Tons of factors affect how long people keep their cars before trading them in on other vehicles. Trade-in values, concerns about depreciation, and personal preferences all have a bearing. If you’re trying to project how long your new wheels will last, or if you're just curious about how your automotive habits stack up to your neighbors’, average trade-in figures are based on several factors.
Average Length of Ownership
In the post-recession era the average car buyer holds onto her ride longer, as 78 percent of people intend to keep their cars at least 10 years, according to an AutoMD.com survey reported by USA Today. Thrift is often a major influence on these habits, as the term on auto loans has been extended to six to eight years, prompting people to hold onto their cars for years, according to CNBC. Before the 2008 recession, drivers swapped rides on average every four or five years, according to CNBC.
Cars Per Lifetime
The average driver used to buy 13 cars by the time he hit his 76th birthday, but the recession changed buying habits, according to CNBC. As of 2012, the average driver will own only 9.4 cars over the same period. Using these ownership statistics, an owner holds onto a typical vehicle for 6.4 years before getting rid of it. Before the recession, drivers got new sets of wheels every 4.6 years.
Built to Last
Tighter household budgets aren’t the only reasons Americans have slowed their car-buying schedules. Today's cars have a longer life. With cars going farther before their components bite the dust, owners don’t have repair bills that would prompt them to think about a trade-in, according to NBC News.com.
Instead of modeling your trade-in schedule on national averages, it makes more sense to consider depreciation and other financial factors. The average car loses between 18 and 28 percent of its value in the first year it’s off the lot, according to PF & Investing, and it loses 50 to 70 percent of its value in its first five years. After that cars don’t depreciate nearly as quickly. So once your car is 5 years old, each year it loses less trade-in value than a new vehicle.
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