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EVs May Be Worthless After Batteries Are Depleted

 
13 2,244 views March 15, 2010

Renault Fluence EZ concept, 2009 Frankfurt Auto Show

Renault Fluence EZ concept, 2009 Frankfurt Auto Show

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Residual values are perhaps one of the most important aspects of car ownership.  Residual values determine monthly payments, lease rates, costs of ownership, and on and on.  When new vehicles are released, it is often difficult to accurately determine residual values until several years later when the market demand determines value.

What about determining residual value for new technology such as electric vehicles?  This discussion has many concerned sides.  What will an EV be worth 5 years from now or 10 years from now when its $10,000 battery is no longer useful?  Will the vehicle hold any value?

According to a UK based research firm called CAP, the answers to the questions above remain of particular concern, but reliable answers are still unavailable.  CAP proclaims that they are "the premier provider of used and future residual values date", however even they are unable to answer the questions.  As they said, "reliable future residual value forecasting is currently impossible."

Though they are unable to determine real residual values of electric vehicles, they did offer some insight based on their findings in commercial electric vehicle studies.  As they stated in their press release, battery replacement costs render commercial EVs worthless after the expiration of the warranty.  In addition they added, it's unlikely that high mileage EVs will retain any residual value.

CAP is currently investigating EVs to understand future residual values and have stated that they will release their results as soon as possible.

As many are aware, residual values are one of the most significant aspects of vehicle ownership.  What will an EV be worth down the road?  Any guesses?

Source:  CAP via AutoBlogGreen





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Comments (13)

  1. By  Paul Lamb Posted: 3/15/2010 3:28am PDT

    What a load of Rubbish. If anything is going to hold it's value it will be a well styled and crafted EV. How much do you think a Hummer will be worth when the price of petrol is three times or more what it is now?
     
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  2. By Chris O Posted: 3/15/2010 3:40am PDT

    The only basis for a prediction is probably Ebay value of used RAV 4 EV's at this point and they are still worth roughly what they cost new 10 years ago. Of course the long lifespan of NiMH batteries and forces of (scarce) supply and demand play an important role here. BEV technology is long lasting and low maintenance so it makes sense to expect lower depreciation rates than ICE vehicles. The batterypack plays a separate role at this point. How long will it last in real life, what's the residual value for other uses once it lost too much capacity, how fast will battery cost come down will be factors. But even so: what if after 8 years your Nissan Leaf is still in great shape but the battery is down to 80% of it's capacity. A new battery will cost a lot less and have far better range (assuming improvement in technology) than the old one so you actually wind up with a better car. If after 14 years the Leaf starts to fall apart a battery which still has some mileage left in it could be transferred as a pack to a similar vehicle or at a sub pack level to a vehicle with a differently shaped pack. So it may be useful to treat the value of the car and the battery pack separately as long as KWH prices are relatively high and lifespan is limited. Of course once battery technology is available that last 2000+ cycles (it's already claimed for LiFePo4, but it has low energy density) a 40KWH battery pack would last 400.000 miles so the battery will outlast the vehicle anyway.
     
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  3. By jeffhre Posted: 3/15/2010 9:14am PDT

    How much will you give me for my 1990 hatchback with no motor?
     
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  4. By Dadio Bob Posted: 3/15/2010 11:11am PDT

    I'm looking at the upcoming Tesla S sedan and I think there will still be plenty of value left when the original battery is depleted. Newer batteries should be available by then with longer life and cheaper cost. Swap out the old battery for a new and improved battery and you still have a great car! Plus there might be a little recycle value left in the battery, who knows.
     
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  5. By Noel Park Posted: 3/15/2010 12:29pm PDT

    We drive our cars until there is nothing left of them, so residual value is not something we worry about at the time of purchase. Also, we only buy cars which have a high emotional appeal, or a really cheap, utilitarian, purpose. So either way, we don't care.
    I can't see any reason to believe that these "experts" can make any better of a guess than any of the rest of us. Same comments as to the "Too Many Lithium Batteries" thread. Consultant = con-man + insult.
     
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  6. By Paul Posted: 3/15/2010 2:43pm PDT

    The title of this post is brainless.
    The powertrain parts in an EV are rated at between 20,000 (motor) to 100,000 hours, typical of ALL electronics. Just do some minor maths and you'll realize those parts will EASILY outlive the owner of the vehicle.
    So the question is simply some prediction of where battery technology will be in 10-15 years..... I DARE you to make a prediction of battery prices in 2 years, let alone 15!
     
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  7. By eric E Posted: 3/15/2010 8:12pm PDT

    There is a whole new market...
    Retrofit, Lion battery packs for older EV's. All smart mechanics will be doing it.
    "Can I get a 15kwh upgrade for my 2011 Volt please"
    "Oh. And I'd like the quick charge option too."
     
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  8. By Isaac Posted: 3/16/2010 12:49am PDT

    So you're telling me that the battery technology will remain the same during those 10 years? I'm sure that $10,000 battery you bought in 2010 will be more affordable in 2020?
    I wonder if cars will soon become like computers where you can upgrade components such as the battery.
     
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  9. By aaron Posted: 3/16/2010 1:42am PDT

    The title of this article is utterly nonsensical. No car lasts forever, but the question implies that conventional ICE cars can run forever, which is obviously NOT the case. At some point in a vehicle's life cycle, it is going to stop running, whether it is an EV or a conventional ICE vehicle. So the same logic applies. When the gasoline engine in my Nissan pick-up stops running, I'm pretty sure its going to be just about worthless...duh.
     
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  10. By aaron Posted: 3/16/2010 1:46am PDT

    The premise of this article is utterly nonsensical. No car lasts forever, but the question implies conventional ICE cars can run forever while EV vehicles on the other hand have a finite lifespan, which is an utterly laughable. At some point in a vehicle's life cycle, it is going to stop running, whether it is an EV or a conventional ICE vehicle. So the same logic applies. When the gasoline engine in my Nissan pick-up stops running, I'm pretty sure its going to be just about worthless...duh.... btw, how much did Exxon/Chevron pay you guys to print this article?? I thought this was supposed to be a pro-EV website??
     
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  11. By JC Jacquemin Posted: 3/16/2010 2:22am PDT

    Welle pointless with an economic model like the Betterplace one;
    That is why I'll buy my second EV with a swappable battery.
    Best regards,
    JC NPNS
     
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  12. By Tommy Posted: 3/17/2010 11:17am PDT

    A good comparison would be that of the toy Radio-Controlled electric cars and trucks. Resale value in those items remain relatively high due to the low cost of replacement batteries. Tesla Roadster costs $100K+, the battery pack is about $25K, what would you pay for a used Roadster + New battery pack? The brushless motors don't wear out like old brush motors, they will last a lot longer. Electric cars have far fewer wear and tear parts compared to an ICE car.
     
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  13. By Randy Steer Posted: 3/17/2010 12:18pm PDT

    To begin with, CAP are obviously idiots for releasing a press release about the topic before they have done their study or can answer any questions. Traditional market-research approaches (often based on what people SAY) are pretty much useless when a product category is so new that there is no established market and buyers don't understand the product. Commercial BEVs are a good example: CAP say they have data showing zero value after the battery warranty -- that's because there are few companies currently interested in BEVs and the vehicles seem unfamiliar and scary to purchase. But commercial users are exactly the ones who will be very rational about the economics: If the chassis, body, and drive-train will last through three or four battery packs, replacing the battery makes it much cheaper than buying a new BEV. Large commercial trucks routinely have their engines replaced or completely rebuilt during their lifetimes -- the TRUCK itself has value even if a commodity part needs to be replaced.
    The other part of the puzzle not addressed by previous comments is that batteries will be FINANCED one way or another -- when you can get a car loan that covers the cost of a used EV plus a new battery, the EV will have plenty of residual value.
     
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