Depreciation

[corkscrew]

Since an outrageous percentage of the purchase price of a luxury car goes into the coffers of the Thai government (customs, tax) does this mean that the depreciation percentage on resale will be that much less?

I have not had any expeience in selling my cars in Thailand but I would expect that the seller would expect to recapture most of his tax when he sold his car.

Let's assume Buyer pays 6 million baht for a car (and 3 million of that is tax). Further assume that he has to sell it shortly thereafter. My guess is that the depreciation would be largely tacked onto the body of the car and not the tax part.

Obviously if the tax/customs costs changed during the time Buyer owned the car this would have an effect.

[Tywais]

I doubt if the Thais consider them as separate issues. The amount they payed for the car is the value of the car regardless. Re-sell will be based on purchase price and buyer/seller perception of value.

Obviously if the tax/customs costs changed during the time Buyer owned the car this would have an effect

Always wondered about that too. Say you buy a car that has 50% tax then later the goverment removes all excise taxes on new cars it would mean the value of the car would be perceived as less (the re-sold car) because newer ones are cheap. I just contradicted my above response but only because it is hypothetical, doubt the gov will change this for a long time. There are certainly 'free zones' trying to be established but don't know when that will happen and to what degree.

Edited December 11, 2005 by tywais

[tom yum goong]

if you check out the second hand prices of imported cars, and compare it to the original price, you can see that depreciation is quite high. Some manufacturers more than others. 2nd hand Mercs can still be quite pricey, but a 2nd hand Peugeot can be a bargain.

whereas locally assembled Japanese cars depreciate very slowly. Toyota and Honda keep their value the best.

I'm not sure why this is. I suppose locally assembled cars are much cheaper to run and repair in most cases. Parts for European cars can be quite expensive.

[Thaiboxer]

I've always summed it up as this: Cars are more expensive to buy here but they depreciate more slowly than cars in the US. However, it's also cheaper to repair cars over here than in the States where labor is expensive. This is why many folks here (including me) drive these old tanks instead of sending them to the junkyard. I can see how Japanese cars would depreciate more slowly than the more expensive European models. On top of that, European parts are a lot harder to come by.

Edited December 11, 2005 by Thaiboxer

[YoungNRich12]

This is an old thread but I just searched the word depreciation.

Luxury cars in Thailand appear to depreciate just as slow as Honda/Toyotas.

A new SLK goes for 3.5m baht and a 10 year old one goes for 1.7m baht. That's pretty good.