riknchar

As an avid follower of all things Lexus, and as an owner of what I consider to be two of the finest Lexus cars ever produced (a 2008 LS600hL and a 2002 SC430), I was recently struck by the serious disparity in resale values between these two vehicles.

I was browsing through the Cars.Com list of used LS600hLs and SC430s (as I enjoy doing when I have time to kill), and I noticed that well-maintained 2008 SC430s, with around 45K miles, seemed to be selling consistently around $32K. I then noted that the same year, condition, and mileage LS600hL (with the Executive Seating package in the back) was selling for same $32K.

I started thinking about it, and discovered that when sold new in 2008, the SC430 had an MSRP of $66,355, while the LS600hL with Executive Seating had an MSRP of around $112,000.

So how is it that the LS600hL has retained only 29% of its original MSRP while the SC430 has retained nearly 50%? I know the LS600hL is more of a "niche" car, with a ridiculous MSRP, but the difference is resale value still shocks me.

Could it be that since the SC430 stopped production in 2010, and still has a very loyal fan base, the resale value has been kept artificially elevated? Or could it be that the LS600hL was way overpriced to begin with, and very few people want to risk the potential maintenance costs associated with the aging battery technology, so the prices have dropped like a rock?

Anyway, to me it seems to imply that a used LS600hL is likely a better value than a SC430, all things being equal (although I realize people who shop for an LS600hL are probably not cross-shopping for an SC430).

Any thoughts from the forum?

dal20402

A few things:

- More SCs have low miles and have been babied. The SC is more likely to be a weekend car while the LS is an everyday family car. This affects resale values overall, enough that even a low-mile LS will be lower. I think it accounts for the difference between SC430 and LS460 prices.
- The 600h was overpriced at MSRP. Extremely high-priced versions of luxury cars usually suffer more depreciation.
- As you point out, there is a dedicated SC430 owner and fan base. The 600h is really, really obscure, and looks to most of the world like just another big sedan.

As for value, it all depends on what you need. If you're looking for a convertible, a LS600h isn't a very good value. If you're looking for an executive sedan with massive rear legroom, a SC430 isn't a very good value.

riknchar

Good points, Dal. I do dearly love my LS600hL, partly because of how obscure (I prefer unique it is, and am thankful for the extreme depreciation it has suffered (I wouldn't pay $112K for one, but am happy to enjoy the well-maintained depreciated version). I really think this would be a great time to be in the market for an LS600hL!

I also love the SC430 line, and am glad there is such a loyal fan base for that car.

Nospinzone

That is a substantial difference in depreciation. The price of each vehicle is a function of supply and demand. I did a quick search to see how many have been sold in the U.S.

It appears about 60,000 SC430's were sold. The best I could find on the LS 600 was this quote -
"Lexus aimed to sell 1,200 to 2,000 units a year in the U.S., but that has not happened. The best sales year was 2008, with 980 cars sold and the numbers have diminished every year with 2011 tallying only 84 units. Just 19 buyers stepped up in the first quarter of 2012."

Clearly supply doesn't explain the difference, so it has to be the demand. Certainly your example of the two 2008 models makes the 600 a compelling buy from a value standpoint. However other reasons put the 430 as much more desirable.

Our household is split. For $32K I would buy the 600 and my wife would buy the 430. I almost bought a 2009 PB edition for her a couple years ago, but at the time she really needed to keep her current 4 door with ample trunk space. She doesn't need that space any more, so it is still a possibility.

Duck05

The 2008 SCs seem to be in that range (29-34).

The 600L as others have said is a niche car and prone to low demand driving down the resale price point. And, with the price of gasoline being low at the moment and the belief that owners of hybrid cars seem to sell their vehicles right before needing the major battery maintenance/replacement (true or not) makes those kind of cars not as coveted.

You have two real nice Lexus cars which will serve you for a long time. Checking the resale value is fun and we have many threads in all the various model forums (I am in three) where the topic of value is debated on many fronts.

My wife has a friend that has been a Corvette disciple having had 4 of those sport cars over the past 10-15 years but was always jealous of her 430 and how smooth it drove (and the ease of getting in and out). So, her husband went out and picked up a 2013 MB S550 (why not a 460 I can not say) but in researching those beasts you see a car that lists for $130-140K and resells 3 years later for mid-high 50s.

Go figure.....

riknchar

Interesting discussion. By owning both of these cars, I can definitely understand the advantages/beauty of each. While the "missions" of the two cars are pretty far apart, and each (to me) doing incredibly well at meeting said mission, I was pretty surprised to learn how much variation in depreciation there was between the two.

I can say without reservation that the technological marvel that is the 600hL is significantly more car for the dollar than the SC, and that it's surprising that the two would cost the exact same for similar years/mileage/condition. if I were forced to pick one or the other to keep, I would definitely opt for the LS600, although I would miss the SC on warm summer nights...

I wonder what will happen over the next couple of years to the relative depreciation for these two cars? In 2018, will a 2008 LS600hL sell for $15K and the 2008 SC sell for $20K, or will it be the other way around? Only time will tell. I'm still convinced the LS600 is quite a bargain right now if anyone wants to own the ultimate example of Lexus luxury.

Thanks for an interesting discussion!

Wandl

I actually did this search in the Dallas area last week and agree with the assessment; figured in winter time the SC's would sell for less but boy was I wrong. It is more of an enthusiast car whereas the 600s I found were all above NADA (what my credit union uses) PLUS were in the high $20s. A LOT of car for that price...itching to pull the trigger needlessly much to the chagrin of my wife.

Higgie

These are the cars sold here in the Netherlands since 1989:

Model Total
CT 8.933
IS 5.000
RX 3.846
GS 1.405
LS 505 (No LS 400's, only LS 430 and 460/600h's))
NX 413
SC 131 (No SC 300/400's, only SC 430's)
LFA 2
RC 1

The prices of used SC's and LS's are about the same for the same year.
My guess is the LS is "just" a luxury car and the SC is a convertible luxury sportscar.
The LS is mostly sold as a company car, the SC as a private car. And most people want to have a sportcar, not a big saloon car.
(Mercedes sold about 6000 S-class in the same time period)

Nospinzone

And just to be clear that Pebble Beach Edition sold long ago. It may even have been a 2010, I really am not sure now. My only hesitation now is there have been so many technological advancements since that model was built. As I recall, Lexus did mostly cosmetic enhancements through the model years.

dal20402

The 600h really is a great deal now, and based on Prius/Highlander/RX experiences I wouldn't hesitate to pull the trigger (although on a 2008-2010 I'd assume control arms should be budgeted in). If they were available in SWB RWD form I would have definitely bought one instead of my 460... the LWB AWD car is just too big and heavy for my taste. The weight difference between a SWB RWD 460 and the 600h is 1000-1200 pounds depending on equipment -- ouch.

riknchar

There actually was no Pebble Beach edition in 2010, so it must have been a 2009. I had the '09 PB, and really enjoyed it.

The lack of new technology is actually one of the cool (or at least quaint) aspects of the SC430. The 2009 model still had a cassette player! There were very few changes through the 9-year production run (most came in 2006, with a 6-speed transmission and slightly upgrades lights and electronics).

I've sat in and/or test driven most of the Lexus models, and to me, the LS600 and SC430 were the ones with the most 'soul...' I owned an IS350C, and while it was a superior car in almost every respect to the SC, it truly lacked that feeling of being truly 'special' I always got in my SC. Hard to explain, but very true for me.

riknchar

Funny! To me, the extra weight of the 600 is an advantage, as it makes the car that much more stable and substantial. The added power and refinement of the 5 liter V-8 and the hybrid drive make up for the extra weight and make a great car (the 460) into a truly special car. It's not for everyone, though, I know.

dlbuckls10

That's a lot of extra weight and the 600h mpg is about the same as the 460. Many will definitely consider buying one as they depreciate. The 600h limited numbers, quietness, refinement and standard features gets my consideration, plus they are reliable.

tbilisi79

Because cars that cost 100k are out of reach for many people. And even those who can afford them have enough wisdom not to waste money on expensive cars.
Most of the cars that are in 100k plus range are leased. Tax breaks also come into play.
Once the high end cars hit the used market they quickly settle into the realm of things.
I find it funny that I can buy a car that used to cost 70k for 30 in 3-4 years. Hilarious for that matter. Cars are more reliable than ever, so that makes me, a used car buyer a lucky guy. I am pretty sure I will never buy a new car. Then again, I like older cars anyway.

Kennyr44

Someone has to buy them new so we can get them for a song after a few years. I bought my ls400 for $16,000 and drove it 15 years. Now I paid $19,000 for this car and plan on another 15 years.