Automotive

Car Depreciation Calculator

Calculate how much your vehicle loses in value over time and its current worth.

A new car loses about 20% of its value the moment you drive it off the lot, and 15-20% more per year. Understanding depreciation helps you make smarter buy vs. lease decisions and choose vehicles that retain value better.

Enter your numbers

Purchase Price ($)

Years Owned

Annual Depreciation Rate (%)15

Average: 15-20%. Luxury: 20-25%. Trucks/SUVs: 10-15%.

Results update as you change the inputs. Calculations run in your browser.

Current Estimated Value

$26,010

total Depreciation: -$18,990 total loss
cost Per Year: $6,330/year depreciation
five Year Value: $18,792 in 5 years

See the formula

Formula and method

Value = Price × 0.80 × (1 - Rate)^(Years - 1)

First year: 20% immediate depreciation. Subsequent years: compound annual rate applied to remaining value. The declining balance method reflects real-world automotive depreciation patterns.

Worked examples

New $45K SUV after 3 years

Purchase Price ($):: 45000
Years Owned:: 3
Annual Depreciation Rate (%):: 15

Current Estimated Value: $26,010

Luxury sedan $75K after 5 years

Purchase Price ($):: 75000
Years Owned:: 5
Annual Depreciation Rate (%):: 22

Current Estimated Value: $22,209

Assumptions and limits

Average mileage (15,000-20,000 km/year)
No major damage or accidents
Normal market conditions

This tool provides an educational estimate. Rules, rates and personal circumstances can change the answer. Review the assumptions before relying on a result. Report a correction.

Common mistakes to avoid

Using purchase price (with dealer markup) instead of MSRP for depreciation calculations.
Ignoring mileage — above 15,000 km/year accelerates depreciation by 1-2% per year.
Assuming luxury cars depreciate the same as economy cars — luxury vehicles lose value faster.

Frequently asked questions

Which cars depreciate the slowest?

Toyota Tacoma, Jeep Wrangler, Honda Ridgeline, and Toyota 4Runner consistently have the lowest depreciation rates (8-12%/year). Trucks and Jeep Wrangler often retain 60-70% of value after 5 years vs 40-50% for average sedans.

Is leasing better than buying given depreciation?

Leasing transfers depreciation risk to the dealer — you pay only for the depreciation during your lease term. If you drive 20,000+ km/year, frequently want new vehicles, or want lower monthly payments, leasing can make sense. Buying is better for long-term ownership (7+ years) and high mileage drivers.

When is the best time to sell a car?

Before the warranty expires (typically 3-5 years), before major service intervals (60,000-100,000 km), and in spring/summer when demand peaks. The sweet spot is often 3-4 years, when most of the steepest depreciation has occurred but the car is still desirable.