Loss of value on new car per year?

[PAV123]

Does anyone have an idea of how much value loss you have per year on a new car in Thailand?

Where is the "sweet spot" of buying a used car? 1-2-3-4-5 years old?
And how long should you keep the car, to minimize value loss? 1-2-3-4-5 years?

[DavisH]

Resale depends on the model. For example, the honda jazz loses value very slowly. 

 

Consider buying new. Read the thread about the owner of second hand civic - it had apparently been in a bad accident and written off. It was rebuilt and sold to the new unsuspectign owner. So tread carefully. Only buy second hand if you know the previous owner and the cars history, or there is some kind o guarantee the car has not been in a major accident. 

[Kwasaki]

My observation is two fold :-

Buy a vehicle new but keep it if you buy via finance.

Buy secondhand vehicle 3 years or older with cash.

[foreverlomsak]

29 minutes ago, PAV123 said:

Does anyone have an idea of how much value loss you have per year on a new car in Thailand?

Where is the "sweet spot" of buying a used car? 1-2-3-4-5 years old?
And how long should you keep the car, to minimize value loss? 1-2-3-4-5 years?

The difference in price of a 2 year old versus a 5 year old is negligible, to a 10 year old only slightly better, the second hand market here is funny compared to the UK second hand market. Cars retain their value better for some reason even though in the last 10 years the amount of second hand cars available has probably quadrupled.

Edited December 18, 2020 by foreverlomsak
Brain working quicker than fingers

[HAPPYNUFF]

The car dealers  rule of thumb for   buying a new  vehicle is  (   convert these amounts    to your own countryes money for comparison)

 

When you buy a new vehicle, immediately   reduce its value by $5000

Every year thereafter, reduce its value by a further $2000

 

For instance,, you bought a new car for $25,000

Its new   five years old,,,       take off $5000, then another   $10,000.

Its now, allegedly, worth  $10,000.

 

I  was told this by several   used, and new car dealers, in my home country,  seems   applicable here.   Dont forget  this is for vehicles in    good condition on trade in.

[kingstonkid]

The big difference is the weather.  Thetis no winter here this cutting down on body rust. I do agree though that while buying new is a good thing you will lose 25% of value driving it off the lot

 

[tonray]

I was quite surprised..my GF recently (last week) sold her 2012 Mitsubishi Mirage as we replaced it with a 2020 Mazda 2. She had two competing offers, one from the  guy referred by the Mazda dealership and one from some guy her cousin works with. Both were for 135,000 baht which is about 50K more than I would have guessed. Car was in good shape with 112K on the odometer. The guy her cousin knows says these older small cars are in great demand in Issan as used cars are harder to come by. He buys them up here and sells them pretty much unaltered to young guys in Issan who them will put loud exhaust systems and bigger tires on and run them into the ground.

 

I think the car was purchased new in 2012 for about 450,000....so 135,000 eight years old is pretty good deal IMHO

[vinny41]

1 hour ago, kingstonkid said:

The big difference is the weather.  Thetis no winter here this cutting down on body rust. I do agree though that while buying new is a good thing you will lose 25% of value driving it off the lot

 

I have seen mutiple reports of rust on cars in Thailand so rust is still an issue some models were more prone to rust than others

[Salerno]

1 hour ago, kingstonkid said:

I do agree though that while buying new is a good thing you will lose 25% of value driving it off the lot

 

Damn inflation sucks, I always thought the rule of thumb was 10%.

[Pilotman]

most people do not do a 'whole life costing' calculation when buying a new car.  A company does such a calculation, or should do, with all new assists ,.including company vehicles.   This can greatly influence what your perceived  annual loss on resale is  on a vehicle. As you would expect, my UK, BMW, WLC was astronomical, although the second hand price was reasonably high.  My Vios here is minimal, although it has maybe halved in cash resale value over 3 years. Conclusion, buy a much cheaper car here and either sell it after 3/4 years or run it into the ground.   

[patman30]

Cars here used to hold their value much better than today
the value of the car can also depend on the previous owner(s)/condition of car
you may find cars that are 3-5 years old (finance all paid) with 1 previous onwer
will be priced better, as most cars here new and used are purchased with finance
and the seller needs to pay the finance when selling
avoid dealers and buy direct from 1st owner

If considering buying a car now
do be aware of the big push for EV's coming soon globally
personally i will not buy a new car again
due to EV's becoming the norm in a few years time
so anything you buy now, could just be scrap value in a few years

one fun fact which may help
Honda's have the least insurance claims (i do not own a honda)
 

[Ireland32]

On 12/18/2020 at 11:32 PM, DavisH said:

Resale depends on the model. For example, the honda jazz loses value very slowly. 

 

Consider buying new. Read the thread about the owner of second hand civic - it had apparently been in a bad accident and written off. It was rebuilt and sold to the new unsuspectign owner. So tread carefully. Only buy second hand if you know the previous owner and the cars history, or there is some kind o guarantee the car has not been in a major accident. 

Never buy Thai second hand find a Farang just be careyfaramg not con ya , too, also Thais pretty much only like Honda and Toyota as reliable 2 Nd hand I heard Izuzu is a close 3rd

Edited December 21, 2020 by Ireland32

[canthai55]

1 hour ago, Pilotman said:

Conclusion, buy a much cheaper car here and either sell it after 3/4 years or run it into the ground.   

Agree - only way to maximize your investment is to do either.

Always been a run-it-into-the-ground kinda guy !!!

Many many good deals on second hand cars now.

If you know cars and what to look for you can do great.

[JBChiangRai]

It can also depend on the model. The sweet spot on a Suzuki Ciaz is one year old.  I bought the top model RS model at 10 months old for 55% of new price, 2 years later it’s worth 85% of what I paid for it.

 

I also bought an AMG E class at a couple of months old as a demonstrator with 1,500 km on it at 20% discount from list, I’ve lost about 1 million baht in 2 years since then, but the car has only covered 14,000km and never goes out in the wet.

[khunPer]

I new car loose a lot immediately when registered first time, it's the first two year you have a great loss, in total around 30 percent to 35 percent, if you count of what the 1st class insurance will pay for a total damage for a 2 year old car. Thereafter, as labor cost is cheap in Thailand – and of course no winters compared to cold countries – cars holds their value quite good, but depending of model and popularity. A 7 to 8 year old car is insurance valued at around 40 percent to 50 percent of the original new price.

 

I would say 6 to 7 years – or even longer, depending of car model and condition – to minimize loss.

 

As comparison my first car in Thailand was an almost 11 year old Jeep Cherokee, which I drove in about 8 years, and got 40 percent of my buying price back when I resold it; by that time some major age repairs would be due, or soon due. 60 percent loss in 8 years in average equals around 7.5 percent loss of buying price per year for an aged car...????

[allanos]

Too many variables, including make and model, but, in general, a new car loses around 25% of its sticker price when you drive off the showroom floor.

 

However, most buyers don't consider the depreciation factor when they buy new; they are "sold" on a particular marque preference, or enticed by the largest discount offering, and do not take into account how both of these will affect the ultimate resale value.

 

In my opinion, better value is locked in by buying a good late-model vehicle, where first-time discounts and first-year depreciation are largely already factored into the second-hand price. The unexpired portion of the maker's warranty, and service history of the subject vehicle, is also worthy of consideration at this time.

[allanos]

Posted twice. Second content removed.

Edited December 21, 2020 by allanos
typo

[PGSan]

FWIW:  With one very bad exception, every car I have ‘owned’ here was bought new, run for 8-10 years and relatively few km, then sold for approximately 25% of the price it was bought for.  All were locally built, small-medium sized hatchbacks or low-end SUVs retailing at 700,000 to 1,500,000.

[Andy from Kent]

4 hours ago, Pilotman said:

Conclusion, buy a much cheaper car here and either sell it after 3/4 years or run it into the ground.   

 

Probably  good economic advice but who wants to drive around in a cheap car that lacks comfort?

 

[Pilotman]

24 minutes ago, Andy from Kent said:

 

Probably  good economic advice but who wants to drive around in a cheap car that lacks comfort?

 

many of the cheaper range of cars, Vios and Yaris for example, are very nice to drive and are indeed comfortable. 

[Chungju]

My rule of thumb is that the value will drop pretty much linearly (except the moment you drive it out from showroom when new) to half in 5 years and half from that again in another 5 years. So in other words 5 years old is 50% of the new price and 10 years old 25% if the new price.

[natway09]

25% when picking car up,,, 10% a year as a rule of thumb

My Honda civic is now at minus 15% 555

[transam]

I bought a new 2007 Vigo G 4x4 with auto, cost new 850,000bht, kept it 11.5 years.

Put it out in the media for 390,000bht, many offers from tents without looking at it at 300,000bht.

Bloke turned up offered me 350,000bht, I said, no, but if you put 370,000bht in my bank 'now' you can take it..

 

He took it......????.......They like those Vigo 4x4 autos...

 

 

 

 

 

[DavisH]

8 hours ago, JBChiangRai said:

It can also depend on the model. The sweet spot on a Suzuki Ciaz is one year old.  I bought the top model RS model at 10 months old for 55% of new price, 2 years later it’s worth 85% of what I paid for it.

 

I also bought an AMG E class at a couple of months old as a demonstrator with 1,500 km on it at 20% discount from list, I’ve lost about 1 million baht in 2 years since then, but the car has only covered 14,000km and never goes out in the wet.

The ciaz is a bit of an enigma. Resale is really low compared to the comparative suzuki swift. 

[DavisH]

3 hours ago, Chungju said:

My rule of thumb is that the value will drop pretty much linearly (except the moment you drive it out from showroom when new) to half in 5 years and half from that again in another 5 years. So in other words 5 years old is 50% of the new price and 10 years old 25% if the new price.

exponential decay in resale. You should beavble to get a few baht for it in a 1000 years lol

I paid about 990K for a civic in 2004. 15 years later sold it for about 230K. So not too bad. Some 25 year old eg 3 door civics sell for 200-300K. ridiculous prices. 

[vinny41]

Chevrolet Thailand says ‘no’ to compensation demands for cars sold before discounts were announced

Chevrolet cut prices in half to clear stocks of more than 4,000 vehicles in Thailand. The cost of a Captiva LS dropped from 999,000 to 499,000 baht and the LT models from 1.099 million to 599,000 baht.

https://thethaiger.com/news/business/chevrolet-thailand-says-no-to-compensation-demands-for-cars-sold-before-discounts-were-announced

 

I am sure this has had a big impact on the 2nd hand market for the owners that paid full price

[DavisH]

2 hours ago, transam said:

I bought a new 2007 Vigo G 4x4 with auto, cost new 850,000bht, kept it 11.5 years.

Put it out in the media for 390,000bht, many offers from tents without looking at it at 300,000bht.

Bloke turned up offered me 350,000bht, I said, no, but if you put 370,000bht in my bank 'now' you can take it..

 

He took it......????.......They like those Vigo 4x4 autos...

 

 

 

 

 

Dead easy to sell toyota pickup privately. Yep tent offers suck and they have gotten worse over the last 5 years due to the glut in the market.

[JBChiangRai]

16 hours ago, DavisH said:

The ciaz is a bit of an enigma. Resale is really low compared to the comparative suzuki swift. 

That’s why I bought it, I use it when it might rain or on unmade roads. The Suzuki Swift is much more popular, has the same engine/gearbox but is in a smaller segment.  The swift also lacks leather and climate with heater - important in Chiang Rai! 12°C this morning!  The Ciaz is a terrible buy new but an excellent buy at 1 year old.

[PGSan]

23 hours ago, Chungju said:

My rule of thumb is that the value will drop pretty much linearly (except the moment you drive it out from showroom when new) to half in 5 years and half from that again in another 5 years. So in other words 5 years old is 50% of the new price and 10 years old 25% if the new price.

Pretty close to my data!

[Surelynot]

Typically you can expect to lose 50% of its OTR price within three years......IME