2006_C350

How can a brand new $100K E63 sell for $50K after 2 years?

How can a brand new $60K E350 sell for ~$38K-$40K after 2 years?

Do Mercedes cars depreciate the fastest?

Correct me if my numbers are wrong.

K-A and Greg chime in!

instantfob

this is the way I see it.

Modern luxury is about how much technology you can pack into a car these days. Luxury buyers want the lastest and greatest therefore the 3 year "old" technology is not so attractive afterall.

DBV

Depends on the model. I would guess the E350 depreciates quickly because of the massive discounts Mercedes puts on the cars.

However, my GL350's have been some of the slowest depreciating cars I have owned, which is a good thing.

instantfob

Take a look at S63 AMG on ebay.
http://www.ebay.com/itm/Mercedes-Benz-S-Class-S63-AMG-2010-mercedes-benz-s-63-amg-base-sedan-4-door-6-3-l-/310831169978?forcerrptr=true&hash=item485efb41ba&item=310831169978&pt=US_Cars_Trucks
That's a good hit in depreciation.


Your GL350 has a strong secondary market for export to Asia. These cars fetch a premium from any Chinese used car dealers and they'll ship the trunk of country in a heartbeat.

mikemargolis

I hope you understand that "reserve not met" means that they are asking for an opening bid of $58,000 but do not agree to sell it at that price.

instantfob

Sorry, you are right and that's a bad example. Here's a closed listing with a best offer accepted under 58

http://www.ebay.com/itm/Mercedes-Benz-S-Class-S63-AMG-S63-AMG-Perf-Prem3-Rear-Seat-Pack-Distr-Pano-Night-Vision-151k-MSRP-/261298387396?forcerrptr=true&hash=item3cd698f9c4&item=261298387396&pt=US_Cars_Trucks

Tjdehya

Where do you see 2012 E63's selling for $50k?
Please tell me because I would like to buy.

hyperion667

LOL, that's a good point, must have been heavily used and not lightly used like you usually see them advertised as

2006_C350

Do a search on autotrader.com for 2011

Some are all low mileage and prices are not bad...although they are 2011 they still took a pretty big hit in depreciation

GregTR

My 3 year old 2011 E90 with 48k miles sold for 46% of original MSRP. MB is not the only car depreciating, they all do. Actually German cars tend to hold their value better than domestic or Japanese cars which is why they're prime candidates for leasing.

squareman

Hello Guys, new to the forum, just picked up an E350 last week. This topic intrested me because I did buy my car from a one owner, it is a 2011 with a book value of 36,000. I paid 30. When buying a luxury brand car it should come with an understanding that the value will depreciate greatly within the first two years. But as it has ben said Mercedes is far from the worst. American car makers suffer some of the worst depreciation models there are.

schorert1

but still, the dollar value...the cost per mile of a premium automobile depreciation wise is ...premium. I appreciate those who lease premium vehicles and fund that depreciation, while maintaining and basically breaking-in my vehicles. My CLK63 AMG lost 75% of it's MSRP in five years...THAT is brutal. I can buy an 11 e350 for half it's msrp, drive it for four years and sell it for half of what I pay for it...that is excellent retention of value.
The benefit of a vehicle like an MB or an Audi(until recently anyway) is that the body styles remain consistent for many years, the cars age very well and don't look dated. This was the appeal of Saabs until GM took them over, they were a high quality sporty car that ran forever and looked contemporary. GM took over and started changing bodystyles every 18 months.

El Cid

There are many factors involved in depreciation. However, ALL new cars depreciate tremendously the first two years and always have. That is why many "experts" recommend purchasing only used cars.
One factor is that there is a much higher profit margin on "luxury" cars, especially European ones, so they depreciate more. This is especially true for MB's, such as E550, S Class, AMG's, etc.
MB's probably depreciate less in the "C" and "E" V6 group than the more expensive models. A $100,000 car of any type is going to depreciate more than a lower priced car. People in that market tend to buy new because price is not as much a consideration. Also, they are in the class that wants the newest. Will be exceptions such as Maserrati, Ferrari, etc.
IMO, people who purchase high powered cars, especially AMG level are more likely to drive them really hard. So potential purchasers are going to be more cautious.
Of course, add in the high cost of German car parts and service, and values will take a hit. If you purchase a three year old European car, expect that within next three years you'll spend a lot of money on parts and maintenance. Reliability studies also factor in here.
Can also consider that the more expensive and more option loaded cars appeal to a much smaller market.

Tjdehya

A 2011 would be a 3yo car.
The average price for a 2011 E63 is ~$60k.
I still dont see the "brand new $100K E63 sell for $50K after 2 years"

Depreciation is generally by percentage and not by amount.
You cannot look at a $100k car, see that it lost $20k after the first year, look at a $40k car, see that it lost $10k after the first year and assume that the $40k car holds value better... its not that simple.

GregTR

Couple of things to point out:
1) Half its MSRP is not half of what the original purchaser paid as you can see most will pay 5-10+% less than MSRP to begin with so they haven't lost 50%, they lost about 45% of their actual cost base.

2) So losing 50% in the first 3 years is horrible but losing 50% of your money in the second 3 years is acceptable?

3) In the first three years there is practically zero cost of ownership other than regular maintenance. Once the warranty runs out you're looking at spending money on maintenance and possible things that break which can be a significant percentage of the car's purchase price so your overall ownership cost is probably higher on a used car than on a new one percentage wise.

Buying a new MB for $60K using it for 3 years and selling it for $30K is crazy as is buying a Camry for $30K new and selling it for $15K in 3 years but buying a used MB for $30K and selling it in 3 years for $15K while dealing with possible out of warranty repairs is A-OK and an excellent value? .

To each their own, I guess...

E Classy

WRONG. the best resale value brand is toyota/lexus. german cars are for the most part foolish purchases, all things considered. a higher price is paid for the "look & feel" and for status. taking into consideration the long term maintenance costs (think bmw, audi, and vw) and the fact that north america does not have an autobahn equivalent - they are idiotic. americans lease german cars because they can't afford to buy them new.

champaign777

this is very misleading information
you can even pay $20k same car if car has accidents / salvage title / high mileage / no options / etc
just to say i paid X for 2011 car means nothing without all details

schorert1

Well using your logic, why would anyone buy anything but a $14k hyundai, and trade them every two years? the idea is that there is value in owning a luxury brand to the owner.
Yes, losing 50% of 32k is preferable to losing 50% of 58k, escpecially when with a CPO vehicle I'm paying zero for repairs for 2/3 of that time. Also, depreciation isn't linear, but slows over time relative to purchase price.
Mercedes selling the same car, twice, to two different people who both feel they're getting a great "value" is brilliant. Here's a car, rent it from us, don't drive it a lot, keep it pristine so we can sell it to someone else.
If the service life of a vehicle is 200kmi, sacrificing 50% of value to consume 15% of serviceable life of the vehicle is not a great value. I use the next 40% of the vehicles life for 25% of initial cost. The original owner pays a buck a mile in depreciation, I pay less than .30...so there's no way I'm paying 70cents a mile in maintenance.

squareman

Sorry, I was not really trying to focus on my actual purchase, but since i kind of put it out there, it is a one owner no accident E350 sport fully loaded. Have not memorized the P1 P2 packages so I will have to stick with loaded. The original sticker was 59,9?? cannot remember last couple of numbers. Actual purchase price was 29800 with 48600 miles on it.

fintail

If Lexus purchases are all about logic (let's get real, they have as much of a "look at me" clientele as any German brand, just with a little less "feel), then a lot of people with a little extra money are illogical, judging how much the E competitor GS isn't lighting the market on fire.

I suspect if one looks at actual transaction prices rather than MSRP, non-AMG or luxobarge MBs don't depreciate catastrophically. What counts is percentage of purchase price retained, rather than MSRP retained, as few cars sell for sticker. Strongly discounted MBs are nothing new, just louder now with information so easily shared today.

If one wants the least raw depreciation, just get a base Versa or Accent, shut up, and drive...have fun!

champaign777

miles are missing

GregTR

In my logic your best bet is to buy a 2 year old car and drive it until the wheels fall off. But car buying is hardly ever a logical/rational decision otherwise we'd all be buying 2 year old 4 cylinder sub-compacts as a daily driver.

I simply tried to point out that in 3 years you're losing about 50% of your money, no matter whether you bought new or used. 50% of 30K is less than 50% of 60K, sure. But with the same logic everyone who spends $60K on a new MB should buy a 2 year old $120K car because it has even more prestige, luxury etc. To some luxury is in the fact that they can afford a new $60K car every two years with all the latest technology and safety features.

There is no money you can spend on a 2010 E-class that will get you BAS Plus or Active Steering Assist or Distronic Plus that works down to 0 mph.

Your opinion on what is "value" can be vastly different on what someone else considers a good value. A car is never an investment, it's an expense. If you could afford to lose $30K every 2 years on a car you would but you can only afford to lose $15K and you rather give up on the new car smell of a Camry and spend it on a used MB. Nothing wrong with that but the depreciation rate at 3-6 years is not much better than it is from 0-3 years.

There is an initial hit of 10% just by driving it off the lot but after that the rate is largely linear for the next 5 years (http://www.edmunds.com/car-buying/ho...fographic.html ) or 100,000 miles (http://jalopnik.com/a-simple-trick-t...our-1489099678). I'm willing to pay that 10% for the new car smell, for the notion that no other person drove the car before (as naive as that might be: http://jalopnik.com/meet-the-amateur...ew-b-513809077) getting a car exactly the way I want it without option sacrifices and getting the latest and greatest that automotive technology has to offer.

Your best bet is buying a Lotus Elise, driving it for 6 months then selling it for exactly what you paid for it because they cost $30K no matter what: http://plays-with-cars.kinja.com/i-o...you-1445088457 Too bad I can't fit two hockey bags and 7 people in this thing and I actually prefer creature comforts over road feel.

squareman

edited post

tdisedanman

A diesel variant will depreciate less.

GregTR

Yeah, sure, especially in Europe . Whatever you say, man... I personally think wagons hold their value the best, no personal bias in my opinion what-so-ever...