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High Miles On Used Cars A Bigger Turnoff Than Condition

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What causes a particular vehicle to depreciate more than another of the same make, model, and year?

According to ordinary car shoppers, vehicle mileage is seen as the top reason for depreciation, ranking above accident damage, maintenance records, and other issues such as flood damage or title issues.

The surprising results come from a quick survey of 1,000 U.S. adults, conducted in June by Ipsos Public Affairs on behalf of the mega-dealer CarMax.

The most interesting tidbit: Women were more likely to recognize the impact that failure to properly maintain a vehicle can have on its value.

In a release, the company suggests that consumers might be confused by the factors that may play a role in depreciation but doesn’t give suggestions on the real order of such factors. Those who have shopped used cars in recent years are likely aware that vehicles with flood or salvage titles are in some cases difficult to properly register and insure and generally worth a small fraction as much as an equivalent vehicle that, for instance, has high miles and has been well maintained.

Market realities also have a larger role in depreciation and resale value than this cursory poll suggests. Last summer Automotive Lease Guide, one of the leading providers of residual value forecasts used in determining lease values and depreciation, announced a repositioning of its residual values of fuel-efficient vehicle due to a change in shoppers’ priorities in the face of $4/gallon gas.

For your entertainment, but definitely not for your education, here are the general public’s perceived causes of depreciation:

Vehicle mileage – 33%
Accident or Frame Damage – 24%
Keeping Up with Regular Maintenance – 22%
Current Market Data – 12%
Flood Damage – 7%
Title Issues – 2%

 
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