Badge Engineering: Does Badge Engineering Impact Car Resale Value?

Badge engineering usually isn’t just done for no reason. It’s often because some brands are more popular in certain countries, so the manufacturer figures the product will sell better with a different name slapped on it. Sometimes, though, it’s about testing the waters — selling a car under another name to see how it does. Honestly, it’s tough to pin down their exact reasons because there are so many possibilities.

Take the Suzuki Swace, for example. You probably know it as the Toyota Corolla Touring, and they sell it in the UK. I’m not sure if Toyota UK just doesn’t bother selling the Corolla themselves, but honestly, it doesn’t make a difference to the price or anything like that. At the end of the day, it’s still a Corolla—just with Suzuki badging slapped on it.

So, why do they do this? Well, there are a bunch of reasons. For one, Suzuki might not have a sedan lineup that works in the UK right now (maybe due to British regulations or something), so they team up with Toyota. Or maybe Toyota has extra models lying around that can be rebadged and sold under other brands, like the Corolla Touring. Either way, Toyota doesn’t lose out, Suzuki gets a car to sell, and everyone wins.

Another example? The Toyota Supra MK5. It’s basically a BMW Z4 with some cosmetic tweaks. Even the parts still say “BMW” on them—you can see it all over the internet. The Supra’s selling price and market price are usually the same. Sometimes you’ll find it sold for cheaper (depending on the market), but overall, the price doesn’t really change much. The car still sells for roughly the same amount.

Now, when it comes to second-hand prices, I don’t think the BMW Z4 is much different from the Supra. Maybe the Z4 is a little pricier just because, you know, it’s a BMW. But generally, the prices are pretty similar. The market doesn’t seem to care much about the difference, though it does depend on the specific market conditions.

The real issue here is how the market views a brand. Take the UK, for example: Suzuki is seen as more of a lower middle-class brand, while Toyota sits firmly in the middle-class category. So, if you look at the Suzuki Swace, it’ll probably be priced a bit below the Toyota Corolla Touring—mostly because of brand perception. People who don’t like that perception might even slap a Toyota badge on it to make it “look better.” Brand perception plays a big role here, and cars with weaker brand reputations usually end up being cheaper.

The same thing happens in Indonesia. Toyota and Daihatsu share several car models, with Daihatsu versions usually being cheaper. Of course, that comes with fewer features, but overall, the cars are pretty much the same. Because of brand perception, though, people tend to think Daihatsu is the “budget option,” and that can slightly impact resale prices—but not by much. I think this happens partly because Toyota models generally have better features.

On the other hand, branding matters a lot. For example, Suzuki couldn’t sell a Toyota Crown even if they tried—it's just not their lane. The manufacturers know which brand fits which market.

That said, the price difference isn’t huge—maybe less than 15% in the used car market. For new cars, the prices are often identical. Sure, there are some small differences in features to help set the brands apart, but they’re minor. The resale value does differ a little, though, because the two brands target slightly different markets.

Badge engineering doesn’t really change the market price of a vehicle. It’s more about giving a company a way to enter a different product segment or diversify their lineup. But in terms of pricing, it doesn’t make much of a difference.