Kelley Blue Book unveiled the 2013 model-year vehicle winners of its Best Resale Value Awards this morning and dominating the competition were Toyota and Lexus.
For the second straight year, this pair swept the Best Resale Value brand rankings, with Toyota winning among the non-luxury makes and Lexus taking top honors in the luxury category.
Not only that, Toyota and Lexus combined to win 10 of the 22 vehicle category honors.
Before the awards were announced publicly, Auto Remarketing caught up with KBB’s Eric Ibarra to talk about this year’s crop of winners.
When asked why Toyota and Lexus dominated like they did, Ibarra said many other brands are likely wondering the same thing.
“That’s a question that probably all the other brands are asking,” he said.
But there’s no secret ingredient in the recipe for resale value success. Ibarra — KBB’s director of residual consulting — boiled it down more succinctly, pointing to the product value and incentive discipline.
“They just offer outstanding vehicles at a good value,” Ibarra said of Toyota and Lexus. “They understand how marketing decisions impact residual values.”
These brands have shied away from heavy incentivizing practices, Ibarra said, and the result has been that their used-car values are higher.
He also said that Toyota and Lexus are “very strong brands” and that they “have equity in their brand identity.”
There’s a built-in value to the brand names, and “people are willing to pay more for a Toyota or Lexus vehicle.”
Of course, there have been significant hurdles faced by these brands in recent years, perhaps most noticeably the vehicle recalls and the Japanese tsunami.
As for the latter’s impact of values, the shortage of units caused by the disaster “only helps used-car values.”
In explaining the degree to which the Toyota and Lexus residuals were affected by the recalls, Ibarra said that the impact is typically short lived. He said that “when we look at the duration of the impact, it typically only lasts months, not years.”
In fact, Toyota and Lexus values are “even above their historical average,” Ibarra said. Granted, part of that has been helped by the shortage of used supply.
The basis of the awards are projections from the Kelley Blue Book Officials Residual Value Guide. Winners are those vehicles projected to hold the strongest percentage of original MSRP after five years of ownership. It does not include low-volume vehicles or those with an MSRP higher than $60,000 (except for the high-performance and luxury categories).
Other Brands Making Waves
Of course, Toyota and Lexus weren’t the only ones generating accolades in KBB’s honors. Honda won four vehicle categories and had two of the top 10 cars for resale value.
Specifically, the following Honda vehicles won categorical awards:
- SUBCOMPACT CAR: Honda Fit
- COMPACT CAR: Honda Civic
- SPORTY COMPACT CAR: Honda Civic Si
- MIDSIZE CAR: Honda Accord
Meanwhile, the Civic and CR-V were also among the top 10 models for resale value.
“Honda is similar to Toyota in that they understand the impact of marketing decisions on used-car values,” Ibarra said, adding that Honda actually controls used supply better than Toyota by maintaining a low rental fleet. He also said Honda limits its incentives and conducts value pricing.
The complete list of winners provided by KBB is as follows:
2013 BEST RESALE VALUE: BRAND
2013 BEST RESALE VALUE: LUXURY BRAND
2013 BEST RESALE VALUE: BY VEHICLE CATEGORY
SUBCOMPACT CAR: Honda Fit
COMPACT CAR: Honda Civic
SPORTY COMPACT CAR: Honda Civic Si
MIDSIZE CAR: Honda Accord
FULL-SIZE CAR: Toyota Avalon
ENTRY-LEVEL LUXURY CAR: Lexus IS
LUXURY CAR: Lexus GS 350
HIGH-END LUXURY CAR: Porsche Panamera
SPORTS CAR: Chevrolet Camaro V6
HIGH-PERFORMANCE CAR: Chevrolet Camaro SS
HYBRID/ALTERNATIVE ENERGY CAR: Ford Fusion
ELECTRIC VEHICLE: Chevrolet Volt
COMPACT SUV/CROSSOVER: Jeep Wrangler
MIDSIZE SUV/CROSSOVER: Toyota FJ Cruiser
FULL-SIZE SUV/CROSSOVER: Toyota Sequoia
LUXURY COMPACT SUV/CROSSOVER: Infiniti EX
LUXURY MID-SIZE SUV/CROSSOVER: Porsche Cayenne
LUXURY FULL-SIZE SUV/CROSSOVER: Lexus LX
MIDSIZE PICKUP TRUCK: Toyota Tacoma
FULL-SIZE PICKUP TRUCK: Toyota Tundra
MINIVAN/VAN: Toyota Sienna
HYBRID SUV/CROSSOVER: Lexus RX 450h
2013 BEST RESALE VALUE: TOP 10 CARS (in alphabetical order)
Toyota FJ Cruiser
Toyota Land Cruiser
KBB notes that residual values used for award calculations are based on the November/December 2012 Kelley Blue Book Residual Value Guide.