Report: EV resale values to tankby Drew Johnson
Electric vehicles will carry a high price of entry when they finally come to market, but a new report suggests EV will become virtually worthless within five years.
One of the biggest sticking points of electric vehicle technology is the high costs associated with advanced battery systems, but a new report suggests that low resale values could be an even bigger hurdle for EV acceptance.
According to a new report from the car valuation experts at Glass's Guide, electric vehicles are currently poised to post the industry's highest depreciation rates, thanks to the relatively short lifespan of EV batteries. Glass's Guide warns that unless manufacturers lease or warranty EV battery technology, the vehicle itself would be worth just a fraction of its original value in five years.
"If cars and batteries are sold rather than leased, and no special warranty cover is in place, the typical EV will retain only 10 per cent of its value after five years," warns Andy Carroll, managing director of Glass's.
The reason behind that sharp decline has to do with battery technology. Whereas a typical gas or diesel-powered car can easily last for 10 years or more, the battery pack in an electric vehicle is expected to have a useful life span of just 8 years. An electric vehicle battery is expected to cost about $11,000 to replace.
Many automakers have yet to decide on an EV selling scheme, but Nissan has already confirmed that it will both sell and lease its upcoming EV. However, those considering purchasing the Leaf outright should consider this - the $32,780 Leaf could be worth just $3,278 by 2015.
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