The Cost of Luxury: A Used Car Buyer’s Guide
Luxury cars and SUVs typically depreciate faster than their mid-market counterparts, presenting an opportunity for buyers who want luxury without the hefty price tag. For instance, Lincolns lose about half their value within the first five years, while a 2021 Ford retains around 60% of its value over the same period.
However, there’s a catch: luxury models are generally more expensive to maintain. According to RepairPal, the annual maintenance cost for a Toyota Camry is around $388, compared to $468 for a Lexus ES350. Therefore, when purchasing a used luxury car, it’s crucial to consider not just the initial cost but also ongoing expenses like maintenance and insurance.
Maintenance Costs: A Brand-by-Brand Comparison
Research from CarEdge provides insight into the maintenance costs of various luxury brands. Here are the findings:
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Annual Maintenance Estimate:
- BMW: $968
- Cadillac: $783
- Mercedes-Benz: $908
- Audi: $987
- Lincoln: $879
- Lexus: $551
- Acura: $501
- Genesis: $524
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Ten-Year Maintenance Estimate:
- BMW: $15,991
- Cadillac: $11,086
- Mercedes-Benz: $12,962
- Audi: $10,213
- Lincoln: $12,476
- Lexus: $7,130
- Acura: $8,566
- Genesis: $9,901
The data reveals that Japanese premium brands are significantly more affordable to maintain than their European and American counterparts. Acura stands out as the most affordable brand for annual maintenance, while Lexus offers the best long-term savings.
Insurance Costs: Another Key Consideration
Insurance costs also play a significant role in the overall expense of owning a used luxury car. According to CarEdge, the average annual insurance costs are:
- BMW: $4,554
- Cadillac: $3,005
- Mercedes-Benz: $3,561
- Audi: $3,503
- Lincoln: $2,998
- Lexus: $2,984
- Acura: $2,288
- Genesis: $3,360
Acura leads the pack with the lowest insurance costs, likely due to its relatively affordable pricing in the luxury market.
Depreciation Rates: The Final Piece of the Puzzle
Depreciation rates, as reported by CarEdge, vary across brands:
- BMW: 42.4%
- Cadillac: 43%
- Mercedes-Benz: 45.2%
- Audi: 39.2%
- Lincoln: 49%
- Lexus: 39.5%
- Acura: 46.2%
- Genesis: 46.1%
Acura depreciates faster than other Japanese luxury brands, making it a more affordable option in the used car market.
The Verdict: Acura Takes the Lead
Based on the data, Acura emerges as the top choice for used luxury car buyers. It offers lower maintenance costs, cheaper insurance, and significant depreciation. While Lexus is renowned for its reliability, its slower depreciation rate and higher initial prices offset its maintenance savings.
On the other end, BMW proves to be one of the more expensive luxury brands to own, with high maintenance and insurance costs.
Ultimately, the best luxury brand for a used car buyer depends on their priorities and budget. However, for those seeking a balance of affordability and luxury, Acura stands out as a compelling option.
