The mystery of new electric cars is that nobody can predict their future value.

[TAG0][TAG2]

• 
  The prices of electric cars are falling, and so are the prices for used EVs.
  
• 
  However, it is difficult to determine how an EV has depreciated without historical data.
  
• 
  There are many factors to consider when evaluating an used EV.
  

While resale value is a key consideration for car-buyers for many years, the shift to electric may change the industry's data on vehicle depreciation. This is a problem because consumers want assurance that the EV that they are buying is worthwhile and that they will be able to sell it later.

This is a pretty simple equation in the world of gas-powered cars.

Anderson Economic Group founder Patrick Anderson told Insider that they have decades worth of information that gives buyers of high-end pickup trucks a lot more confidence that they can sell the vehicle in five years for a substantial portion of what they originally paid.

The electric future is not so simple. Anderson stated that no one knows what the future will look like for a Cybertruck, F-150 Lightning, or Lucid Dream Edition.

The data is just too sparse at the moment. The majority of information we have about used EVs is gathered from Tesla. Even that data can be unpredictable. According to iSeeCars.com Tesla's Model 3 has only lost 4% over three years. However, recent discounts have prompted a drop in prices on the second-hand market.

No one knows the value of a used EV.

Edmunds analysts suggest that the way used luxury and nonluxury gas-powered cars depreciate may not apply to used electric vehicles.

According to Steve Patton (EY Americas mobility sector leader), car-buyers don't always weigh the same factors when buying an electric car or a used gas-powered vehicle.

Patton spoke of gas cars, saying that mileage was an important indicator about the vehicle's value. "We know that it's not always a good indicator of the battery's health."

It's unclear how today's high-end product mix (77% of EVs were luxury in Q4 per Anderson), combined with the introduction and affordability of more affordable EVs will impact the future shape of the used EV market.

The data we have about used EV sales prices might not be applicable to the new cars. According to iSeeCars, the Nissan Leaf's value had declined 49% over five years.

However, battery technology is expected to improve even if they don't make the same leaps as between the first and second generations of EVs.

It is not clear whether technology of today will decline faster or slower than older tech.

[TAG1][TAG3]

Here are some things car-buyers need to remember

A prospective buyer of an EV should consider the factors that a potential buyer might be interested in. For example, whether the battery was stored in a warm or cold environment.

Patton stated, "We need to understand not only that the battery holds its charge, but also the history of that particular battery." This is crucial in understanding the residual vehicle value.

Anderson stated that the four-year-old used Tesla data was historic because it "indicates there's substantial depreciation and that a buyer who buys an electric vehicle used has to be very concerned with the battery."

Anderson said that it would vary by manufacturer and type. Anderson said, "It's just uncertainty for buyers and something which is going to weigh down, especially mass market buyers who aren't likely to have the extra disposable income necessary to absorb a $20,000-$30,000 depreciation hit within a few years."

These are changing things, and the price used EV-buyers will pay for them may change. One's selling price may be lower this year due to a flood of Model 3s on the market. The used market is also affected by the new EV tax credits that will bring down the price.

EV-owners have the option to track their battery using tech like Recurrent's. This allows them to distinguish their EV when it comes time to resell.

—————————————————————————————————————————————
By: astjohn@insider.com (Alexa St. John)
Title: New electric cars come with a built-in mystery: Nobody can predict their resale value
Sourced From: www.businessinsider.com/electric-car-vehicle-resale-value-mystery-tesla-2023-1
Published Date: Tue, 24 Jan 2023 11:56:00 +0000

Related posts:

Tesla must act more like GM or Toyota if it wants to win this race. Tesla’s price drops have triggered an increase in buyer curiosity Wedbush’s Dan Ives claims that Tesla stock could climb 35% after recent price cuts in China. Another Tesla Semi was apparently found broken down along the side-of-the-road