Why do 911 Turbos depreciate so quickly?
 

I was wandering around E-bay tonight looking at cars, and zeroed in on 911 turbos. I was shocked at how low the prices were. Cars that were $140k+ new are now in the $60-70 range, and some have less than 20,000 miles on them.

Obviously E-bay is not the definitive place to go for market prices, but it still indicates a huge depreciation curve. Understandable for Boxsters, when the company is making tens of thousand a year, but the turbos?

There is a 2001 on there for $62.8, 24,00 miles. $63k for a car that hits 60 in 4.3, 185+ top end? Sign me up chief!

Are they pieces of junk?

I think that's a normal depreciation curve for that car. In the realm of $100k+ luxury/sports cars, it's actually holding pretty well. the thing you need to consider is that the primary market for those cars is the new car market and they sell to people who can buy them like a pair of socks, they would rather pay $20k over sticker for the newest/baddest status ride than have last year's news. That new Audi will be the hot car for the next couple months here, then cool down.

A 5 year-old 996 turbo w/ some miles that just went out of warranty and just lost the last of its *new car smell* is worth half of a new one. Only Ferraris and other low production exotics defy this, and usually only with super-low miles.

I would disagree that eBay is not the best indication of value. I think it is. It's the only place where you can see actual trading prices, somewhere like Autotrader is worthless with all of the dreamer sellers and no indication if anything is selling and for how much. :cool:

OTOH, the depreciation eventually stops.....

That's true with all Porsches. The core Porsche market (as opposed to the capricious, style conscious new Porsche market) removes the excesses that new Porsches come with--huge profit margins, latest greatest bling markup--and what you have left is a fairly stable value that represents the true intrinsic value of the car. From that point, the value adjusts much more slowly, relating more to mileage and condition than age.

I think the release of the 997 also plays into it. All of a sudden, as Denis said, the 996 is last year's news. A lot of people jumped ship to the 997, so the market got flooded with 996s, and consequently prices dropped. Now people who were considering boxsters are able to afford 996s. I saw a 99 advertised yesterday for I think $29K. NA, no fancy stuff, but still, under $30K? Top-end 3.2s are selling for more than that sometimes!

Remember when the 993 Twin Turbo's came out? Used ones were holding their value insanely well. They barely dropped in price! It took a while before they came below $90k or so.

I think production numbers come into play as well. Porsche didn't seem to make that many Turbos in years past (only two years of production on the 993 Turbo, '94 3.6's are rare, '91-'92 cars weren't built in huge numbers, etc). Now, 996 Turbo's are plentiful and the new 997 Turbo is out without much waiting between models (996 to 997). So, supply exceeds demand and pricing reflects that verses years past.

The 996 Turbo wasn't the old insane animal that Turbos used to be. I've not driven one, but several people I've talked to that have had decent seat time in them (and are familiar with older Turbos) state that while very quick, they could be used daily with little trouble or stress. More GT in feel than raw sports car. Maybe that affects what the used enthusiast market thinks of the car as well. The GT3 was always the more raw car and maybe enthusiats that have $65k to blow on a car may just pass up the "cushy" Turbo and go for something more raw...

In my area near my work, I used to routinely see a woman in her 60's driving a silver (did they all come in silver??) 996 Turbo around in town at 25 mph. I'm sure it was an automatic and was bought for status, not performance.

Jay
84 3.2, 90 964

Porsche Turbos, and Porsches in general, used to be special cars. People used to yearn for them and dream about having one for years while they worked to save up the money to buy one.

Now they are just mass-produced, churned out cars which are not that different than many other sports cars. And those that really want one just clip the "LOW LOW DOWN!!!!!" coupon out of the Sunday paper and go to the dealership to lease a Porsche for a few hundred a month.

They've become widespread appliances, so the values don't hold up any more.

"what's this old world coming to? things just ain't the same". water in a porsche?

$63K - geez, I'm over 40 and only this year passed $60K cumulatively spent on car purchases during my lifetime.

For $63K, the thing better go up in value. I wouldn't spend that except on a true collector/investment car. Unless/until I'm about 4X richer.

I bought a 996 Turbo recently, and have been enjoying every minute of it. The thing is dumb-fast, and beautiful to look at especially the side air intakes, the width of the car and all the modern amenities. Water cooled yes, but it's still a Porsche and is one of the best cars on the road for the price.

High-end electronically-controlled modern cars have become disposable. Depreciation increases exponentially as they approach the end of the warranty. Once they're off warranty, it's like passing a hot potato around - you take it. No you take. No YOU take it! :D

:D

The lottery thread here...even if I won megamillions, I wouldn't visit a Porsche dealership. NOTHING made by Porsche today interests me.

Moral of the story: Let someone else pay a car's depreciation.

Depreciation on vehicles has gotten ridiculous. The principle is making us such a throwaway society on everything from cars to appliances to computers it'd even make manufacturers of Chinese rubber dog schit blush with embarrassment.

Pay twice as much for something two years newer? Hell no.

Amen, brother! I can't ever picture myself buying any car new, fun toy or appliance car.

You ain't kiddin'...

My sister is thinking about getting a new car. However, to trade up 4 years and 38,000 miles (only!) on her domestic car is an absolute joke. These dealers won't discount much and her trade is worth essentially nothing.

Does everyone just buy on monthly payment alone and no one is paying attention to the true numbers of what it costs to trade up on a car? These dealers (of all makes) must be making a mint because 90% of the dealers (domestic AND foreign) around me are building beautiful new buildings with shiny new showrooms. That all costs money, so they must be making money hand over fist...

My father in law works for Ford as a manager at the plant where they build Crown Vics. He says Ford makes something to the tune of $7K CDN per vehicle sold. That's almost 1/4 of the purchase price!

Yes.

If you can afford the "latest and greatest" in your monthly budget, why bother to look at what it is really costing you?

I keep looking for that coupon you are talking about. Sure it wasn't for a Hyundai lease? I'd lease a 997 GT3 for a few hundred a month. Now that would be different. Sign me up

Agreed. If your current car costs $419 per month and you can get into a new one for $429 per month, that's all that counts. No one looks at the "to boot" price, interest rate, loan time period, trade in value, etc.

"What does it cost me this month" is all that counts.

I think those 0% APR or $XXXX cash back deals are hilarious.

If you take the 0% APR, you have essentially paid the interest on the loan upfront. I've run some net present value calculations on those deals and found the effective interest rate to be as high as 15%!!!

How do you figure?

+1

Heavier than a Corvette, about as fast as a Beemer sedan, with more creature comforts than most SUV's. Totally disconnected from the road via PASM, anti-lock, cruise control... Naw. Gimme a Lotus Elise, if we are talking new cars.


That is a large part of why I agree with Paul. In addition to having lost their soul, I don't even want to think about maintaining one off warranty. Egads.

The folks in this end of the pool are not DIY mechanics, either. What would be mechanically daunting to most of us (or even pretty damn simple, for that matter) would be a simple impossibility for them.

Notice a large number go up for sale with a major service pending? Or the ones that have just had one use it as a critical selling point? Then the next poor schmuck is just buying time, afraid to drive it with that service looming within a finite number of miles. I know a guy like this. Once accross town is a very big day for him. Sad.

The only problem with this math is NO new car that has a MSRP
of $15,000 also has a $3500 rebate or 0% offer, plus standard rates are a bit higher now than 4.99%
In some situations you are better off taking the rebate in lieu of 0 %

I have a 2002 Boxster, and the warranty runs out in July 2008, and sure don't plan on owning it after June. Things might be fine, but WOW can you get into the expensive end of the pool with those puppys.

I don't buy into your guys disgust regarding constantly changing cars. So what if want a new car every 2 years? I REALLY enjoy my cars, and I don't see anything wrong with viewing it as a luxury.

There are 2 different scenarios for people always buying new luxury cars. One is the typical consumer who is getting reamed on interest and depreciation just so that they can drive something new with a warranty. Usually they do not realize how many replacement engines and transmissions plus complete wiring harnesses they could buy with the $$ they are pissing down the toilet. And of course 1 in a million car owners ever has to buy a new engine, but anywhoo...

There is a second scenario, which for some reason people here choose not to acknowledge or understand, and it applies to new Porsches. There are a LOT of people with a LOT more money than you and me. Buying a new 997 is like buying a pair of socks for them in terms of household expense. Why on earth would they look at a used car? That's an absurd concept; they would liken it to buying used underwear. Even if it's in mint condition, no thanks.

This has not significantly changed over the years, it was the same when I sold new Porsches 20 years ago. 944s might have sold to people who were living off of credit cards, but 911s and especially 930s and 928s were cash deals. They would usually write a check of have their business managers wire the $$ over. Frequently they did not want to test drive the car first, just "get it ready for me".

There is a crazy amount of money in the world right now. Sales of private jets are at an all-time record high. Apartments in NYC and houses in Malibu sell for $20 million plus the day they are listed. Average shmoes like us can get smoking deals on the discarded expensive schit they buy when they are through with it in a couple of years. There is no strong secondary market for used 5 yr. old Porsche turbos.

The 996TT are in the toilet for re-sale. Great for a buyer, not so great for a seller.

The 930, 965 and 993 are holding their values well.

Yasin

Nothing at all? Megamillions?

Heathen!

http://forums.pelicanparts.com/uploa...1173233062.jpg

Good points all! A couple of my own. Dealerships make their money mostly on service, not selling cars. Those shiny new buildings are being built on $500 brake jobs and $100 oil changes. As far as any of these car "appreciating" in value, well, that's not going to happen for a long time. They may depreciate less, like the 993 or 3.2's, but no one is buying and then selling these as any profit like a longhood S. They car has to be in low production and highly sought after. I don't thing a 996 turbo falls in either. Depreciation is also based on production numbers which are very high for any late model Porsche. I've been shopping around and in my opinion, BMW has the best programs for buying a used vehicle with warranty coverage. I can buy a certified 545i from a dealer with an additional 2 years, 50,000 miles on the 4/50k. Even add no maintenance up to 100k miles for $1200. Now add loan rates at 3.9 to 4.7% up to 72 months (this month they are paying the first two months on top of this). I wouldn't even consider this with a used Porsche.

Wow, and I thought Pelican were die hard P-car fanatics. Guess not.
But, I still love my car, even if it's not appreciating in value. What happened to the saying, "these cars are meant to be driven?"http://forums.pelicanparts.com/uploa...1173284623.jpg

Look how sad she looks...:(

Actually, I haven't found a situation where you were better off not taking the rebate. The number themselves may not be realistic, but you get the picture. I just whipped those up on the spot.

People with Cash Flow buy new cars. People with lots of money buy 2 year old cars.

I bought a brand new F150 in 1998, I still have it today, just crossed the 100K mark. So far maintence has cost less than $2000, including a new set of tires. Before that I had an 85 Ranger that I bought in 86.

Cars are for the utility for going from point A to point B.

Well-put.

The corollary to this is that "people with cash flow" are very often not the same as the "people with money". In fact "people with cash flow" tend to have too much of that flow flowing away from them. If you want to be a person with money, don't be a "consumer".

I to have looked towards the Exige/ Elise side of things. The new Porsches are to loaded up with electronic gizmos and gadgets. Give me something light weight < 2000 lbs and about 300 hp with no radio, power windows, air conditioning blah blah blah.

Speedy:)