Car Depreciation, in Plain English
A new car typically loses about 20% of its value in the first year and roughly 15% each year after. Wholesale sourcing skips the steepest drop — here's the math.
Depreciation Calculator
| Year | Retail purchase value | Wholesale purchase value |
|---|---|---|
| Today | $35,000 | $31,500 |
| Year 1 | $28,000 | $26,775 |
| Year 2 | $23,800 | $22,759 |
| Year 3 | $20,230 | $19,345 |
| Year 4 | $17,196 | $16,443 |
| Year 5 | $14,616 | $13,977 |
After 5 years, the wholesale-sourced vehicle is worth roughly $639 more than the same vehicle bought at retail — because you never paid the new-car premium in the first place.
Why the first year hurts most
The moment a new car is titled, it becomes "used." That paperwork change alone is worth thousands to the next buyer. Combine that with dealer markup, doc fees, and financing add-ons, and the average new vehicle loses about a fifth of its value inside 12 months.
How wholesale sourcing changes the math
Our clients buy from the same dealer-only auctions that stock retail lots — but without the retail markup. You skip the first-year cliff, keep more of your money invested in the vehicle, and typically own a lower-mileage car for the same monthly payment.
Depreciation tips before you buy
- Target vehicles 2–4 years old — the worst depreciation is behind them.
- Prioritize models with strong resale (Toyota, Honda, Lexus, select Mazdas).
- Get a pre-purchase inspection; hidden issues destroy resale faster than mileage.
- Buy at wholesale so your "purchase price" line already reflects real market value.
Ready to skip the depreciation cliff?
Tell us the vehicle you want and we'll source it at wholesale.
Start a sourcing request