The Depreciation On Hybrid Cars Is Lower Than Non-Hybrid Versions
When buying a car, it is always wise to pay attention to its resale value. Depreciation is a major factor that affects the value that you can expect when selling or trading in your car. In recent years, hybrid vehicles have become a preferred choice for buyers. But this poses a very relevant question: what will be the worth of this vehicle during a resale? The best way out is to find a car that has low depreciation and a high resell value. Thankfully, hybrids fit this description already. In a recent study conducted by Autolist, it was found that some models of hybrids have managed to retain their value much more than the gas-powered cars.
What Were The Findings Of This Study?
Autolist gathered the data for the vehicles from the model years 2013 to 2017. It focused on vehicles that had covered 100,000 miles or more. The rates of depreciation in 2013 varied largely for the gas and hybrid versions of the same car models. In fact, it revealed that hybrids from 2017 lost their value by 50.9 percent as compared to the non-hybrid cars that depreciated by 53.4 percent.
The data was collected for nearly 95 million vehicles. Interestingly, Toyota emerged as the strongest contender in this list. The hybrid models from Toyota exhibited an impressive resistance to depreciation when compared to their non-hybrid counterparts. The gaps were significant for the hybrid models of the Highlander in the SUV segment and the Camry in the sedan class.
The data for the 2013 Camry model year at 100,000 miles displayed the depreciation to be minus 61 percent for the hybrid model and minus 44 percent for the gas-powered model. The same stats changed dramatically during the model year 2017 when depreciation was minus 50.2 percent for the hybrid model while it was minus 50.7 percent for the gas version.
What Are The Reasons For This Change?
There are many potential reasons cited by experts for the leap in the resale value of hybrid cars. Most importantly, it is caused by technological advancements. With a focus on improving hybrid technology, manufacturers have been successful in improving the value proposition of their vehicles through a higher fuel economy.
The gap between the depreciated value of hybrid and gas-based models is also narrowing due to the rising popularity of hybrid models and vehicles that use alternative fuels. Customers are keener to buy next-generation technology including autonomous and electric cars. This shift in the mindset has opened new avenues of growth for hybrid models as well. Hybrid cars offer an opportunity to go green and save fuel in the longer run. With their success, they have emerged as a reliable option for consumers who were averse to the idea of integrating additional technology into the existing vehicles.
Apart from these, the demand and supply curve is also playing a crucial role in the valuation of hybrids. Despite growing demand, the manufacturing of hybrid car is going at a slower pace. They are less common and hence have a higher resale value. They can be a better investment as compared to non-hybrid models in the coming years.