Elise and I recently went on a hike with another couple, and on our way up the mountain I learned from the guy all about how his car has lost $50 grand in value over just a few years. I didn’t think much of it; lots of cars have seen heavy depreciation, especially lately, so I figured he was just exaggerating. But then, when I got home, I recalled the conversation and decided to look up his car: A 2019 Audi E-Tron. And my god was I shocked with what I saw.
Depreciation is a part of life if you buy a new car, with a few exceptions like the Jeep Wrangler, Toyota Tacoma, and pretty much anything bought just before COVID and sold during that car-market nightmare. Among the worst cars when it comes to depreciation are expensive European cars. Buy a new Mercedes S-Class, for example, and you can expect to lose many tens of thousands of dollars in a really short span.
Another segment of the car market that has seen humongous depreciation is electric cars. So what if you blend 1. Expensive German Car with 2. Electric car? Well, you get a depreciation To The Max.
The headline of this article isn’t meant to be a joke, because people losing tens of thousands of dollars is no laughing matter. It can have a huge effect on someone’s livelihood if they end up buying a car whose value tanks just before they have to sell. On one hand, the cars that are depreciating worst are the ones purchased by folks who, at least in theory, can most afford it. On the other hand, I can see how this could blindside someone.
I mean, just look at the reviews of the Audi E-Tron when it came out in 2019; anybody would have thought they were buying a state-of-the-art machine. Motor Trend‘s headline was: “2019 Audi E-Tron Review: What a Way to Glide” and its subheading was “The EV wars are starting in earnest, and Audi has itself a real weapon.” Here’s how Motor Trend described how the E-Tron compared to others in its class, and even described it as “affordable”:
In the showroom wars, the e-tron’s primary enemies are the aforementioned I-Pace and Tesla’s Model X, as well as Mercedes’ upcoming EQC. A little smaller and pricier but quicker and more responsive, the Jag boasts an EPA range of 234 miles. The Model X is by far the costliest of the bunch—when you add desirable options it can soar well past $100K—but it’s also by far the quickest, as it can sprint from zero to 60 mph in 2.8 seconds with the extra-cost Ludicrous Mode. The Tesla also leads with a maximum claimed range of 325 miles. The e-tron, in contrast, is the most “normal” of the trio. Excepting the Mercedes, which starts at $68,895, it’s the most affordable with a base sticker of $75,795, offers a generous 57 cubic feet of cargo space with the rear seats folded down, and while it may not deliver the sizzling straight-line acceleration of the Model X or the halfback-like chassis moves of the I-Pace, it’s designed to charge quickly, glides over the road with unfailing refinement, and is built with battery longevity and unflagging performance as priorities.
CNET’s review was similarly glowing:
In that spirit, today I’d like to celebrate the $74,800 Audi E-Tron, a car I’ve been appreciating for nearly two months now. Audi’s first production electric car takes a subtly different but distinctive path to all-electric glory. There’s nothing ludicrous about this EV SUV and, frankly, I couldn’t care less what its Nurburgring lap time is. What I do know is that this is among the most comfortable, most soothing cars I’ve ever had the privilege of driving, and that makes it something special.
[…]Configured this way, at $77,290 including destination, this is not a cheap car. But it offers luxury appointments on par with similarly priced premium machines, plus the added benefits of that smooth, quiet, maintenance-free EV lifestyle.
It’s hard to argue with this practicality or with Audi’s wholly rational approach to building an EV. The e-tron is a competent, well-engineered piece that makes few compromises compared to Audi’s gasoline-powered SUVs. But at this point, buying an electric car—especially one that starts at $75,795—is still a bold, somewhat irrational choice, a decision to go against the grain…. But we’re not far enough into the EV era to know what’s right and wrong….
The Tesla Model Y launched just a few months after the Audi E-Tron, and then as other competitors like the Kia EV6, Hyundai Ioniq 5, and a boatload more joined in on the fun, prices tanked. Some of this is a result of EVs being seen as appliances whose value is determined predominantly by a single attribute (range), some of it is a result of early adopters having already bought their EVs and skeptics hesitating to make the plunge given infrastructure issues, part of it is a result of political uncertainty/rebates, and part of it is a result of the crazy price-cuts from Tesla.
In any case, look at what a 2019 Audi E-Tron — whose MSRP was $75,795 for the Premium Plus model and $82,795 for the Prestige model — costs nowadays:
Those cars only have about 50,000 miles on them, meaning they’ve lost over a dollar a mile! My god, a dollar a mile. If I knew my car would lose a dollar of value every mile I drove it, I’d sell it immediately. Check out the value trend over time:
Especially in the last couple of years, after the post-pandemic price-jump, the market has not been friendly to the E-Tron:
It’s worth pointing out that E-Trons and other EVs were eligible for the $7,500 EV rebate. Not to mention, I bet plenty of these were leased, and others were sold with money on the hood. But for those who bought them outright in 2019, even with the EV rebate: Yikes!
Here’s the gasoline-powered Audi Q7, for reference:
Now, you might be thinking that lots of expensive German cars depreciate a lot, and that’s definitely true. A 2022 Mercedes S-Class started between $110,000 and $120,000, and look at how cheap they are now:
That’s about 50 grand in just two years and 35,000 miles! Yikes! But even the mighty S-Class has nothing on the electric version of the S-Class, the EQS. That car started at $102,310 for the EQS 450+ and $119,110 for the EQS 580 4MATIC. (Less the EV rebate).
Now let’s have a look at what these machines are trading for:
That’s among the cheapest ones I’ve seen. Only $39,000 for a car that started at over $100 grand just two years prior! Surely this thing is flying off the shelf, right?
Apparently not! Here’s another EQS that lost 60 grand in 40,000 miles ($1.50 a mile):
And here’s an EQS 580 for good measure (this one actually being sold by a Mercedes dealership). These started at over $119,000, so this is also a car that lost over 60 G’s:
Just look at the pricing trends of the EQS:
Here’s
Here’s the S-Class, in case you’re curious (sorry about the scale from Cargurus):
As you can see, those expensive German cars are depreciating quickly, but the electric expensive German cars are losing value violently.
Yikes!
Thank goodness so many of these were leased or purchased with lots of money on the hood, and hopefully all of them got the $7,500 federal rebate, along with a potential $4000 rebate for the buyer of the used car (though that only applies to sub-$25,000 vehicles).
All Images: Cargurus (Unless otherwise specified)
This is the equivalent of buying something on a yard sale, cheap and working ok
E-tron is a lovely machine and a terrible EV. EQS is a pretty decent EV but a styling mess. Both were first cuts at a new market by established luxury players and were unpopular when new. These vehicles are still being punished for their original sins.
I’ve only seen press photos of the EQS up to this point, but seeing the silver dealership photo…woof.
Not offensively bad, but I could honestly see it being sold with a VW badge for $50k. We complain about cars being over-designed, but there’s also a lower limit if the shape of the car itself is boring.
Logging in to the site is a disaster.
I can’t do it at all on my antique iPhone (which is the only device that I can access my personal e-mail on), and this time I’ve logged on using my work computer, which I’m not doing again and took forever and still isn’t showing me logged on as me.
What’s the e-mail for tech support?
Agreed. Since the “upgrade” it just keeps getting worse. First it was slow loading but now it makes you sign in every time you load a new article and many if those LogIns fail. Have you guys ever heard of a “sand box” to try out new site features before going live?
You don’t just put the fish in the new tank and hope for the best; you test the tank BEFORE putting the fish in it to make sure it’s safe for them.
They seemed to have skipped this step.
It seems the cookies are buggered or the authentication engine is taking way too long to respond. Sometimes it knows I’ve logged in, sometimes it doesn’t. Happens with multiple browsers. It’s amateurish and borderline unusable. For a professional website this situation should be a 3 alarm fire.
“it’s amateurish and borderline unusable. For a professional website this situation should be a 3 alarm fire.”
Dude, you’re spot on!
My subscription is due to renew in 3 weeks and I have my reservations about renewing until the stability/functionality of this site is restored.
Yep, it is maddening!!!!!!!!!!!!
(I am having the same website issues you have mentioned)
“You are logged in as Jesus Chrysler drives a Dodge”
Am I though?
I went to Jalopnik today for the first time in months. It was dreadful, obvs, but at least I wasn’t expecting awesome and getting multiple redirects to a page I can’t log in on.
I know you’re wondering “how dreadful was it?”
A list of American to English translations of automotive terms, written by an English guy who got some of the English ones wrong.
Presented as a slide show.
My little alarms don’t clear any longer either.
I am posting this comment after spending 25 minutes of trying to log in to my account! it took 6 attempts! This websites functionality has turned to trash since the “upgrade” 🙁
Just know that this is our top priority at this time. Our sincerest apologies; we’re going to get this place patched up as soon as humanly possible.
Us fellow subscribers, would appreciate that. David!
Thanks for acknowledging. We understand it is difficult and we’ve got your back. And hey, at least it’s not Kinja!
IKR
Wait,these are used retail prices right? Surely the owners were given MUCH less than this as a trade in?
Please tell i’m wrong,because frankly that’s horrifying
You’re not wrong….and this is why so many people who know the industry highly advise not to purchase a new EV right now, and only lease if you’re interested. Early adopter, FOMO new tech syndrome.
That’s fine I guess but some rich moron has to do it so there can be a CPO one in 3 years. What happens if nobody buys it new?
Leases are one of the biggest sources of CPO vehicles…so….no change, people are just smarter to lease an asset that depreciates more steeply compared to the rest of the market than buying one.
Yes these cars can be bought relatively cheap .Maintenance and parts for these cars make them very expensive to own .Average people have figured this out long ago so there’s not much of a secondary market for them.
Prices go up, everyone complains.
Prices go down, they still complain.
Personally I’d like to see the prices of EVs go down a lot more. Smaller, lighter, and simpler too.
What really needs to be addressed is that the cost to repair and thus to insure cars has gone up way up, mostly due to there being no incentive to design for reparability. Embedding cameras and sensors into the windshield , who thought that was a good idea?
We don’t need to know how many squirrels are finding their nuts 4 miles down the road guys.
The point here is not really that these people have lost money. They don’t lose anything unless they sell.
The point is that I/we can have same thing as them, for about 27% the price, by just waiting a few years.
Buying highly depreciating assets new is, relatively, an expensive lifestyle.
This is a great point. I’ve ogled W220 S-Classes for years, gazing longingly at the beautiful lines, sumptuous interior, and silky V8, all for just a few grand- the same as a Ford Fucking Taurus in similar condition. Then reality smacks me in the face, and I remember that this car would end up on jackstands in my garage.
As the old adage goes, “the most expensive (insert luxury car here) is a cheap (insert same luxury car here)”. Cheaper purchase price does not track cheaper maintenance or insurance.
I read an article that said the best deal with an EV was to lease it, or buy a used one. The first option won’t work for me as I drive more than 20k mi a year. Used…I don’t really like the idea of owning someone’s seconds. So in the meanwhile, I’ve suffered the depreciation of two EVs (granted, neither was a German luxobarge).
On the other hand, your own firsts will become your seconds too, once you’ve owned the car for a while.
If you don’t trust it after someone else has owned it, why would you trust if more after you’ve owned it for the same length of time?
I’d trust a used EV more than I’d trust an ICE one. The used EV is mostly about battery health, which it will tell you through its own self-check, with an ICE it’d take a lot of work to try to find the effects of improper break-in, delayed oil changes, using the wrong oil etc. (unless the effects are borderline catastrophic, of course)
Because I know how I’ve treated it, and what it’s been through. I have a Leaf, and I can count the number of times I’ve used a level 3 charger on one hand. Zero hands for how many times food has been eaten in it.
On the other hand, I’ve bought 8 different used cars over the last 24 years, and I’ve never had any issues beyond normal wear and tear. It’s generally pretty easy to inspect and see if the car has been cared for or not.
But each person will have their own assessment of how much they are willing to spend to buy down risk.
In some cases, even with the excess mileage charge that you have to pay when you turn in the lease, you still might come out ahead over owning, it’s that big of a difference these days.
On one hand, I do feel kind of bad for the folks who went out and bought EVs early on. But on the other…anyone who can afford to drop $80-$100,000 is probably going to be just fine, and if you dug any deeper than surface level lots of folks were saying to lease them even way back then…and there aren’t very many excuses to buy a car without doing adequate research in this day and age. Whatever you want to know is out there and not particularly hard to find.
It was especially obvious that the tech for the sake of tech/let’s copy Tesla’s homework EVs were going to get hit the worst too. I could’ve told you years ago that the EQS was hot garbage to avoid based on seeing pictures of the interior. I mean dear god…it’s like being at a black light party in an Apple Store on LSD.
Anyway, if you’re buying new you should also lease pretty much every German luxury car that isn’t special (911, full Ms/AMGs, etc.) because they all absolutely die value wise in the first couple of years. That being said…some of these are starting to get so cheap they’re hard to ignore. I mean 40 grand for the electric S class? I might be able to put up with the myriad eccentricities at that low of a price.
Agreed. It’s starting to become tempting!
It sounds insane to say but I’ll bet it would make for a was less stressful and financially intense ownership experience than a used S Class, 7 series or some other ICE luxobarge as well. I’m sure there will be electronic/tech gremlins galore but the actual powertrain shouldn’t be an issue.
Oh god…am I talking myself into a heavily depreciated EV luxobarge?!
Let it flow through you…
Does CarMax still offer the “DeMuro Warranty?”
They literally stopped because of Doug lol. His content went viral and everyone started coming in and asking for it, to the point that they couldn’t afford to offer it anymore.
No, they didn’t.
They did lower the maximum MaxCare coverage time from 6 years down to 5 years.
They also increased the maximum age of vehicles they sell to 12 years or 130K miles (model dependent).
Some of the MaxCare prices went up, but that’s also the market as a whole, as repair costs have increased dramatically, especially post-pandemic. Notably MaxCare isn’t through CarMax itself, it’s through three different extended service plan companies (Assurant, CNA National, & Fidelity Warranty Services, and it’s randomized which provider covers which owner).
CarMax also increased their included warranty period up to 90 days and 4,000 miles from purchase, which doesn’t have to do with MaxCare, per se, but is quite a generous offering for a used vehicle.
Yes they do, but they don’t sell certain vehicles. I don’t see any EQS on their website, but I do see EQB, EQE, B-class, audi e-tron, I-PACE, etc.
Great article. I would suggest as I am no expert buying any vehicle that is in the forefront of technology is a no win game. Have any bucked the trend of losing value to the vehicles coming after that perfected or at least improved on the original design? Also may I point out depreciation is meaningless until you sell the vehicle in question. Until then you bought a car, paid for the car and once paid off you earn the value of your car payment every month until repair bills escalate.
Maybe because some guy is currently in the mountains outside of Malibu telling everyone who will listen how much value his EQS lost. Was it you two hiking along, and the guy was coming downhill. And you were like “Nice day,huh?” And he was like “Shame this trail is steeper then the depreciation on my Ev Mercedes!” And you were like “tell me more?”. Is this some sort of subversive advertisement campaign? I can’t believe Ford would hire a man to go up to random strangers and express his displeasure with various German automakers! Have you know shame Jim Farley in particular, who may or may not have directly hired a single man to roam the greater Los Angeles area. Directly targeting the main audience of said cars at one of their main hobbies, while hiking various canyon trails.
How about $7/mi?
https://www.carfax.com/vehicle/KM8KNDAF6PU206796
See, at that lower price point, the $7,500 rebate really begins to dominate.
We’re a few years away from seeing these in the 24 Hours of Lemons, which more than once has been Viking funeral for depreciating German luxury cars.
https://johnedwinmason.typepad.com/.a/6a0112791cb10528a401538f8cf265970b-550wi
Kind of not seeing the problem here. But I suppose that’s because I’m not wealthy enough to spend six figures on an automobile.
But quite frankly, what’s it really matter? Most people keep their cars a while, as evidenced by the average age of cars being 12 years now. If your big concern when buying a $100,000 car is what it’s gonna be worth in just four years, then you have problems most of us can’t relate to.
Example Guy in the first paragraph of your story can cry me a river.
Nobody was complaining. He was just telling me a story.
I’m just pointing out some depreciation figures that I thought were a bit absurd. That’s all.
My last two smartphone purchases were 1.5 year old NOS flagships that retailed for over $1k unlocked, bought for $125-150, and used for 3-5 years. Any latest technology in a rapidly developing field will PUNISH early adopters.
Yes.
My cars are 3+ years old when bought. My phones are 1-2 years old when bought.
I would like to thank everyone who buys new, paying double, or more, of what I do, so that I don’t have to. Your sacrifice is appreciated.
The only vehicle I’ve ever bought new was a 2 year leftover motorcycle while I was employed there. Cars have been 5-15 years old, near the bottom of depreciation, but something I found desirable. Now that I no longer want to do more than basic maintenance (turned 60), I look for excellent condition, low mile, pampered examples that are less than half what a new average car goes for.
This is the way.
What’s the best marketplace for said phones?
Ebay- only top rated wholesalers of NOS and demo models. Worked for me twice.
Interesting to learn how much battery capacity (i.e., range) remains on a first-gen German luxury BEV sedan after 50K miles.
We own a 2019 eTron, bought it new, by now we put about 45k miles on it (didn’t drive much during the pandemic years). We really haven’t experienced noticeable battery degradation (those first year eTrons had really big battery buffers on the battery which probably helps with degradation).
The depreciation sucks but I don’t think anyone brought first gen Audi EV thinking it was going to hold its value, and we tend to keep cars for a long time anyway. That said it remains a really, really nice car. My 2 cents would be to buy a used 2024 in a couple of years (much better range than previous MY).
A correction, perhaps?
Maybe I am mistaken, but I believe both Mercedes and Audi still qualified for the tax credit of $7,500 back in 2019, plus some other state and utilities rebates. New car listings did not account for those.
Also, most EVs these days are listed with the $4,000 federal rebate for used EVs already deducted from the price, even when the buyer might not qualify.
So part of the depreciation is actually used EV prices factoring in that potential lower sale price when new, and adding on top the current rebate. Comparing it to ICE depreciation is not exactly apples to apples in every case.
Definitely worth noting that, even if it’s a relatively small (but not insignificant) factor.
The tax credit for used EVs has some strings attached. One of them is the price must be less than $25k. It’s intended to be a way to get lower income buyers into EVs.
Seem to recall a write up back in the summer about a Lucid owner that lost about 200/day or 30 bucks a day on their investment.
I’d buy a used Lucid.
Same here!
You don’t “Have to sell”. I know a guy who bought a lot of old European Sports cars, motorcycles, and Land Rovers with the justification is was because the values would go up, he has almost certainly spent more money maintaining said vehicles than the profit he’ll make from said vehicles once they’re all sold.
Do not buy vehicles expecting their values to go up long term and for you to profit from them by the time you sell them.
Buy vehicles for Transport. Buy a house to live in.
Bullshit logic like this is while 25+ year old POS houses that need all new plumbing and wiring are going for over half a million dollars because people decided that houses need to be a monetary investment first, instead of a roof over your head, and because of this homeowners are incentivized to keep the supply of housing limited and to create Little Hitler Societies known as HOAs.
Little Hitler Societies. I like that.
If you haven’t seen it already I’d highly recommend you watch the Robot Chicken skit titled Lil’ Hitler.
Well that escalated quickly. haha.
Sometimes you do have to sell, my employer sets a 4-year age limit on personal vehicles used for work, so, if I want to continue to be reimbursed for the 2,000 miles per month I drive for work, then I have to get a new car every 4 years. And, since they also set a minimum msrp requirement, I can’t buy something cheap, and ideally need some equity in the car to help with cutting down on the loan amount
So you aren’t buying a car based on resale since your mileage would be extremely high? So not the case here.
No, but I need to not be too ridiculously underwater on the loan by trade-in time and have some equity to apply to the next one
Are they reimbursing the standard GSA rate? That works to something like $42k a year. How much of that do you estimate goes back into the car itself?
No they are not, it’s 29 cents per mile, plus a flat lump sum on top of that, which means the actual per mile varies month to month when you add the two and divide by the mileage, always winds up at least somewhat lower than the federal rage
Most cars values only go up when the value of the currency goes down. If you can predict the ones that truly appreciate you are smarter than ai.
My mindset has always been “buy the car you want and drive it forever”. Who cares what the current market value is if you’re not going to sell it?
You’ve got it all backward – these cars are great buys… just a few years later. Sorry for people who bought them new but I bought a ’19 last year for a price a bit better than what you’re listing. I don’t really care much how it depreciates from here, because it’s taken such a big hit already it’s worth it for me now.
And then the German repair bogeyman enters the room.
So what are the chances that a German electric drivetrain are more robust than a German ICE drivetrain? I’d be tempted to roll the dice
Good for you.
Zero
I rolled the dice on a used VW e-Golf. My reasoning was that it would be more reliable than the gasoline version, since it was missing the most unreliable part of most VAG products, the engine. At least in my case, it worked out. I had zero problems with that car over the 5 years I owned it.
That’s only 5 years. I’d like to see what happens when it’s on the road for 15.
Couldn’t the same be said for any car? Also, since it was 3 years old when I bought it, it had been on the road for 8 years when I traded it off. Lest anyone think I’m some sort of VW apologist, the car I traded it for was an ID.4, and that car had serious software problems. I got rid of that after only a year of ownership.
Glass half full!
But what is the glass filled with? Wine, or Wizz?
Yeah, I think the EQS is ugly, but I saw those e-tron prices and started thinking “Maybe I need an electric Audi in my life?”
The last two graphs have a different baseline which makes them misleading to compare.
Not sure how easy it would be to have them all at a zero baseline for a better image of what’s going on.
This is why leases exist.
Fifty grand is a large hit, but you bought a depreciating luxury German asset: it’s not like it was going to pay dividends
If one of your cars lost a dollar of value for every mile you drove it, it would lose half its value rolling off the flatbed.