The Nissan LEAF EV will lose 90% of its value in 5 years
Glass’s Guide has predicted that electric cars will lose 90% of their value in the first five years of ownership over fears of the cost of battery replacement.
Now there’s a figure to make your eyes water and you wallet bleed. Glass’s Guide reckon that the electric cars about to go on sale in the UK will lose around 90% of their value in the first five years. And with no axe to grind – just the facts and their reputation to deliver the verdict – we need to take seriously what they say.
The big problem is the expected lifespan of the battery pack, and the cost of replacement. In the first year of ownership it’s likely that electric cars – such as the Nissan LEAF pictured above – will retain more of their value than a comparable, traditionally propelled car. But as the electric cars age the depreciation accelerates dramatically (unlike the EV – sorry, couldn’t resist that) until the car is worth just 10% of its purchase price after 5 years.
To put that in to perspective – although we know you’re smart enough to do it yourself – it’s like going out today and buying a nice new Fiesta for £10k and having to flog it in 5 years for £1k instead of the £2.5-3k it would fetch. That’ll wipe out any cost saving from using untaxed electrcity instead of hightly taxed petrol or diesel.
So is there an answer? Well, we could start accepting that the electric car as a replacement for the internal combustion engine is a non-starter. We could look at it sensibly and say this is what we want in congested cities but it will never replace a real car. But that would mean accepting that we don’t need to control CO2 – although in truth electric cars are as polluting.
On any rational basis the current development of electric cars is a nonsense. No car company would be going this route if Governments weren’t penalising them based on the emission of CO2 – at the point of use – on their cars. There is no rational business argument for electric cars other than as runarounds in congested cities. The urge to produce them comes purely from Government meddling in the free market economy.
Maybe if this new coalition Government scraps the planned electric car subsidy and people realise that whatever they spend on an electric car is money down the drain we may get back to some form of common sense on this iusse.
But don’t hold your breath.
Edwin Bowerman says
I agree with those who characterize this 90%er as either a corporate lackey being paid to mouth these stupid statements, or else he really is that stupid. He claims to have a right to his opinion, true, for opinions, but much of what he says is outright lying. #1. The old worn out argument “Just trading tail pipe for smoke stack” Has been thoroughly dis-proven for many years. #2. I would like him to try & explain what values he used to come up with his 90% in 5 years lie. It can’t be battery life, Nissan’s Leaf BEV’s battery is warranted for 10 years. What’s a 10 yr old internal combustion engine car worth? #3. In the next few years it is projected the cost of gas will skyrocket. Pick your own guess the price then using any national mileage standards traveled, figure the fuel savings minus the electricity. The Ev will have returned 100% of its cost Plus a huge bonus. Guess what, the EV will still not be worn out, and still retain a high relative resale value.
CarsUK says
All the data we quote is NOT our made up POV. The 90% depreciation is a figure compiled by residual value experts for lease companies to use when fixing rates. The Royal Academy of Engineers believes electric cars will do nothing to reduce CO2 levels. Gas, or petrol as we know it, won’t ‘Skyrocket’ in the next few years. The US may have to come to terms with being taxed the way the rest of the world is, but that’s not the same thing.
Oh, forgot to say. Nissan have not yet given ANY warranty on their battery packs. If it’s ten years you can probably expect Nissan to go bust.
rick ehrlich says
you have really bought into (or maybe are being paid by?) the status quo car and oil interests. your statement is ridiculous to begin with, if you are such a great forecaster, why are you not rich as god? the reason it is so hard to access a good used electric car today (even in the small NEV market) is because people don’t want to get rid of their little e-car with such amazing properties, which basically never break. oem’s supply them with fancy expensive (relatively ) no-maintenance (lead acid batteries, but most replacements are in the much cheaper wet batts, now down to $60 for a 160 amp hour 12 volt. same principle will apply in the Leaf or any new gen e-car. by the time it needs new batts, their cost will be way way way down. your only (unstated) rationale for your 10% value statement is, the present high cost of lithium batts. bet your fortune this cost will drop off a cliff with high volume, which should make used e-car value hold well. it will change the car repair market, as they have so few moving parts, not much to break ! without repeating all the huge reasons e-cars are INEVITABLE (oil wars, military strategy, imported oil addiction and effect on economy, polluting the earth more and more, noise, ick factor, women who hate to fill the tank because it smells, their hair blows in the wind etc), you just sound like a moron. sorry, but this is how i see it.
CarsUK says
The joy of the world is difference. And today I’ve been called a moron and a ‘Corporate Conservative Lackey’! For having an opinion as valid as yours. An opinion shared by the majority of staff at Cars UK. And the majority we speak to in the motor industry.
I’d refer you to my reply to the previous commenter. And to the points made by the Royal Academy of Engineering. And Honda. Who by your definition are also morons.
That said, we welcome the argument!!
Roger Dobronyi says
It is most evident that this article was written by a conservative corporate lackey! A person that pushes a fossil fuel vehicle in the face of that resource depletion is either in denial or stupid or maybe driven by greed! I don’t know where he obtained information stating that electrics are just as poluting as gasoline vehicles. I would like to see a gasoline vehicle fuel up from a wind turbine, a solar panel,a hydroelectric plant or a nuclear powerplant. It has been shown even if the powerplant is coal, that the net result is still cleaner than any gasoline powered vehicle. It is plain to me that this is just another attempt to misinform and destroy an electric car market. People like this do more than deter electric car sales. They hinder the development of alternative transportation by clinging to a mode of transportation that will in the near future be too expensive to drive. Ethanol and hydrogen are net energy losers so electric is a standout as a viable mode of transport. Since each autombile manufactured requires an investment of 90 barrels of oil, I would suggest the repowering of gasoline vehicles on the road with electric. Saving that huge quantity of oil as these vehicles have already paid that price!
CarsUK says
LOL! Never been called a ‘Corporate Conservative lackey’ before!
We need to be realistic. The Royal Academy of engineers says that it would take six nuclear power stations to power the UK’s cars if they were all electric. It also states that even if all cars ran on electric it would make no difference to CO2 levels. And of course, you first have to fall for the theory that CO2 is a problem.
Fuel cells are the future. BEVs are a stop-gap sop to Govt tax filled targets and will never replace the internal combustion engine. Best we stop kidding ourselves they will. Honda say it will be at least 20 years before battery technology is even viable as an alternative to internal combustion. So why bother with it now?