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How to use
- Enter Purchase price.
- Enter Current value.
- Enter Years.
- Calculate, then review units and consumption or cost assumptions before comparing.
How it is calculated
Annual decline = [1 − (current value ÷ purchase price)^(1/years)] × 100
Example
A fall from 120,000 to 90,000 over 3 years means 25% total depreciation and about 9.14% compound annual decline.
Important notes
This is an equivalent compound rate, not the actual loss in each year. Vehicle value can fall quickly in one year and slowly in another.
Worked examples and interpreting results
| Case | Calculation | Result |
|---|---|---|
| Total depreciation | (120000 − 90000) ÷ 120000 × 100 | 25 |
| Annualized | [1 − (90000 ÷ 120000)^(1 ÷ 3)] × 100 | 9.14397 |
Frequently asked questions
Was the rate actually the same every year?
Not necessarily. It is an equivalent rate that links the starting and ending values mathematically.
Is the result an estimate or an actual cost?
It is a calculation based on your inputs. Actual prices, consumption and fees can vary by vehicle, route and energy source.
How should two scenarios be compared?
Use the same distance, period and units, and change one variable at a time where possible.