U.S. Auto Values Hold Up Better Than Expected

Rising resale values of American cars are challenging the superior reputation of Japanese cars in holding their value, a new study of automobile leasing shows.

The analysis by Salomon Bros. analyst Jack Kirnan helped to substantiate other evidence that American cars are improving in quality. Although Japanese vehicle resale value is generally higher, the Americans are catching up.

Kirnan said demand for low-mileage, late-model used cars and resale values higher than estimated when the car was leased the first time also mean that the U.S. auto makers make more money per vehicle.

When applied across a broader spectrum of vehicles, Kirnan’s study says this means resale values of American cars are increasing faster than those of Japanese cars.

U.S. auto makers would not comment on leases, but they said the actual resale value of these cars is higher than what standard industry measuring sticks say.