Dodge wants the new Charger to revive its image as a car brand. An influential analyst of long-term vehicle value has boosted that hope.
Automotive Lease Guide forecasts that the 2006 Charger will be worth 47 percent of its sticker price, on average, after 36 months.
That percentage is higher than or on a par with the Charger's chief competitors, ALG says.
Dodge is shipping the Charger to dealerships now. It has a base list price of $22,995, including freight.
Many of the cars with which the Charger will compete initially are 2005 models. The 2005 Ford Five Hundred has a projected 36-month residual value of 45 percent.
Another domestic competitor, the 2005 Chevrolet Impala, is projected to hold 36 percent of its sticker price after 36 months. Chevrolet is restyling and re-engineering the Impala for 2006.
And the Charger's resale-value percentage is virtually the same as that of the 2005 Nissan Maxima (48 percent) and the 2005 Toyota Avalon (49 percent).
A higher residual value for the Charger permits lower monthly lease payments, because lessees must finance a smaller portion of the total price.
A high resale value also is likely to enhance the Chrysler group's efforts to bring sticker prices closer to transaction prices.
The Charger is an important part of Dodge's plan to establish itself as a car brand.
Last year 78 percent of Dodge's U.S. sales were trucks.
Automotive Lease Guide, of Santa Barbara, Calif., is considered the industry benchmark for establishing resale values. President Raj Sundaram concedes that residual values of Dodge cars tend to be low.
But he predicts the Charger "is going to be well-built. It has curb appeal."
Sundaram notes that the Charger is built on the same rear-wheel-drive platform as the Chrysler 300 sedan. Resale prices of used 2005 Chrysler 300s are running higher than expected, he adds.
Automotive Lease Guide predicts the 2006 Chrysler 300 will be worth 50 percent of its sticker price, on average, after 36 months. By contrast it projects a 36-month residual value of just 27 percent for the 2004 Dodge Intrepid, which the Charger is replacing.
Automotive Lease Guide bases its residual-value predictions on such factors as segment competition, new-vehicle prices and a brand's history.
Sundaram says the Chrysler group's pledges to limit new-vehicle incentives and Charger fleet sales "make us feel more confident" in projecting a strong residual value for the Charger.
Chrysler group spokesman Kevin McCormick says the company's internal projection of the 2006 Charger's residual value is "slightly better" than Automotive Lease Guide's estimate. He would not provide specifics.
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