Does Jeep Hold its Value: 6 Models Compared
Jeep is a U.S automobile manufacturing company owned by Stellantis cooperation. It was founded during the World War II era and now solely produces sports utility vehicles (SUVs).
Jeep sold more than 1.5 million vehicles in 2019 and has a world market share of 2.89%. U.S and Canada are its main market and more than 65% of its revenue come from these two countries.
But do Jeeps hold their value? Why does it depreciate the most in the first year? And how old Jeep should you buy? In this article, I am going to answer these questions in detail and will also compare the depreciation trends of popular Jeep models.
Do Jeeps Hold Their Value?
You would find both extremes in the depreciation trends of Jeep. Jeep Wrangler is among the top performers when it comes to value retention and holds its value for a long time. While on the other hand, models like Cherokee and Compass do not hold their well and have below-average value retention. On average, Jeep holds 52% of its value after 5 years of operation.
Whereas other cars brands hold around 50% of their value during the same time. The below graph shows the average depreciation of Jeep cars over the 12 year time period.
While the following illustration shows the year-to-year depreciation percentage of Jeep cars. Usually, Jeep cars depreciate the most (24%) in the first year of their operation. For the rest of their lifespan, they depreciate at a pretty consistent rate of 4 to 6 percent per year.
6 Popular Jeep Models and Their Depreciation
Now let’s have a look at the depreciation trends of 6 popular Jeep models over the period of 10 years.
1. Jeep Wrangler
Wrangler is Jeep’s best-performing model when it comes to value retention. It has been in production since 1986 and the latest generation was unveiled in 2017.
It has won multiple Kelley’s Blue Book (KBB) Best Resale Value Awards in the sport utility vehicle category and a study in 2018 named it as the vehicle with the best value retention after 5 years.
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Initial Selling Price: $43,391
Percentage Depreciation after 5 Years: 35%
10-Year Depreciation Projection:
| Vehicle Age | Depreciation | Residual Value | Vehicle Worth |
| 1 | $9,199 | 78.80% | $34,192 |
| 2 | $10,479 | 75.85% | $32,912 |
| 3 | $12,215 | 71.85% | $31,176 |
| 4 | $13,143 | 69.71% | $30,248 |
| 5 | $15,156 | 65.07% | $28,235 |
| 6 | $16,471 | 62.04% | $26,920 |
| 7 | $17,356 | 60.00% | $26,035 |
| 8 | $19,005 | 56.20% | $24,386 |
| 9 | $21,687 | 50.02% | $21,704 |
| 10 | $22,741 | 47.59% | $20,650 |
Also read: Are Jeep Wrangler Parts Expensive? (The Full List)
2. Jeep Cherokee
Cherokee is a Jeep’s crossover SUV named after a tribe of North American Indians. It first went into production in 1974 and Cherokee KL is its latest fifth-generation model.
It has a towing capacity of 4500 pounds. It offers better off-road capabilities than its competitors. It has six different trims and each comes with its own unique set of features.
Initial Selling Price: $35,789
Percentage Depreciation after 5 Years: 56%
10-Year Depreciation Projection:
| Vehicle Age | Depreciation | Residual Value | Vehicle Worth |
| 1 | $11,785 | 67.07% | $24,004 |
| 2 | $13,081 | 63.45% | $22,708 |
| 3 | $13,897 | 61.17% | $21,892 |
| 4 | $17,640 | 50.71% | $18,149 |
| 5 | $20,067 | 43.93% | $15,722 |
| 6 | $21,246 | 40.64% | $14,543 |
| 7 | $22,322 | 37.63% | $13,467 |
| 8 | $23,332 | 34.81% | $12,457 |
| 9 | $24,266 | 32.20% | $11,523 |
| 10 | $25,130 | 29.78% | $10,659 |
Also read: Are Jeeps Good Cars? 14 Things You Need to Know
3. Jeep Compass
Jeep Compass falls under the umbrella of compact crossover SUVs and comes with both petrol and diesel engine options. It is packed with modern high-tech features and has an affordable selling price.
It fills the space between Jeep Renegade and Cherokee models and majorly competes against Mazda CX-5 and Toyota RAV4.
Initial Selling Price: $25,027
Percentage Depreciation after 5 Years: 48%
10-Year Depreciation Projection:
| Vehicle Age | Depreciation | Residual Value | Vehicle Worth |
| 1 | $4,077 | 83.74% | $20,995 |
| 2 | $5,378 | 78.55% | $19,694 |
| 3 | $9,006 | 64.08% | $16,066 |
| 4 | $10,019 | 60.04% | $15,053 |
| 5 | $12,142 | 51.57% | $12,930 |
| 6 | $14,321 | 42.88% | $10,751 |
| 7 | $15,856 | 36.76% | $9,216 |
| 8 | $16,878 | 32.68% | $8,194 |
| 9 | $18,766 | 25.15% | $6,306 |
| 10 | $18,824 | 24.92% | $6,248 |
Also read: 6 Best Jeeps with a Panoramic Sunroof (+Photos)
4. Jeep Gladiator
Jeep Gladiator is a midsize pickup truck and went recently into production in 2019. Based on the same platform as Wrangler JL, it is one of the last American pickup trucks that are still available with manual transmission.
It has removable body panels and comes with excellent off-road capabilities. The optional diesel engine is more powerful and has a massive towing capacity of 7650 pounds.
Initial Selling Price: $41,591
Percentage Depreciation after 5 Years: 40%
10-Year Depreciation Projection:
| Vehicle Age | Depreciation | Residual Value | Vehicle Worth |
| 1 | $6,646 | 84.02% | $34,945 |
| 2 | $9,192 | 77.90% | $32,399 |
| 3 | $11,267 | 72.91% | $30,324 |
| 4 | $13,567 | 67.38% | $28,024 |
| 5 | $16,824 | 59.55% | $24,767 |
| 6 | $19,161 | 53.93% | $22,430 |
| 7 | $20,904 | 49.74% | $20,687 |
| 8 | $24,601 | 40.85% | $16,990 |
| 9 | $25,824 | 37.91% | $15,767 |
| 10 | $27,022 | 35.03% | $14,569 |
5. Jeep Grand Cherokee
It belongs to a range of mid-size SUVs. All units of Cherokee have been built using an unibody chassis. It comes with multiple engine options and has a roomy and upscale interior. Along with refined on-road experience, it offers spectacular off-road capabilities and a lot of luxuries with style.
Initial Selling Price: $47,753
Percentage Depreciation after 5 Years: 51%
10-Year Depreciation Projection:
| Vehicle Age | Depreciation | Residual Value | Vehicle Worth |
| 1 | $11,680 | 75.54% | $36,073 |
| 2 | $15,482 | 67.58% | $32,271 |
| 3 | $17,635 | 63.07% | $30,118 |
| 4 | $21,637 | 54.69% | $26,116 |
| 5 | $24,287 | 49.14% | $23,466 |
| 6 | $28,155 | 41.04% | $19,598 |
| 7 | $29,659 | 37.89% | $18,094 |
| 8 | $33,613 | 29.61% | $14,140 |
| 9 | $34,674 | 27.39% | $13,079 |
| 10 | $35,655 | 25.33% | $12,098 |
Also read: Why Do Toyotas Hold Value so Well? (Buy These Models)
6. Jeep Renegade
Renegade is a subcompact crossover SUV and was first introduced by Jeep in 2015. While the base model has only front-wheel drive, some variants also offer a four-wheel-drive system. It is the smallest SUV produced by Jeep and mainly competes with Subaru Crosstrek, Nissan Rogue, and Chevrolet Trax.
Initial Selling Price: $27,667
Percentage Depreciation after 5 Years: 48%
10-Year Depreciation Projection:
| Vehicle Age | Depreciation | Residual Value | Vehicle Worth |
| 1 | $6,560 | 76.29% | $21,107 |
| 2 | $7,924 | 71.36% | $19,743 |
| 3 | $9,672 | 65.04% | $17,995 |
| 4 | $11,402 | 58.79% | $16,265 |
| 5 | $13,161 | 52.43% | $14,506 |
| 6 | $14,506 | 47.57% | $13,161 |
| 7 | $15,751 | 43.07% | $11,916 |
| 8 | $16,739 | 39.50% | $10,928 |
| 9 | $17,981 | 35.01% | $9,686 |
| 10 | $18,390 | 33.53% | $9,277 |
Why Do Jeeps Hold Their Value so Well?
Although Jeep value retention largely varies with each model, overall Jeep SUVs hold their value well. The main reasons behind this value retention are its popularity, reliability, and performance.
- Jeep cars are well known for their off-road capabilities and can withstand extreme weather conditions.
- They have high ground clearance, which protects its chassis from standing water and other obstacles.
- Jeep has a rich history of more than 8 decades, and some of its models are still in production since the early ‘80s.
- Jeep’s constant popularity among car enthusiasts is another reason for its value retention.
- Jeep has impressive accolades to its name, especially its model Wrangler, which took the Kelly Blue Book Best Resale Value award from 2017 to 2020 in the sports utility vehicle category.
- Jeep SUVs are comparatively affordable when compared with other luxury SUVs. An affordable initial price will automatically decrease the depreciation cost and result in better resale value.
Why Do Jeeps Lose Value Fast in the First Year?
On average, Jeep cars lose 24% of their value in the first year of operation, and the main reason behind this significant drop is the low demand for one-year-old Jeep vehicles.
Because of comparatively low initial prices of Jeep cars, people often tend to buy the new model instead of buying a one-year-old model. Even the best-performing cars like Subaru lose 17% of their value in the first year, therefore a 24% drop is not too bad for a brand like Jeep.
Nowadays companies launch a new model every year which automatically drops the resale value of the previous model.
Which Jeep to Buy, When to Buy it, and When to Sell it to Save as Much as Possible?
One-year-old Jeep Wrangler is the best car to buy to save the maximum amount of money. Another great option will be buying a two-year-old Jeep Grand Cherokee. It will cost you 68% of the initial price and still have 84% of the useful life remaining.
The initial selling price of the Jeep Wrangler is $43,391 whereas a year-old Wrangler will cost you around $34,192. This only amounts to 79% of the original cost and will still have 92% of useful life remaining. For the rest of the years, it will depreciate at a very slow rate and have a remarkable resale value.
Also read: Are Land Rovers Reliable? The Facts You Need to Know
What Can You Do to Decrease Any Jeep Depreciation?
The depreciation rate of Jeep cars can be decreased by taking below mentioned steps:
- Do not buy a brand-new Jeep vehicle because it depreciates the most in the first year and will lose around one-fourth of its value in the first year alone.
- Always try to keep your Jeep in good condition and never miss the regular maintenance of the car.
- Try to buy a used Jeep with minimum mileage because the more mileage the car has the less it will be worth.
- Maintain the full-service history of your car, as it is a great way to reassure your buyer that the car has been well maintained.
- Try to buy a Jeep SUV with neutral paint colors like black or silver because neutral colors are forever popular and retain more value than exotic paint colors.
Does Jeep Hold its Value Well When Compared to Other Similar Car Brands?
Overall, Jeep cars perform above average when compared with the car brands of a similar segment. But its model Wrangler is a top-performing car when it comes to value retention. It holds its value incredibly well.
After three years of operation, Jeep loses 35% of its value, while other car brands of a similar segment lose 40% of their value in the same time period. Jeep cars perform better than other brands like Nissan, KIA, and Mitsubishi but lose more value than brands like Subaru, Honda, and Toyota.
References:
caredge.com, en.wikipedia.org, fiatgroupworld.com, statista.com, caranddriver.com, edmunds.com, motorandwheels.com, kendalldodgechryslerjeepram.com
