Depreciation Station: 1997-2006 Jaguar XK8


Written by The Staff of Motorsport Marketing

From the Nov. 2012 issue

Posted in Buyer's Guides

Story By Andy Reid

The XK8 was the first all-new sporting Jaguar since the introduction of the XJS in 1975, and it seemed to be the answer to what Jaguar owners had been asking for. It looked like a mix of the E-type and the Aston DB7 and was a sensation from the start.

The interior was just as nice as the exterior, featuring the Jaguar trademarks of Connolly leather, Wilton wool carpets and more wood on the dash than in any previous Jaguar. Add to that climate control that worked and modern conveniences like parking assistance, and you had a truly world-class car.

Jaguar also offered a pair of body styles, with the traditional coupe joined by a convertible. During the model run, in fact, the open car outsold the coupe by a huge margin.

When new, the XK8 was an expensive car with a base price in coupe form of $70,495; the convertible went for $75,495. The good news is that, today, you can get a very nice coupe or convertible for as low as $7000, with cars now topping out around $18,000. We’d say the average price is about $12,500 for a nice, low-mile example.

The new XK8 had go to match its show: a brand-new, Jaguar-designed, 4-liter V8 featuring four cams and 32 valves. This was the first new engine for Jaguar since the introduction of the AJ6 a decade before.

Unfortunately for some, the XK8 only came equipped with an automatic transmission, but even the griping about the slushbox diminished over time. The car had impressive performance figures, traveling from zero to 60 in a very respectable 6.4 seconds and a quarter-mile time of 14.8 seconds.

In 2002, the engine displacement was upped to 4.2 liters, and the four-speed, ZF-sourced automatic was upgraded to a Mercedes-Benz five-speed unit. Performance picked up a bit but, more importantly, the engine also received an upgraded water pump, better chain tensioners, and cast-iron cylinder liners.

It had been a while since we’d driven an XK8, so we borrowed one from our friend Dean Cusano at Motorcars in Plainville, Connecticut. He had a 2002 coupe with 91,000 miles on his lot. After driving a few miles, we remembered just how good these cars are: amazing looks, great performance and many modern features. His asking price is only $11,900, which seems like an amazingly great deal for such a nice car.

Care and Feeding: The 4-liter engine used on the earlier cars does have some issues in its past. In some cases, the Nikasil coating applied to the cylinder walls flaked off, leading to a drop in compression. Bad engines were typically replaced under warranty.

These engines were used until mid-2001, but don’t worry too much about it. Simply have a compression test performed. If the car has good compression numbers at this point, this problem is unlikely to rear its ugly head. If you are still concerned about the engine, simply buy a 2002-or-later model and drive worry-free.

Other issues are the water pump and chain tensioners. Both are prone to premature wear and have been superseded by the parts used in the later 4.2-liter engine. If these have not been attended to, just factor their replacement into the cost of the earlier 4-liter car. Since the car has an interference engine, you want the later tensioner system; the later water pump is preferred, too.

If you want to save a little money, simply buy the parts and follow one of the many online tutorials to replace them yourself. The jobs are not too difficult.

Last Piece of Advice: At these kinds of prices, the XK8 may be the GT car deal of the century. The XK8 compares very favorably with another British legend, the Aston Martin DB7—and in some ways it may be the better car.

So entertain those James Bond notions on a budget, and go get yourself an XK8. We would recommend a coupe, say a silver one with black leather.


Want to learn more about Jaguars, attend events and peruse forums? Check out the Jaguar Clubs of North America site:

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