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Depreciation the highest running cost?

By raccars Published

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When choosing a new car, running costs are a key factor in how the decision is made in the vast majority of cases. However, how many potential buyers also consider depreciation as one of these costs?

Fuel is generally considered the most important ongoing cost for car ownership. It's far higher than insurance unless you are a very young driver or have a heavy catalogue of offences under your belt, and both of these cost more than servicing and other maintenance. Depreciation accounts for larger sums than all of these. In fact, given two cars with otherwise identical running costs, taken over three years, depreciation can make a huge difference to what that vehicle costs you.

Consider, for example, the Volkswagen Up!, which apparently has the lowest running costs of any British car. Three years of Up! ownership costs about £10,100, based on an average mileage of 12,000 per annum. £3,414 of this (about 34%) goes on fuel. Over three years, about 15% is insurance, based upon a premium of £500 per year. Servicing and maintenance accounts for only 8% of the three year running costs, while the remaining 43% goes on depreciation - that's £4,335.

Bearing this in mind, time spent studying the best and worst cars for depreciation costs could save you a significant amount of cash. Currently, the car retaining its value better than any other in Britain is the Porsche Cayenne diesel, losing only 26.2% of its new purchase price over three years.

Next is the Range Rover Evoque in 2.2 eD4 five door format, losing only 31.2% of its new value three years later. Depreciation values are not based only upon model but also upon the detail, as the petrol version of the same car for instance loses a significantly higher 37.9%. A three door version of the diesel loses 35.9% over three years.

In fact, the list of the least depreciating cars in Britain is dominated by SUVs and specialist sports cars. Third place goes to the Audi Q3, fourth to the Porsche 911 Speedster, and in fifth place is the Kia Sportage.

At the other end of the scale, French manufacturers appear to be costing buyers a packet. The Renault Espace loses a frightening 87.4% of its new value in three years, with the Peugeot 407 and the Citroen C-Zero EV not far behind. The Chevrolet Lacetti is fourth on that ignominious list followed by the Vauxhall Astra Twin Top. Consider that before laying down your money...

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