few years drove many buyers toward these smaller, lower-priced models.

“Several sports cars are among the top vehicles at holding their value, including four of the top 10 models,” said Brauer. “We saw a spike in demand for ‘fun’ cars during the pandemic lockdowns, and demand for them remains strong in the post-pandemic world.”

Vehicles that depreciated the most over five years

Luxury cars always depreciate faster than mainstream models, with the latest data confirming luxury cars lose an average of 48.1 percent in value after five years. This compares to the industry average of 38.8 percent and 36.8 percent for non-luxury cars. The worst offenders are luxury sedans and luxury SUVs.

“Buyers looking to keep their vehicles for a long time shouldn’t be too worried about these depreciation rates,” said Brauer. “But if you’re rotating into a new vehicle every few years and those vehicles are luxury sedans or luxury SUVs, you’re losing a lot of money.”

Electric vehicle depreciation – among the worst

Electric vehicles are still relatively new to the market, which limits the ability to track their 5-year depreciation. But all of the EVs below have been in production for at least five years and have lost more value than the 38.8 percent average across all used cars.

“Between incentives that effectively lower an EV’s price before it’s even purchased and concerns about battery replacement costs, used electric vehicles have always suffered higher depreciation than equivalent gasoline cars,” said Brauer. “This pattern will continue until electric vehicles don’t require heavy incentives to sell and consumers gain confidence in their long-term ownership costs.”

Hybrid vehicle depreciation – among the best

Hybrid residual values have improved by nearly 20 percentage points in the past 4 years, moving down from 56.7 percent in 2019 to 37.4 percent today. A combination of higher fuel prices and increased familiarity with the technology has expanded the market and raised demand for hybrid vehicles.

“Toyota’s extensive history with hybrid models has established a strong customer base, though Honda and Hyundai are also building a hybrid following,” said Brauer.

Truck depreciation – Americans still love trucks

As a group, trucks hold their value better than any other vehicle type. The average truck loses just 34.8 percent of its value after five years, reflecting both long-term durability and consistent market demand for these models.

“Midsize trucks hold their value better than full-size models,” said Brauer. “Trucks like the Colorado, Frontier, and Tacoma have become so capable in recent years that they can replace a full-size truck for many buyers while remaining far easier – and cheaper – to drive, park, and operate.”

The best and worst SUVs for depreciation

SUVs remain the most dominant vehicle type in today’s car market. Their combination of an elevated ride height, comfortable passenger space, and practical cargo capacity make them popular choices, but not all SUVs depreciate equally. Smaller models have the advantage, with an average 5-year depreciation of 38 percent, while midsize models lose 42.9 percent and large SUVs lose 51.9 percent of their value.

“As SUVs get larger they get more expensive to buy and fuel,” said Brauer. “Large SUVs may be necessary for buyers requiring additional passenger and cargo capacity, but when SUVs pass from new to used status the market clearly favors smaller, more fuel efficient models.”

These are the best and worst SUVs for residual value in each size category below. As with nearly every vehicle segment, luxury SUVs consistently lose more value than mainstream models.

Small SUVs that hold their value the best

Small SUVs that lost the most value

Midsize SUVs that hold their value the best

Midsize SUVs that lost the most value

Full-size SUVs that hold their value the best

Full-Size SUVs that lost the most value

The pandemic’s effect lingers on

“Higher new and used car prices are here to stay,” said Brauer. “Until the restricted new car production of model years 2020 through 2022 moves completely through the used car market there will be a lack of vehicles to meet demand. That means better residual value for car owners, but also higher prices for buyers for the foreseeable future.”

Methodology

iSeeCars analyzed over 1.1 million used cars from model year 2018 sold from November 2022 to October 2023. Heavy-duty trucks and vans, models no longer in production as of the 2022 model year, and low-volume models were removed from further analysis. MSRPs from 2018 were inflation-adjusted to 2023 dollars based on data from the US Bureau of Labor Statistics. The difference in average asking price for each vehicle between its MSRP and its used car pricing was mathematically modeled to obtain the vehicle’s depreciation.

About iSeeCars.com

iSeeCars.com is a data-driven car search and research company that helps shoppers find the best car deals by providing key insights and valuable resources, including the iSeeCars VIN Check report and Best Cars Rankings. iSeeCars has saved users over $406 million so far by applying big data analytics powered by over 25 billion (and growing) data points and using proprietary algorithms to objectively analyze, score and rank millions of new cars and used cars.