On average, redesigned vehicle models experience higher retained values when compared to the previous generation. A number of factors help elevate retention value for new or revised models — factors such as improved quality and dependability, higher fuel economy, and optimized performance, as well as improved vehicle design. Other important factors affecting retained value include new vehicle pricing, incentive levels and production volume.
High-value-retaining models offer unmistakable benefits to automakers and consumers alike. Strong retention gives manufacturers competitive cost-of-ownership and leasing advantages (high retention equals lower lease payments), while it allows consumers to accrue positive equity more quickly than otherwise. This ultimately improves a consumer’s purchase power when it’s time to buy his or her next vehicle.
NADA Used Car Guide has just released a report detailing the one-year-old (2016 model year) retention performance of all-new or redesigned mainstream and luxury models. The retention calculation used in the report is a function of the most recent three-month average of NADA Used Car Guide’s average trade-in value divided by a vehicle’s typically-equipped manufacturer’s suggested retail price (MSRP). Note that a vehicle’s rate of depreciation, and ultimately retention, is in part a product of the level of discounting when new. As such, MSRPs do not include any incentives or rebates available at the time of purchase.
Additionally, one-year-old 2015 model year retention data from last year is provided to compare the percentage point change between revised 2016 models and previous-generation 2015 models. In some cases, 2015 and 2016 model year vehicles were omitted from this report because average trade-in values were not yet available during the selected analysis periods.
