The Brain Bucket

Value of the Ride: How a Motorcycle Depreciates

Mar 24, 2021 3:23:43 PM / by Logan Reed

Motorcycle Depreciation: How Much Is My Motorcycle Worth?

By now, I’m sure you know which way I lean when it comes to buying new vs. used motorcycles. Can you blame me, though? Especially when you take motorcycle depreciation into account for a new bike? Oof.

All things considered, though, I understand that details like depreciation may never factor into someone's purchasing decisions. After all, depreciation happens wayyy down the road, right? Well, not exactly.


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What is the depreciation rate on a motorcycle?

According to the ‘BikeSocial’ page on Bennetts, a brand-new motorcycle’s value drops nearly 20 percent during the first two years of ownership, and this figure doesn’t even include mileage or overall condition. The biggest hit to value typically occurs during the first year of ownership (unless you own a sports bike or tourer), with a depreciation loss of 12.5 percent.

To put this into perspective, let’s say you’ve just purchased a $12,000 bike right off the showroom floor. Then, 12 months later, despite your attempts to keep it pristine and running smoothly, your bike is now worth $10,500—that’s $1,500 less valuable than the day you bought it. Ouch. 

Normally, I’m not one to split hairs over a bike that’s worth $10,500; but, when that same bike was worth $1,500 more the previous year, I have to wonder if the owner had the foresight to do a little bit of digging on motorcycle depreciation before making the purchase. I’m betting not, which can be said for many consumers, unfortunately.

Motorcycle depreciation

How much is my motorcycle worth years down the road?

Sadly, your brand-new bike is going to continue depreciating pretty significantly the first 3-4 years you own it. The good news is, is that when the bike is 5-6 years old, the depreciation rate on bikes begins to stabilize, and, this time, mileage and condition are taken into account. Now, instead of losing $1,000 or more as your bike ages, the depreciation value gets cozy in the $300-350 range per year (you can stop kicking yourself now).


Factors That Contribute to Depreciation

As we said above, depreciation and motorcycle resale value depends on different factors, so let's dig in a little more to the specifs.

  1. Vehicle condition - In general, the closer your motorcycle matches it’s original quality the more value it has. If the condition of your motorcycle is great, well cared for, it will be appreciated by dealers and individuals alike. Even with miles and age.

  2. Vehicles Miles - Motorcycles are typically on the road a lot less than cars, with the average reportedly traveling between 2,000-3,000 miles per year. Motorcycle miles also work in thresholds. A bike with 9,000 miles holds more value than a motorcycle with 12,000 miles, but maybe not more than a bike with 9,700 miles. In another example, a bike with 15,000 miles will hold more value than a bike with 20,000 miles, but not necessarily a bike with 17,000 miles.

  3. Proper Maintenance - For those that keep detailed maintenance records, you have an advantage as you can use it as verifiable proof to the vehicle’s history. A properly maintained vehicle greatly reduces the chances of surprise mechanical failures and thus make selling the motorcycle easier.

  4. Vehicle modifications - Modifications can go both ways. They can either increase the value or even do the opposite. In most cases, if modifications were done, you shall proceed with the expectation that you won’t make 100% of the money you put in back. Most dealers will take wheels, tour packs, bags, engine modifications, and exhaust into consideration. Things that cost more to install and modify. Anything else like small accessories make little to no difference in value.

  5. Seasonality - motorcycles can be worth more during riding season ie: spring and summer months vs the winter and fall months. As one can imagine, you have more of a propensity of getting out on the road where conditions are more ideal than the contrary. During these times, the buy and sell market are more active.

  6. Rarity - Low production numbers, special limited editions, and/or motorcycles that played a critical part in history may be more sought after and command a premium price.
    Age of the vehicle - The age of the vehicle is impacted mainly due to newer year model prices when released. A pre-owned bike is not worth what a brand new model would be worth. This is especially true with same year models. A used 2021 will take a deep hit due to it competing directly with a new bike manufacturer pricing.

  7. Number of owners - In some circumstances the number of owners can have a perceived impact on the value of the motorcycle. For example, a buyer with a preference of buying from a single owner that has proven to take proper care of the vehicle would command a higher price vs one that has had multiple owners. Although it plays a small factor in overall motorcycle valuations relative to others, this is used as an advantage in peer to peer/classified marketplaces.

  8. Number of accidents - Similar to cars, if your motorcycle was in an accident that needed repairs, it will impact the value negatively. For the buyer that does their due diligence, they will discover misaligned panels and the deformed frames if the bike was repaired improperly. With that said, it is worth mentioning that the vehicle condition is primarily the objective measure of the valuation of the bike and typically not specific to the number of accidents.

What are the advantages of buying new vs. used motorcycles?

How much is your motorcycle worth?

At the end of the day, what’s considered an advantage to one person may be considered a drawback to another. For example, some people think, "If I buy used, then I’ll keep more money in my wallet, but the bike won’t feel like my own." This is more or less true. But if you’re willing to put in the elbow grease to customize it, then I’d say you do you!

When you buy used, not only are you saving money in terms of the cost of the bike, you’re also avoiding the regret the original owner is likely feeling after calculating just how large their depreciation loss was during the years the bike was still considered ‘new.’ Used motorcycle values just can’t be beaten in the long-run, folks.


Are there motorcycle brands that depreciate faster than others?

There are, actually. According to InsuretheGap.com, new models by Honda, Yamaha, and BMW tend to depreciate faster than other brands, at a rate of 27, 22, and 20 percent respectively (percentages were determined by calculating the mean depreciation value of different models within the Honda, Yamaha, and BMW brands, between the years 2015 and 2018). But don’t let this deter you from buying one of these babies used!

Perhaps even more important than the brand, though, is the type of bike you’re considering, because what’s ‘in’ one day might not be the next, which has a huge impact on supply and demand (or oversupply and not enough demand), and, consequently, on depreciation value.

 

Itching to know what your bike will be worth down the road? Check out The Truth Behind Buying a Brand-New Bike on the Brain Bucket Blog and do the math!

 


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Topics: Articles, Motorcycles, The Brain Bucket

Logan Reed

Written by Logan Reed

Rider. Writer. Harley life-r. Follow my coverage of everything from tips for motorcycle riders, to motorcycle humor, and everything else to do with living life on two wheels.

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