K Car (케이카) recently revealed findings from an analysis of the resale values of 11 major popular models in the domestic used car market, assessing changes in their retention rates (the ratio of used car prices compared to new car prices) over a year. The study highlights that diesel and LPG models, known for relatively lower maintenance costs, exhibited higher retention rates, whereas gasoline models of large SUVs showed a decline in their resale values as of the 18th.
The resale rate of the Kia ‘Sorento 4th Generation’ showed significant variation: the ▲Diesel 2.2 2WD retained 78.8%, down by 5.2 percentage points from 84.0% a year earlier, while the ▲Gasoline 2.2 2WD fell sharply by 12.4 percentage points from 94.5% to 82.1%.
As time passes after new car release, the vehicle’s residual value typically declines.
In the used car market, the term ‘resale rate’ refers to the proportion reflected in the price at which a used car is traded compared to its new car launch price. For example, if the new car launch price of a specific model is 100, and the used car is traded at 70, this model’s resale rate would be considered 70%.
The higher the demand in the used car market, the higher the prevailing prices, resulting in a higher resale rate. Conversely, lower demand leads to increased depreciation and a lower resale rate. While variations exist by brand, it is generally noted that domestic vehicles experience a decrease of around -10 percentage points, while popular imported cars see around -15 percentage points over a year.
Looking at models considered steady sellers, they generally demonstrated a relatively small decline. Among domestic cars, ▲Hyundai Avante CN7 (Gasoline 1.6) -5.6 percentage points (83.9%→78.3%), ▲Hyundai The New Grandeur (Gasoline 2.5) -4.8 percentage points (81.5%→76.7%), and ▲Kia Morning Urban (Gasoline 1.0) -6.9 percentage points (76.2%→69.3%) showed minimal depreciation.
Vehicles with relatively lower maintenance costs managed to successfully defend their market prices amidst the ongoing high fuel price phenomenon experienced last year. Noteworthy LPG models include ▲Renault New QM6 (LPG 2.0 for general sales) -9.0 percentage points (79.7%→70.7%), and the compact SUV representative ▲Chevrolet Trailblazer (1.3 Turbo Gasoline 2WD) -9.9 percentage points (78.6%→68.7%), both reflecting depreciation marginally lower than typical levels.
Conversely, major models of large SUVs with low fuel efficiency exhibited relatively larger declines. With the consequences of high fuel prices and the release of successor models, ▲Hyundai Palisade (Gasoline 3.8 2WD) experienced a -12.2 percentage point decrease (78.4%→66.2%), while the ▲BMW 5 Series (G30) 530i M Sport saw a -13.8 percentage point drop (63.3%→49.5%), both hitting double-digit depreciation.
Lee Min-koo, head analyst of K Car PM team and adjunct professor at the University of Science and Technology, stated, “The resale rate of used cars is a significant indicator that shows changes influenced by the supply and demand dynamics in the market. Various factors such as new car launches, fluctuations in fuel prices, and export conditions all contribute to this.” He added, “If you’re considering buying a potentially interested vehicle as a used car, referring to these trends in market prices could be beneficial.”
Lee Sang-jin daedusj@autodiary.kr