Losing value fast! The top 5 fastest depreciating cars
Picture this: you’ve just picked up your shiny new car. It’s spotless, smells incredible, and you can’t resist glancing back at it every time you park. But the moment you drive off the forecourt, something invisible happens - your car’s value starts dropping, fast. It’s called depreciation and for many drivers, it’s the hidden cost of car ownership that no one warns you about.
If that car is written off or stolen, your insurer will only pay what it’s worth today - not what you paid for it. And that’s where GAP (Guaranteed Asset Protection) insurance comes in; it pays the difference between your insurer’s payout saving you from financial loss.
What is Depreciation?
Depreciation is the natural decline in your car’s value over time. In the UK, new cars typically lose between 15-35% of their value in the first year and up to 60% within three years. Factors like mileage, condition, popularity and even fuel type all play a role, but the biggest drop happens as soon as the car leaves the showroom.
Imagine spending £30,000 on your dream car. Two years later, it’s worth just £18,000. If it’s stolen or written off, that’s all your insurer will pay, leaving you thousands out of pocket, or worse, paying for a car you no longer have if it’s leased or on finance.
The Top 5 Fastest-Depreciating Car Models
5. DS Automobiles DS3 E-Tense – Starting off our list the DS3 is an all-electric SUV with a relatively poor range compared to its competitors combined with cramped space in the back means that after 3 years averaging 12k miles a year it only retains 28.9% of its original value.
4. Lexus UX-e 300e – Not a brand typically associated with fast depreciating models, but the UX-e is breaking the mold for the premium Japanese brand. Continuing the theme, it’s another electric SUV with poor residual values after 3 years/36k miles, it retains (a marginally lower) 28.6% of its original value.
3. Jaguar I-Pace – The last of the electric SUVs on our list is the Jaguar I-Pace, cyberattacks aren’t the only thing troubling JLR currently. Over 3 years averaging 12k miles a year the Jaguar holds just 28% of its original value, losing 72% over 3 years! This equates to the largest financial drop on this list with over £50k in value lost in 3 years!
2. Nissan Leaf – A staple of the EV world the Nissan Leaf first went on sale in 2009 as one of the first mass production electric cars. However, it always suffered from the poor residual values with second-hand buyers skeptical of the EVs reliability and range as they get older. This unfortunately makes the second-generation Nissan Leaf the second highest depreciating car on UK roads retaining a meager 26.5% of its original value after 3 years/36k miles.
1. GWM Ora O3 – This Chinese electric hatch suffers from a tiny boot, poor infotainment system and poor handling compared to its competitors Renault and Nissan. This combined with an unknown branding - Ora means that after 36k miles it holds just 25.8% of its original value. A depreciation rate of almost 75% in 3 years meaning it loses almost £24,000 in value!
Why Depreciation Can Cost You More Than You Think
Standard car insurance only covers the current market value of your vehicle. It doesn’t matter if you bought it last week or last year - the payout reflects what it’s worth now, not what you paid.
That means if your car was £30,000 new and your insurer values it at £18,000 after an accident, you’re £12,000 short. If the car was financed and you still owe £25,000, you’d be left covering a painful £7,000 gap yourself.
That’s exactly the kind of situation GAP insurance is designed to protect you from.
How GAP Insurance Works
GAP insurance steps in when your car is written off or stolen, bridging the difference between your insurer’s payout and what you originally paid - or still owe.
Policies tailored to your vehicle purchase: We off a range of 5-star Defaqto-rated GAP policies, designed to match how you purchased your vehicle. The include:
Return to Invoice (RTI) GAP
- For new or used cars purchased with cash, a loan, or a Personal Contract Purchase (PCP)
- Covers the difference between your car's original invoice value and its depreciated market value at the time of write-off
- Can be purchased up to 6 months after vehicle purchase
Return to Value (RTV) GAP
- For cars purchased more than 6 months ago
- Covers the difference between your car's value when the GAP policy was bought and its market value at write-off
Lease and Contract Hire GAP
- For vehicles on a lease or contract hire
- Covers the difference between your insurer's payout and the outstanding balance on your lease or contract hire, including early settlement charges
Unlike standard insurance, GAP Insurance only kicks in for total loss situations. But when you need it, it can make all the difference.
When GAP Insurance is Worth It
GAP cover is especially useful if:
- You’ve bought a new or nearly new vehicle (since depreciation hits hardest early on).
- You’ve taken out finance or a lease, particularly with a low deposit.
- You drive a car that’s known to lose value quickly.
- You’d struggle to cover a large shortfall from your own pocket.
It may be less essential if your car is older or bought outright - but for most new car owners, it’s an important safety net.
Minimising Depreciation (and Stress)
While you can’t stop depreciation, there are ways to slow it down:
- Choose models with a reputation for holding value.
- Keep up with regular servicing and maintenance.
- Limit mileage where possible.
- Avoid modifications that could hurt resale appeal.
- And, of course, consider GAP insurance as your financial safety net.
Final Thoughts
Depreciation is one of those things that most drivers don’t think about - until it’s too late. It’s the silent cost of car ownership that can turn an insurance payout into a financial setback.
GAP insurance is a simple, affordable way to protect yourself from that risk. If the worst happens, it ensures you’re not left paying for a car you no longer have, helping you get back on the road without a financial headache.
If you’ve just bought a new vehicle or are planning to, now’s the perfect time to explore GAP insurance with MotorEasy - and drive away knowing your investment is fully protected.
