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Expensive rides that hold their value

The BMW 6 Series convertible is made in fewer numbers than the coupe and its $7,000, or 9.5 percent, price hike over the coupe provides a value-retention advantage when it's time to sell.
The BMW 6 Series convertible is made in fewer numbers than the coupe and its $7,000, or 9.5 percent, price hike over the coupe provides a value-retention advantage when it's time to sell.BMW
/ Source: Forbes Autos

The most expensive, fastest and least-practical vehicles are often the ones that retain the most value over time.

Not every vehicle on our list of the top 10 new luxury vehicles with the highest resale value embodies speed, excess and impracticality — for instance, Toyota’s staid Avalon sedan made the ranking. But most of them have at least one of those qualities. The Mercedes-Benz G55 AMG, which ties for first place, has all three: It’s a six-figure, brutish SUV that, despite its all-terrain pedigree, is tailored for driving on-road, not off. (See the slide show link below for the full list.)

High-performance capability and advanced technology, like sophisticated stability control systems or additional airbags and impact protection, are good indicators of high resale value, says Eric Ibara, director of market valuation at Kelley Blue Book, whose data was used to compile our list. The top-ranked Chevrolet Corvette, the supercharged BMW Alpina B7, and even the seemingly mild-mannered Infiniti M45 luxury sedan are all high-speed performers. Likewise, the two hybrids that made the list — the Lexus GS 450h and Honda Accord Hybrid — are performance oriented.

Supply and demand also have a big influence on how much value a vehicle retains over time. A car that sells well, meaning that it doesn’t languish unwanted on dealer lots and commands full sticker price or close to it, “will get a correspondingly good price when it’s used,” says Larry Batton, president of Auto Appraisal Group, based in Charlottesville, Va.

That could be why only one American vehicle, the Chevrolet Corvette, made this list. “A disproportionate number of dealer incentives have been applied to American cars,” says Kelley Blue Book’s Ibara. American auto manufacturers accounted for about 62 percent, or $2.2 billion, of all incentives spending on new vehicles sold in the U.S. in April, according to CNW Marketing Research. By comparison, Asian automakers accounted for nearly 34 percent, or $1.1 billion, in incentives spending during April, and European manufacturers accounted for just over 4 percent, or $144 million in incentives spending, according CNW data. “When car companies resort to huge incentives on new cars, it applies downward pressure on one- and two-year-old vehicles — as the new car price drops, so do the used car prices,” Ibara says.

Most vehicles on this list sell for their manufacturers’ suggested retail prices (MSRPs). Ones like the ultra-rare BMW Alpina B7, a performance-tuned version of BMW’s 7 Series, could easily sell for more than the MSRP. In general, vehicles that are in high demand due to limited production retain their value well. This encompasses not just extremely scarce models like the Alpina B7, of which only 200 will be sold in the U.S., but even more mainstream ones that simply aren’t produced in huge numbers, like the Infiniti M45. “It isn’t as common as the Infiniti G35, which you see all over and is easy to lease for a reasonable amount,” Ibara says. Infiniti sold 8,136 M45s from January through May, and 23,988 G35s during that same time period, according to the most recent data from CNW Marketing Research.

Note that the prices for all vehicles on this list are base MSRPs for the particular trim level and don’t include add-ons. That’s an important distinction when it comes to resale values, says Ricky Beggs, vice president and managing editor at Black Book National Auto Research, which tracks car valuation. If you stick $25,000 of options on any one of these cars, it could negatively affect the resale-value ratings.

“A lot of vehicles in dealerships have a lot of extra equipment on them — specifically, when people are leasing, they throw on a lot of extras,” Beggs says. “If the owners sell it in a few years, they’ll find that ‘fluff’ options might not retain value as much as the overall car does.” Those “fluff” options are features that could soon become obsolete, like dashboard-mounted touch-screen-type technologies, navigation systems, etc. — things that are expensive now when they’re new technology, but that could evolve quickly and become outdated faster than a pair of Skidz.

Our list of the top 10 luxury vehicles with the highest residual values (see the slide show link above) was compiled using Kelley Blue Book data for new vehicles with MSRPs $30,000 and up, including specific trims of vehicles, not just base MSRPs. The residual values are expressed as a percent of the original MSRP five years into the future. We’ve put the vehicles in ascending order. Vehicles that tied for a particular ranking are in alphabetical order.

Kelley Blue Book estimates future vehicle values based on a model’s past performance as well as new or notable features. “The best indicator of future performance is past performance,” Ibara says. For newly introduced models, Kelley Blue Book looks to past similar models from a given manufacturer.