Better equipped tend to have lower residuals?

I noticed that better equipped cars seem to have lower residual values. Seems strange to me, I would have figured that and better equipped car would later sell easier.

This has been discussed before. You can search and find it. RVguy had a scientific explanation.

My anecdotal evidence is that the highest trims or highest MSRP depreciate the most. An S550 might be $100K new and worth $50K in 3 years. However an S65 might be $200K new and worth $90K in three years. These are just ballpark numbers but you get the drift.

Even on the same car, what is ‘better equipped’ to you might just be useless options to most people. If it’s something like air suspension on certain Mercedes, people might actually avoid it. Load up a 530i or E300 to the absolute gills, and in three years hardly anyone will want to pay you more than what a ‘well equipped’ one is going for. At the margins, the extra options equate to almost zero in residual value.

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That extra grand for shinier paint or a nav system is marked up on the msrp and not worth it in the used market.

It is the reason rental car companies don’t buy the top trims. They have a higher depreciation cost.

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You’re right, better equipped used cars do sell easier, because the used car buyer knows they’re getting options for cents on the dollar. :rofl: As many have mentioned, factory options are marked up and in the end not everyone wants them so they depreciate a lot. But keep in mind just because a higher optioned car has a lower RV, doesn’t mean it’s worth less than a basic car. For example, a basic $100k car with 50% RV will be worth $50k, while a optioned $110k with 48% RV will be worth $52.8k.