Consumers often don’t consider the resale value of a car when purchasing new, but it can end up saving you a lot of money in the long run.
The mid-size SUV segment accounts for a large portion of sales volume in South Africa, so we were particularly happy to see True Price’s findings on resale values in this segment.
The winner is the Volkswagen Tiguan, which thumps the Audi Q3. However, as Darryl Jacobson, managing director of True Price, reveals, the dark horse in the race is most definitely the Mazda CX-5, which romps home in second position. “It beats the Audi Q3, Hyundai iX35 and Kia Sportage quite handsomely – which is most interesting,” he notes.
The results are based on data collected at vehicle auctions by True Price, the innovative start-up that is providing South Africans with free vehicle evaluations. The company bases these evaluations on actual prices paid on auction. Accordingly, True Price has data pertaining to thousands of vehicles sold on auction on its system.
In order to be as fair to the vehicles as possible, data was gleaned covering three kilometre categories: zero to 50 000 km, 50 000 to 100 000 km and over 100 000 km. “We find that the data tends to follow the same patterns in the various kilometre categories. However, we like to break this down in order to be as transparent as possible,” explains Jacobson.
As already stated, the Volkswagen Tiguan rules the roost when it comes to cars for soccer moms. “It achieved 79% of its original sales price in the sub-50 000 km category, 62% of its original sales price in the 50 000 to 100 000 km category and 52% of its original sales price in the over 100 000 km category,” reveals Jacobson.
The True Price MD says he’s not surprised to see the popularity of the Tiguan amongst used car buyers. “Volkswagen and Toyota are South Africa’s most beloved vehicle brands. This means that virtually all Volkswagen and Toyota vehicles retain their value,” he notes.
In second place is the Mazda CX-5, which delivered 71% of its original sales price in the sub-50 000 km category, 59% of its original sales price in the 50 000 to 100 000 km category and 50% of its original sales price in the over 100 000 km category. Jacobson says that it is interesting to note the success of Mazda – both in the used vehicle arena and in the South African automotive market.
“Mazda Southern Africa opened its South African head office just over four years ago, and I think many people have watched its development and success with great interest. One of its strategies has been to build a strong dealer network in South Africa, Namibia, Botswana and Swaziland. The company has also introduced an industry-first Mazda LIFETIME Parts Warranty, where it commits to repair or replace failed parts for the vehicle’s lifetime. Both of these initiatives have seen buyers of both new and used Mazda vehicles gain confidence in the brand,” he notes.
While Mazda remains one of the smaller players in the industry, it is growing in terms of both numbers and stature. “Back in 2014, Mazda sold a mere 4 500 units in this country. Last year, it sold more than 1 000 units a month! While Mazda trails the likes of Toyota and Volkswagen by a massive margin, that is still quite some growth,” Jacobson notes.
While new vehicle sales have grown, so too has the confidence of used car buyers. “When Mazda vehicles come up on auction, bidding is always keen. I was not surprised to see the Mazda CX-5, our runner-up in the vehicles for soccer moms shootout, coming up trumps at the 2018 Gumtree Pre-Owned Vehicle Awards, where it was crowned category winner for sports utility vehicles (SUVs) under R505 000,” comments Jacobson.
Third place went to the Kia Sportage, which clocks in at 67% of its original sales price in the sub-50 000 km category, 58% of its original sales price in the 50 000 to 100 000 km category and 55% of its original sales price in the over 100 000 km category. “Yet again, it is a case of Kia beating Hyundai. This is something we’re seeing more and more,” comments Jacobson.
Fourth place went to the Audi Q3, which retained 64% of its original sales price in the sub-50 000 km category, 55% of its original sales price in the 50 000 to 100 000 km category and 45% of its original sales price in the over 100 000 km category. “I am really surprised to see it lagging so far behind its Tiguan sibling. I would have expected it to be a neck-and-neck race between the two Germans,” says Jacobson.
Fifth place went to the Hyundai iX35/Hyundai Tucson, which notched up 60% of its original sales price in the sub-50 000 km category, 54% of its original sales price in the 50 000 to 100 000 km category and 47% of its original sales price in the over 100 000 km category.
“This mirrors our findings last year when we compared the resale value of the Kia Rio to the Hyundai i20. One would have thought that there would be nothing in it. After all, Kia and Hyundai have the same parent company. Accordingly, the engines, transmissions, electronics, platforms and technology are often shared between the brands. But, in our previous shootout, the Kia emerged triumphant. And now, when we turned our attention to vehicles for soccer moms, exactly the same pattern emerged!” Jacobson points out.
Jacobson stresses that resale value is vitally important when shopping for a new vehicle. “The value of some new cars falls at an alarming rate. Soccer moms – as well as all other buyers – should always consider this very important issue when buying a new car. It is undoubtedly one of the most important buying criteria. If you’re buying a new car, look beyond those tantalising advertisements and the car’s sexy styling… and consider resale value. Your wallet will thank you one day,” Jacobson concludes.
