Why Beauty Counts
In a cookie-cutter car market, gorgeous shapes and cool interiors are worth their weight in resale value
By Lawrence Ulrich

(MONEY Magazine) – When some magazines rate cars, they pretend that design and styling don't matter. Because handsome lines and a pleasing interior can't be measured, goes the reasoning, they can't really be said to add value to a car. Puh-leeze.

Individual tastes differ, but the public's collective opinion of a car's looks has always been a major driver of demand. Buyers ignore it at their peril. Counterintuitive as this may sound, strong demand isn't necessarily bad for a buyer; while it may mean a steeper purchase price, the extra investment often more than pays for itself in the form of a higher resale.

As today's leading car makers converge in quality, safety and features, design is often the factor that lifts a car out of a field of solid competitors. A case in point is the Chrysler 300 sedan (above). The car earned a Best Value from us (along with kudos from many other critics) largely on the strength of a design that combines classic American cruiser with modern swagger. According to Autofastracks, which provides data for MONEY's tables (starting on page 110), the Chrysler is projected to fetch 33% of its original sticker price after five years. That's safely above the resale value of most Detroit-badged sedans and considerably higher than the expected resale of other cars bearing the Chrysler nameplate.

The ideal design from a buyer's point of view is one that not only turns heads now but is also likely to do so years into the future. The redone Ford Thunderbird, for example, was widely hailed for its retro design when it was released in 2001. But mediocre performance and a price tag of $40,000-plus dried up demand within two years. BMW's little Mini Cooper, by contrast, reinforces its spunky looks with one-of-a-kind handling and lots of safety features. The Mini is expected to command 49% of its sticker price after five years on the road, by far the best among small cars.

THE MORAL Design adds the most value when it's part of a complete package that includes distinguished performance and a fair price. Beauty matters. But all by itself, it's only sheet-metal deep.