Residual value is an important factor in a vehicle fleet and essential for efficient fleet management. Here you can find out what residual value is, which methods can be used to determine it and what influences it.
What is the residual value?
This is the value that a vehicle still has at the end of its useful life. It is therefore often significantly lower than the new price of the car.
How can I calculate the residual value?
There are various ways of calculating the residual value of a vehicle. On the one hand, various online platforms offer the possibility of carrying out a valuation. You will receive an approximate market value based on the make, model, initial registration and vehicle registration number.
For a fee of around 150-200 euros, an individual valuation report can be drawn up by an expert, for example from TÜV, DEKRA or GTÜ. For many years, the Schwacke list, a vehicle database, also provided an orientation value. Since 2020, this can no longer be viewed by private individuals, but only by businesses for an annual fee.
What does residual value mean when leasing a car?
Residual value leasing is a form of company car leasing. The value that the vehicle is expected to have at the end of the contract term is used as the basis for calculating the monthly leasing rate. A higher value leads to lower installments, as the loss in value is lower over the term of the contract. At the end of the leasing contract, the lessee can decide whether to buy the vehicle at the agreed value, return the vehicle or conclude a new leasing contract.
Where is the residual value important?
In addition to company car leasing, the residual value of a vehicle also plays an important role in other areas of the vehicle fleet . These include:
Insurances
Insurance companies take the residual value of a vehicle into account when setting premiums and managing claims. In the event of a total loss, the value is used to determine the compensation that the vehicle owner receives.
Purchase decision
For companies, the residual value of a vehicle is an important factor in the purchasing decision. A vehicle with a high market value after its useful life can fetch a higher price when resold at a later date. This is particularly relevant when choosing between different vehicle models and brands.
Financing
Banks and financial institutions take the value into account in order to assess the risk and set the interest rates. A vehicle with a higher value represents a lower risk for the lender, which can therefore lead to more favorable loan conditions.
What influences the residual value?
The residual value of a vehicle is influenced by various factors. The period of use and the physical condition of the vehicle are decisive criteria. A well-maintained vehicle therefore tends to have a higher value than a neglected one. German car brands are also more stable in value than other brands. Used cars with high-quality equipment sell better and at a higher price than models with basic equipment.
Older models often lose value more quickly as new technologies come onto the market. Accidents or damage to the vehicle also reduce its value. In the event of a total loss, the residual value of the vehicle is zero.
