Alan Judd

Profit and loss

Depreciation is to cars what compound interest is to us: it bites sooner and deeper than you think.

issue 15 September 2007

Depreciation is to cars what compound interest is to us: it bites sooner and deeper than you think. In March 2006 my sister-in-law paid a main dealer £8,000 for a 2002 Renault Laguna Sports Tourer Dynamique, an 1,800cc estate equipped with air-conditioning, sunroof (the UK market is apparently the only one that demands both), alloys, CD player, and so on. It was a one-owner car with a full main-dealer service history throughout its 25,500 miles.

In August this year, 17 months and 15,500 miles later, she sought to part-exchange it for a 2004 Mazda MX5. The Mazda main dealer offered her £2,000 for the Renault (What Car? gives £3,500 as the trade price). After protests he offered an extra £100 as ‘goodwill’. My sister-in-law did the sensible thing and walked away.

All right, she paid over the top in the first place for a four-year-old 1,800cc, especially now with Trade-Sales of Slough offering brand-new two-litre models for £11,999.

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