Used car mileage and depreciation: the formula and what actually drives it

By Auto Intelligence Network · Published September 14, 2026

Depreciation is usually modeled as two curves: one for age and one for mileage. The shapes are well understood, but the rates that drive them are not universal constants — they depend on the vehicle segment, the powertrain, the brand's reliability reputation and current supply. That is why a formula with a fixed rate can be a useful sketch and a poor estimate. The dependable approach is to let comparable vehicles at similar age and mileage set the rate for the car in front of you.

The two curves

Age depreciation is the loss of value from time alone: model-year turnover, newer features, warranty expiry and the market's preference for recent vehicles. Mileage depreciation is the loss from use: wear on mechanical components, the approach of major service intervals and the buyer's expectation of remaining life. The two overlap — an older car usually has more miles — but they are priced separately, which is why a low-mileage older vehicle and a high-mileage newer one can land at similar values.

The age formula

The common model is geometric: each year the vehicle retains a fixed share of the previous year's value.

value_t = value_0 × (1 − r)^t

value_0 is the starting value, t is the age in years, and r is the annual rate. The rate is the whole problem: it differs by segment and model, is steepest in the first years and flattens later, and shifts with market conditions — so a rate borrowed from a generic table is the least reliable input in the equation.

The mileage adjustment

Mileage is usually handled as an adjustment relative to what is typical for the vehicle's age. A car with fewer miles than expected is adjusted upward; one with more is adjusted downward.

mileage adjustment = (expected miles − actual miles) × rate per mile

Expected miles are the age in years multiplied by a typical annual figure — US federal transportation data has long put the national average at roughly twelve to fifteen thousand miles a year, and valuation guides commonly use a baseline in that range. The rate per mile is not a single constant either: it is higher for vehicles whose value is dominated by mechanical life and lower for those where age, features or scarcity dominate.

What moves the rates

Two vehicles with the same age and mileage can depreciate at very different rates. The main drivers:

Segment — pickup trucks and some body-on-frame SUVs have historically held value differently from sedans of the same age, because demand and use patterns differ.
Powertrain — for electric vehicles, battery health and remaining range carry weight that odometer mileage alone does not capture; for hybrids, the hybrid system's warranty status matters.
Reliability reputation — models with a strong record of low-cost ownership retain value at high mileage better than models with known expensive failure points.
Supply — a model in short supply on the used market depreciates more slowly until supply recovers; the reverse is true when a segment is oversupplied.
Use profile — commercial or fleet use, evident from service records and wear, is priced differently from private use at the same odometer reading.

Estimating it for a specific car

Rather than choosing a rate, let the market reveal it.

Find comparable listings for the same model and model year near you, and note their mileage and asking prices.
Read the price difference between the lower- and higher-mileage examples; that spread is the market's current per-mile rate for this model.
Place your vehicle on that spread by its mileage, then allow for its condition, options and history.
Where the comparables are thin, widen the model-year range or search radius before falling back to a generic rate.

Where the formulas break down

Very low mileage on an older vehicle does not add value in proportion to the formula — seals, tyres and fluids age regardless of use, and buyers price that in. Very high mileage on a newer vehicle raises questions about use profile that a per-mile rate cannot answer. Branded titles, accident history and missing service records all sit outside the age and mileage curves and must be handled as their own adjustments.

An AIN valuation derives the effective mileage adjustment from live comparables for the specific VIN and lists it as its own line item, so the rate the market is currently applying to your model is visible rather than assumed.

Common questions

How many miles a year is considered average?

US federal transportation data has long put the national average at roughly twelve to fifteen thousand miles a year, and valuation guides commonly use a baseline in that range to define expected mileage for a vehicle's age. The right comparison is always to vehicles of the same model and age in your market.

Does mileage or age matter more?

It depends on the vehicle. For models whose value is dominated by mechanical life, mileage carries more weight; for models where features, scarcity or brand reputation dominate, age matters more. The comparables for a specific model show which effect is stronger at the moment.

Is there a single depreciation rate I can use?

Not reliably. The annual rate differs by segment, model and market conditions, and it changes over a vehicle's life. A fixed rate gives a sketch; comparable vehicles at similar age and mileage give an estimate.

Does high mileage matter less on some cars?

Yes. Models with a strong reliability record and low-cost ownership tend to hold value at high mileage, because buyers expect useful life to remain. The same mileage on a model with known expensive failure points is priced more severely.

How does AIN compute the mileage adjustment?

From live comparables for the specific VIN's model and model year in your market, rather than from a fixed per-mile table. The resulting adjustment is shown as its own line in the report, separate from title history.