There are endless compelling reasons why you should buy a truck. They are multi-purpose and have lots of cargo space — plus, you can always use them to tow your boat! But before completing that purchase, it’s really important to know whether they are a good investment.
And for every potential car owner, this means considering their depreciation rate. Here’s a question for aspiring truck buyers: Do trucks hold their value better than cars?
Trucks Vs. Cars: Depreciation Comparison
Trucks are built differently, and each model will depreciate differently from the other. Generally, though, a truck will lose 15% to 25% of its value a year in the first five years. This depreciation can be broken down into three time periods:
- 20-30% for the first year.
- 10-15% in the second to fourth year.
- 40-50% after five years.
Similarly, different car models will depreciate differently. On average, a car will depreciate between 15% to 25% every year for the first five years.
From this, you can note that the depreciation pattern for trucks and cars is slightly different. The first year sees the highest dip in value. Trucks will lose 20% to 30% of their original value in the first year, while the figure can be as high as 40% for some cars.
The following years see the depreciation rate slow down for both cars and trucks — 10%-15% for trucks and a constant 15%-25% for cars. After five years, a truck will have lost 40% to 50% of its original value, while a car will have lost around 60%.
Again, it’s important to note that these figures will vary depending on the vehicle’s model, make, and mileage, among other factors.
5 Reasons Why Trucks Hold Their Value Better
So, why do trucks hold their value better than cars?
They are for work
Luxury vehicles depreciate the most. And you’ve got to admit, trucks aren’t the flashiest or most glamorous automobiles around. Most of them are designed for a work setting and that means two things.
- They’re designed with durability in mind
- They are built to last
Because of this, trucks are always in demand from people and companies who want to use them for work. Remember, longevity is essential when determining the resale value of a vehicle.
Multi-purpose vehicle
When you’re not busy using your truck for work and making money with it, they come in handy on the weekends for family activities like towing a jet ski or taking a long road trip. That’s the beauty of trucks. Whether it’s for basic transportation or professional business, they are always up for the task.
In addition, trucks can be outfitted with various accessories: bike racks, construction equipment, and rooftop tents — you name it. Not all cars can do this. It’s easier for a truck to replace a sedan and an SUV than for the two to replace a truck.
Leased the least
Most people will buy a truck instead of leasing one. Part of this is because they are meant for business and they may either have higher mileage at lease end time or have more damage than most other vehicle types. In addition, truck owners tend to hold on to their trucks for longer, ideally 5 to 10 years. This results in a low amount of inventory ready to be bought on the used car market.
Trucks that are resold after a year or two are normally in high demand, meaning they can fetch nearly as much as a new model.
Ideal for off-road adventures
In the same way that trucks are designed for multi-purpose use, they are also suited for different terrains. Features like four-wheel drive, high-performance suspension systems, and locking differentials enhance a truck’s performance off-road.
Trucks’ high ground-level clearance enables them to maneuver challenging terrains with ease. Obstacles that would be impossible for a standard car are attainable with a truck.
Top Trucks that Depreciate the Least
Which truck has the best resale value? This coveted position goes to the Toyota Tacoma, and this doesn’t come as a surprise. The Tacoma has had the best resale value for almost two decades now, and that doesn’t seem likely to change.
It has everything you’d want in your truck. Its engine is powerful, it’s durable and reliable, plus it looks good. It will retain almost 70% of its original value after 5 years.
The Toyota Tundra comes in at a close second, giving the Tacoma a run for its money. Toyota is known for engineering some of the best automobiles on the market.
Here’s a list of trucks with the highest resale value.
- Toyota Tacoma
- Toyota Tundra
- Nissan Frontier
- Ford F-150
- GMC Sierra 1500
- Honda Ridgeline
- Chevrolet Silverado 1500
- Ram Pickup 1500
Trucks are undoubtedly better than cars in terms of resale value for a number of reasons, including utility, versatility, and durability. They are also built to last, making them appealing to a number of buyers.
The ultimate choice between a car and a truck narrows down to personal preference, but if resale value is a top priority, trucks are a wiser investment. Use Motobyo to get an estimated cost of your truck before buying or selling it and ensure you get the best price possible!
