Re: BMW & Lexus Resale Value
hey marclees, I believe that the resale value of any car is generally dependent on the supply and demand. Seems obvious enough. But, look at resale prices this way: whatever you get for any car you sell, the price u get would be a combination of the paper value of the car plus the body value of your car.
Since the paper value is largely fixed, any "better resale value" would have to come from the body value. This body value is thus the variable component.
As with any variable component, most dealers work within a range. The more desparate ones (mabbe eager to close the trade in deal?) would obviously go nearer the deep end while the rest would not wonder off the average that one can get should he go to a few dealers.
Now, comparing between a BMW and a Lexus, the reason that some may think that BMWs give a worse resale is due to two reasons.
1. Supply and demand both in the local resale market and on the international export market. Cars that are on demand would generally command a higher resale price. (Put it this way, due to the more competitive pricing of a brand new lexus, it is easier to sell a 2nd hand lexus, which is cheaper, to people looking to enter the luxury car market than to sell a bmw which is more ex. This is also the reason why people who buy the highest spec/engine capacity cars are warned that this would affect resale: people who look for ex cars to drive, dun usually drive second hand cars.) Additionally, cars such as the RX are in high demand in places such as the middle east and in malaysia. Thus, more demand = better price.
2. The price premium charged by the car distributor over and above the paper value. The greater the difference, the more your car will depreciate per year. Lexus priced their cars very competitively. Thus, their margin per car is also lower. Thus, one would naturally get "better price" for their cars as their cars tend to depreciate less..
Hope this helps.
