Resale value is one of the most important factors while deciding on a vehicle in the Indian market. As per a study by OLX Auto, MG Hector beats Tata Harrier, Mahindra XUV500 and even the Jeep Compass when it comes to resale. Currently, the Hector competes with the likes of Harrier, soon-to-be-discontinued XUV500 and the Jeep Compass, which is a segment higher according to the price but is in the same segment.
According to the study, a 2-year-old Tata Harrier will sell about 16.39% below the on-road price of the current model. The MG Hector has the lowest depreciation value, other the hand. It does come as quite an interesting fact as MG is fairly a new manufacturer in the Indian market as per a report on ACI.
Also read: Potential MG Motor Hector SUV buyer encounters Toyota car showroom by chance, ends up buying Fortuner luxury SUV
However, the substantial price hike of the MG Hector and strong demand for the car in the showrooms has caused a long waiting period in the market. With the increased ex-showroom price, the owners demand a higher price when selling their cars in the used car market.
Currently, the price of the MG Hector in the used car market is only Rs 80,000 to Rs 1,6 lakh lower than the price of the new car.
The Jeep Compass sees different levels of depreciation based on the fuel type. For example, the petrol-manual has the highest value, whereas the top-spec diesel-automatic does not hold the value much in the used car market.
Mahindra XUV500 sees the most price depreciation rate in the used car market. As Mahindra will soon replace the XUV500 with the all-new XUV700, there will be further depreciation on the vehicle as discontinued vehicles do not hold much value in the used car market.
How the study was done?
|Depreciation as per the OLX Auto Study|
|Tata Harrier||2.0D MT||Rs 14.99 lakh||16.39|
|1.5P MT||Rs 15.95 lakh||3.56|
|1.5P AT||Rs 18.45 lakh||3.57|
|2.0D MT||Rs 18.52 lakh||+2.08|
|Mahindra XUV500||2.2D MT||Rs 14.56 lakh||24.10|
|2.2D AT||Rs 17.35 lakh||20.34|
|Jeep Compass||2.0D MT||Rs 20.33 lakh||15.80|
|2.0D AT||Rs 22.30 lakh||30.94|
|1.4P MT||Rs 17.04 lakh||9.99|
|1.4P AT||Rs 18.46 lakh||23.87|
The depreciation percentages are based on the original on-road prices in the table above. However, the depreciation is calculated by using the current price of the new car. If a manufacturer has increased by quite a lot, that will translate into a better resale value as the current owners ask for a higher price while selling their vehicles in the used car market.
Also read: 8 tempting but risky used cars you can buy!