We’re considering buying a new 2021 Toyota Sienna this week, at MSRP (+ $700 worthless interior/exterior protector and $400 floor mats). Normally, I would say this is a terrible idea. But here I am with car inventories incredibly limited, Siennas in very high demand, the factory to be idled for at least couple weeks at the end of the month, and 2022 Sienna pricing and orders not available yet.
Since there’s no way I’m getting a typical end-of-model-year discount on this, I’m trying to estimate how much less this van will be worth at sale/trade in several years, compared to a similar 2022 model I might (wishfully) be able to buy two months from now. I can’t find any data on this, though.
Is it just a straight up full extra year of depreciation (minus a bit for mileage adjustment)? Put another way, what’s the break-even discount one needs to see to make buying an end-of-model-year car a decent idea?
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Depends on when you are thinking of selling/trading it. In 3 years, 2022 vs. 2021 will be a big difference, in 10 years 2022 vs. 2021 will mean next to nothing in price.
May I humbly suggest delaying your consideration. Despite all of the warnings about chip shortages, I suspect that the ending of unemployment bonuses (those are still ending, right?) will have a significant impact on demand for autos. Unless Toyota has built slowdowns, other than supplier created ones, into production, there should be a decent inventory in the latter part of the fourth quarter. You may also find dealers looking to get rid of current year inventory before 2022 begins.
I’m not in your shoes, so don’t know your requirements, and may behave differently if in your situation.
According to Chip shortage: Toyota to cut global production by 40% - BBC News , it’s a supplier-created slow down. Toyota had a stockpile of chips that has allowed them to avoid the slow down for longer than other manufacturers but their stockpile has run out.
That’s what we’ve decided to do, almost by default. I passed on the one I had an option on this week, for various reasons. In the meantime 2022 pricing was finally released (~$500 increase) and there are rumors of deliveries beginning in October.
Now the issue is finding a dealer who will/can take an order. Thanks to the Costco Auto program these can be had a bit under MSRP. But so far allocation requests or orders aren’t being allowed. And assume the first ones will be going to fill 2021 order holders who lucked out and have 2022s coming to them.
Back to the original topic of depreciation…
I’d actually love to get a Kia Carnival instead, but they’re at 3-6 months for delivery of higher trim levels.
It has a far nicer interior and features…compared to any trim of the Sienna, actually. Aside from gas mileage the only thing it has against it may be depreciation.
Kias have historically had below-average depreciation. But the Carnival is something of a sibling to their new-in-2020 Telluride, which is very highly rated and was going for over MSRP before all these covid and chip issues.
So there’s reason to believe Telluride depreciation will be similar to Carnival, and reasons that Telluride might hold its value well. Unfortunately, although there’s only a couple years to go on, Telluride depreciation numbers don’t look much better than previous Kia numbers.