Volvo or VOLVO is a Swedish multinational automobile manufacturing company that manufactures sport utility vehicles, compact executive sedans, station wagons, hatchbacks, and sedans.
Founded in 1927, Volvo has witnessed a lot to become a popular automobile brand in the global market. Being a luxury car brand, you’ll always find Volvo cars on a higher side or at par with brands like Audi, BMW, Mercedes, Land Rover, etc.
However, even the high costs of the cars haven’t made its lovers spare any thought before spending such huge amounts to park the iconic Volvo cars in their garage.
If you, too, have a sweet corner for Volvo cars in your heart and wish to have your hands on the steering wheel of a Volvo car, you can invest in a used car!
Yes, compared to the other luxurious car brands, the used Volvo cars are much more economical, and anyone with a standard budget can afford them. If you’re wondering why used Volvo cars are inexpensive, this article will help you a lot. Continue reading to find the actual reasons that make a used Volvo so economical.
Why are Volvos used so cheap?
Of all the luxurious car manufacturers, the cars from Volvo are the most affordable to own when they are old. There are several reasons what lead to such low costs, and these include the following.
Their price or value depreciates quickly
The value or price depreciation is the most vital factor that affects the cost of vehicles after getting out of the showroom. It is particularly more for luxury vehicles because such cars have numerous advanced features that can go wrong at any time; they are expensive to drive and maintain.
Due to these reasons, their value depreciates quickly, and within a few years of purchase, their actual price tag can witness a sharp fall. For example, Volvo’s least expensive and brand new luxury line Volvo XC90 T5 Momentum costs $49,000. However, if you’re buying a used model, say 3-years old, it will cost you nearly $39,990! That’s a lot of difference in the price gap.
Note that this price gap depends upon many factors and varies with brands and automobile range like SUV, sedan, truck, etc. For example, a brand new BMW 7 Series comes under $90,000 while its 3-year old model can come at as low as $30,000! So, in the case of BMW, the price depreciation is quicker than Volvo.
Affluent people don’t buy used cars
It’s a reality that those who can afford to pay for a brand new car won’t show any interest in the same car’s used example. Now, though used cars are cheap, they aren’t that cheap that anyone can purchase them.
Due to this, the market of used cars grows at such a rate that dealers have to sell the used cars at such a rate (cheap rate) that even a non-affluent individual can think about purchasing one.
So, to prevent the used luxury cars of brands like Volvo from warming the showroom for long periods, they are made “available for sale” at economical prices.
Volvo cars aren’t very reliable yet
Yes, Volvo cars were never known for their reliability. Due to this, its used vehicles are always available at cheap rates globally. Since with time and use, their reliability suffers further hits and may completely die out if not used in time. Thus, selling them at low prices is the only solution to avoid huge losses once the car becomes crap.
There is a big market for used cars in the USA.
It is another good reason why used cars are so cheap in the United States. Since there is one car for every American, this likewise translates to lots of cars. You can also say that the market of cars is so huge there, better pricing of every car makes certain brands or models accessible at lower rates.
High maintenance and driving costs.
Luxurious cars are expensive to drive and maintain. Due to this, it’s not a good option to keep such cars for long years and selling in a few years is the best you can do with any luxury car. Thus, car owners agree to sell their luxury cars cheaply to prevent any loss they might incur by doing the same later.
These are the prominent reasons you’ll find super expensive Volvo cars at a much lower price in the used condition.
If we reconsider the example of Volvo XC90 T5 Momentum, its current market price is around $49,000. That’s seriously huge. However, due to its low reliability, it may not witness good sales from those who want a Volvo car but will hardly make their mind seeing the price tag.
For such customers, a used model, say 3-year old, will form a better option at $39,990. This price gap is due to several factors, as discussed above. In a nutshell, luxurious cars are much more economical in their used state than in new.