What is the depreciation period and residual value rate for sedans?
2 Answers
The depreciation period for sedans is ten years with a residual value rate of 5%. Here are the specific calculation methods: 1. First three years: The value decreases by 15% annually for the first three years; 2. Middle four years: The value decreases by 10% annually for the middle four years; 3. Last three years: The value decreases by 5% annually for the last three years. Note: Considering factors such as changes in new car prices, depreciation rates, and vehicle condition patterns, selling the car in the third year or the sixth year is actually the most cost-effective. The residual value rate for vehicles that are one to two years old and considered '80% new' is the lowest because new car prices are immediately discounted by 20% once sold by 4S dealerships.
When buying a car, the depreciation period is typically around 5 years, with a residual value rate of about 5% to 10%, depending on the car's condition and brand. For example, a new car driven for 5 years might only be worth 10% of its original price, but if well-maintained—like regular oil changes and avoiding accidents—the residual value can be higher. Different brands vary significantly; Japanese brands like Toyota and Honda have higher residual values due to their durability, while European and American cars may depreciate faster. I suggest that beginners consider this when buying a car—don’t just look at the new car price, as the residual value affects your budget when reselling. Additionally, in actual use, exceeding 100,000 kilometers accelerates depreciation, so controlling mileage helps retain value. In short, understanding depreciation saves you money—don’t regret it only when selling the car later.
