Most Important Factor When Comparing Two Vehicles

The largest cost of buying a car is the depreciation cost. Unlike a home, cars do not tend to increase in value - instead, they lose about half their value in 3 to 4 years.

For a $30,000 vehicle, that adds up to $5,000 in depreciation cost PER YEAR.

The biggest factor affecting depreciation is the quality and consumer perception of the vehicle. The better its quality, the more likely consumers will be willing to pay more for it as a used vehicle. Another benefit of a high quality vehicle is lower repair and maintenance costs.

When comparing two vehicles, it's not always the case that the less expensive model will end up costing you less over the life of the car. It's important that you get a feel for the quality of the vehicle and it's expected residual value down the road. One way to do this is to take a look at the annual J.D. Power & Associates ranking of initial quality and long-term dependability.

Each year, J.D. Power surveys several thousand new car owners and keeps track of any defects or problems reported. In the initial quality survey, they find out the problems owners experienced within the first 90 days of ownership.

Here is a recent example of the "Initial Quality" rankings showing the number of problems expreienced per 100 vehicles.

In the long-term reliability rankings, J.D. Power keeps track of the number of problems experienced over several years of ownership.

It's a good idea to keep these rankings in mind when trying to decide between two different vehicle brands. As for individual models, the following are high quality vehicles that - on average, will retain their residual values better than most vehicles:

Highest Quality Vehicles

• Acura TL
• Audi A4
• Audi A5
• Audi S5
• BMW 1 Series
• BMW 3 Series
• BMW 5 Series
• BMW X5
• BMW Z4
• Buick Regal
• Chevrolet Camaro
• Chevrolet Corvette
• Chevrolet Traverse
• Ford Fiesta
• Ford Flex
• Ford Mustang
• Ford Shelby GT500
• Ford Taurus
• GMC Acadia
• Honda Accord
• Honda Civic
• Honda Civic Hybrid
• Honda CR-V
• Honda CR-Z
• Honda Element
• Honda Fit
• Honda Insight
• Honda Pilot
• Hyundai Equus
• Hyundai Sonata
• Hyundai Tucson
• Infiniti G25
• Infiniti G37 Coupe
• Infiniti G37 Sedan
• Infiniti QX56
• Jaguar XF Series
• Jaguar XJ Series
• Jaguar XK Series
• Kia Sportage
• Land Rover LR4
• Land Rover Range Rover
• Land Rover Range Rover Sport
• Mazda Mazda3
• Mazda Mazda6
• Mazda Mazdaspeed3
• Mercedes C-Class
• Mercedes E-Class
• Mercedes M-Class
• Mini Cooper
• Mini Cooper Clubman
• Nissan 370Z
• Nissan Cube
• Nissan GT-R
• Nissan Rogue
• Nissan Sentra
• Nissan Versa
• Scion xB
• Subaru Forester
• Subaru Impreza
• Subaru Legacy
• Subaru Outback
• Toyota Camry
• Toyota Camry Hybrid
• Toyota Sienna
• Volkswagen Eos
• Volkswagen Golf
• Volkswagen Jetta
• Volkswagen New Beetle Conv.
• Volkswagen New Beetle Coupe
• Volvo C30
• Volvo C70
• Volvo S60
• Volvo XC60