This calculation was shared by a LYN forumer some time back which ive tweaked to suit.

Very often, we always focus on the resale value of a particular model while ignoring the start up costs and monthly loan repayment costs. This tabulation will show you why cars with lower resale value may actually be a cheaper. This is of course assuming maintenance costs are similar.

Peugeot 407 Premium 2.0L

Purchase price (2008) = $136,888

Toyota Camry 2.0L

Purchase price (2008) = $154,990

For simplicity, let's assume service/maintenance costs are equal. Thus, after 5 years, a Peugeot 407 vs Toyota Camry:

407 has HIGHER total loss
$85,367 (407) - $75,913 (Camry) = $9,454

407 has LOWER start-up cost
$15,499 (camry) - $13,688 (407) = $1,811

407 has HIGHER monthly positive cash flow through lower installments
$2,673 (camry) - $2,361 (407) x 60 months = $ 18,720
SUMMARY

This clearly shows that although the Peugeot 407 has RM 9,454 lower trade in value after 5 years but it gains a total of RM 20,531 from lower start up costs and lower monthly loan installments.

Thus, buying cars with lower resale value isnt actually a poor financial decision. So i think with this, we should not allow resale values to govern our choice of vehicles. Safety, value for money, specifications and maintenance costs should take precedence.

What do you think?