Car Depreciation Calculator

Vehicle depreciation compounds — each year's loss is calculated against the previous year's already-reduced value, not the original purchase price. This mirrors real-world depreciation curves, where cars lose a larger dollar amount early on and smaller dollar amounts (of a similar percentage) in later years.

Industry estimates commonly cite 15-20% per year as typical for average vehicles after the first year (which often sees a steeper 20-30% drop), though the actual rate varies widely by brand, model reliability, market demand, and mileage — luxury and electric vehicles often depreciate faster than reliable, popular models.

Not separately — this calculator applies the same percentage rate uniformly across all years for simplicity. In reality, the first year often has the steepest drop; for a more realistic estimate, you could run the calculator once for year 1 with a higher rate, then use the resulting value as your new "purchase price" for subsequent years at a lower rate.

Yes — estimating future resale or trade-in value helps with total cost of ownership comparisons between vehicles, deciding whether to sell before or after a steep depreciation year, and setting realistic expectations for loan payoff versus vehicle value (avoiding being "underwater" on a loan).