When it comes to buying a car, the initial price tag often takes centre stage. It’s tempting to be drawn to vehicles with seemingly attractive price points, especially when unknown brands flood the market with enticing offers. However, a less obvious yet crucial piece of the puzzle is often overlooked — the car’s resale value and its impact on your financial future.

Whether you’re a first-time car buyer, an auto enthusiast, or simply someone looking to make a smart investment, understanding the importance of resale value can save you money and headaches in the long run. What looks like a great deal now might not be in three years when you try and sell it.

Let’s explore why resale value matters and why sticking to trusted, well-known brands is the safer, smarter option.

What is resale value?

Resale value refers to the amount of money your car will be worth when you decide to sell it or trade it in after some years of use. Cars, like most assets, depreciate over time, but some brands and models hold their value far better than others.

Why should you care?

For car buyers in Jamaica or anywhere in the world, resale value is more than just a number; it’s a reflection of:

• Market demand: Certain brands, like Kia, Honda, Toyota, and BMW, will consistently attract interest in the pre-owned market, thanks to their established reputation.

• Reliability: Vehicles from trusted names are known for their durability and lower maintenance costs, making them desirable even after years of use.

• Financial returns: A car that holds its value well can significantly reduce your total cost of ownership when the time comes to upgrade.

A car without reliable resale value could end up being a financial liability rather than an investment — a lesson too often learned the hard way with unknown or unproven brands.

The hidden risk of buying lesser-known brands

Jamaica’s car market, much like others around the globe, has recently seen a rise in lesser-known brands entering the scene with attractively low prices. While the upfront cost might seem like a bargain, there are underlying concerns that can result in long-term losses:

• Questionable reliability: Established brands like Kia, Volkswagen, and MINI have decades (or even over a century) of engineering experience and customer trust backing them. Unknown brands, however, lack a proven track record of reliability. Owners may find that these vehicles require frequent repairs or don’t age well, leading to unexpected expenses.

• Non-existent resale market: Unfamiliar car brands often face low demand in the resale market. Buyers tend to gravitate towards models they recognise and trust, leaving obscure brands with limited appeal. When the time comes to sell your car, you might struggle to find interested buyers — or you could be forced to accept a much lower price than anticipated.

• Higher depreciation rates: Cars from unrecognised manufacturers often depreciate faster than those from reputable brands. That attractive upfront cost quickly erodes in value, dragging your once-cheap purchase even further below its worth.

• Parts and service challenges: Reliable brands like MG, Porsche, and BYD have established networks to provide genuine parts and certified servicing. Lesser-known brands can fall short in this area, making repairs time-consuming and expensive.

• The ‘left hand drive’ factor: Some of the newer unknown brands are only available in left hand drive, these typically attract lower prices when it come to resale.

Next week in Auto we’ll look at why trusted brands hold value, and practical examples that highlight resale value.

Mark Dommisse is managing director at ATL Automotive.