Buy (and sell) when the time is right.
According to a CARFAX report, new vehicles depreciate by 10 percent the moment you purchase them and drive them off the lot, and by another 10 percent in the first year of ownership. That’s 20 percent of your vehicle’s overall value lost in a single year of operation. Fortunately, depreciation slows considerably after two years of ownership.
We get it — there’s something exciting about buying a brand-spanking-new vehicle for your fleet. But, is that new car smell worth 20 percent of the vehicle cost? It makes much more sense to purchase vehicles that have been owned for over two years at a steep discount — in fact, it could save you hundreds of thousands of dollars over the course of a few years, depending on the size of your fleet.
However, it’s not just about buying at the right time. Selling your vehicle at the right time is crucial for recouping the maximum possible amount of value. Vehicles still under warranty or with a limited amount of miles are more likely to sell above market value, as are vehicles without a history of major breakdowns or repairs. By combining warranties, specific vehicle depreciation rates, and consumer data and reports on vehicle lifespans and likelihood for breakdowns, you can evaluate the best possible time to sell your fleet vehicles and minimize your overall vehicle expenses year over year.