Very good points, what price point do you think we would be able to pick up a 2 yr old GT for? 25k? It will be interesting to see what happens
This will be a long post – I decided to dig into the numbers and make some predictions.
First, looking at the residuals for Stinger GT leases, the value is estimated at 51-55% MSRP after 3 years. In other words, GT2’s have been estimated by Kia to be worth around $26.5k; GT’s around $21k.
Personally, I think the residuals will be way off.
I can see where Kia came up with the numbers – for many Kia models like the Optima, they would be accurate. Same goes for some competing luxury cars.
For example, the Hyundai Genesis/
G80 get recommended as a great used car value. The 2015 Genesis V6 fully loaded topped out around $50k, similar to the Stinger GT2. At the 3 year mark, many were for sale under 60% of their original value. Now we’re past the 4 year mark and there are plenty available below 50% of original MSRP.
As good as the Genesis/
G80 is, the demand isn’t high for it. Unlike the Stinger, it sold as many as 3,200 in a month. They were offered as luxury class rentals from Avis and the like, which brought a lot of used supply to the market.
Perhaps Kia used cars such as the Genesis along with their own lineup to come up with the residual numbers. What I don’t think they accounted for is enthusiasts.
We’ve seen what popularity with enthusiasts can do to the value of performance cars. It’s not even necessary to look back to the NSX and Supra of the 90’s.
The 1M is a special case, but an interesting one. The 1M has been seen selling for
more than its original MSRP at 8 years of age. Of course, BMW has motorsports heritage and the 1M was only produced for the 2011 model year. Still, it’s interesting to see what supply and demand can do to the values of even recently produced cars.
Another discontinued model popular with enthusiasts, the Chevy SS, certainly bucked the trend of poor sedan resale value for a GM. The Chevy SS kept around 80% of its value after 2 years, and 70% after 3 years.
More relevantly, I’ll look to some cars still in production. The Audi S3 and BMW M2 are popular with enthusiasts and continue to be available new. The S3 has kept about 78% of its value after 2 years; 70% after 3 years. The M2 is a recent addition which has kept about 79% after 2 years.
Lets look at another example from Dodge. Kia’s cars, on average, are more reliable than the general public thinks – perhaps the opposite of Dodge's cars. Still, enough people know about the track record and dealer discounts of Dodge that resale values are below average on much of their lineup.
However, that isn’t the case with the Charger SRT 392. Like the Chevy SS, it’s one of the few spacious and powerful sedans recently produced. It’s a relatively low-volume car and its popularity with enthusiasts has held up its resale. As with my other examples, the 2015 Charger SRT 392 was worth about 70% of MRSP after 3 years.
We’re at the point where Kia’s cars are at least as reliable, but in many cases more so, than the average car. Much of the typical Kia depreciation in the past was due to poor brand perception.
At this point, I think there are plenty of enthusiasts out there that realize the Stinger is both reliable and a good performance car, and thus a good value. For that reason, I personally don’t believe typical Kia depreciation will set in on the Stinger GT. Rather, I think the resale values will be closer to performance cars from other brands.
Now, there are a few factors that might make the Stinger’s resale value fall a bit short of my previous examples:
· Kia’s dealership promos are better than what you’ll find for the other cars I gave as an example. Even for shoppers that don’t do a lease buyout, there are some pretty good discounts off MSRP along with conquest/loyalty rebates. This impacts the “driven off the lot” value.
· The Stinger isn’t available with a manual transmission, while all of my examples are. Automatic versions of those cars sell pretty closely in price, but aren’t as sought after.
· This is the first car of its type from Kia, which may affect the price dealers are willing to pay at auction.
· If the market value of the Stinger is far above the residual at lease turn-in, owners will be more likely to do an end of lease buyout. They'll pocket a good amount of cash even if they price their cars below market value. Enough people do this, and it'll bring down the average a bit.
· New models like the
G70 and Supra could prove to be more popular, taking away some interest on the resale market.
All that said, here’s what I’m thinking about future resale values:
Stinger GT at 2 years/end of 2019: $31k average. Cars in certain locations, those with higher mileage, or poorly kept cars may been seen in the high $20k range.
Stinger GT at 3 years/end of 2020: $28k average. The 2020 model will be on dealership lots, but I expect changes to be minimal. If this seems high, note that 3 year old STI’s have sold around $30k on an MSRP of $40k.
Stinger GT2 at 2 years/end of 2019: $37.5k average. There are already a couple used GT2’s available near this price, but as an average this is where I think we’ll be. Keep in mind some ’18 leftovers will only have been driven 1 year at this point.
Stinger GT2 at 3 years/end of 2020: $34k average. A bold claim to be making. This is about $7k or 15% above the residual. With what I’ve found, though, I just don’t think we’ll see the
average price drop to $30k at this point - barring huge gas price increases and/or a recession.
