EV/Hybrids have a poor resale market.
So it's that time again when we learn about which markets can hold their value and those who can't. And again it seems that luxury sedans and the EV/Hybrid market are the losers of the automotive world while trucks and actual SUV's are holding their value well. Now why would a gas pig truck hold a better value than a luxury sedan or EV/Hybrid. Well for starters, the luxury sedan marketplace is saturated beyond belief, as every company has their own luxury or premium brands fighting for that high end markup over their standard siblings. Well that makes a bit more sense to the world, but why does the EV/Hybrid market have a poor market value? Now that is what we are going to explain to you.
If you haven't noticed by now the EV/Hybrid market is gaining momentum after a lengthy battle with their petrol counterparts. It seems that this segment is finally gaining steam on their hydrocarbon siblings and making in roads into their market share. But why would it seem that they can't hold their value when it comes to the resale marketplace. Well that is a question for the used car market as a whole.
Say you take a look back to when the very first Prius rolled off the line and we see how many they made. Well not a lot as the first generation didn't do all that well, but it did help make the world aware that their was an alternative to their hydrocarbon sibling the Corolla. But why again did this car sell for far less than the same year Corolla does. That question can be answered with one simple world....."Technology". And as the technology was new to the world, it was also more expensive on the repair bill than its Corolla sibling. But again you may ask as how does a Cadillac still command decent rates when it has new and unused technology that it's Chevrolet sibling doesn't have. Well again that answer is in the finer details about the cost of repairing the vehicle.
Only a couple of years ago we got to find out how much it was going to be to replace the battery pack on a Tesla Roadster and second generation Prius. And to no surprise the costs were similar to the purchase of a new petrol model of similar size and features. This helps keep people away from the second hand market and when they do wander into this marketplace they are ready to offer lower amounts as they all know that they will soon have to dish out a large sum of money to repair that vehicle. No one really wants to pay $65,000 for a Tesla Roadster and find out they have to dish out another $32,000 for a new battery pack. For most of us, we would rather just purchase a brand new Mustang or Corvette and still have money left over. Sure unlike those cars the Tesla will have less overall expenses over the next 8 - 10 years of life, but really most of us are still petty cheapskates.
As for the Prius and Leaf owners out there, the same could be said about your battery packs as most dealers charge between $6,000 - $8,000 for a full replacement of the battery pack. But unlike their EV cousins the hybrid still comes with the same inherit issues that plague our petrol siblings. As a standard Hybrid still comes with a petrol backup power source which will again lead to even more costs then their plain jane petrol siblings. So again we have to say that our $5,000 quick fix Civic is still cheaper over the next 100,000kms than my used Prius or Leaf would have been.
So as it comes down to plain dollars and cents, it seems that the lower value for the resale market on EV's and Hybrid's is pretty self explanatory. I hope we helped paint a better picture for the market and just remember that as more and more companies start pushing this technology, then the price for repairs and replacements will come down. This will help move the resale market up in value for this market, but until the costs between petrol and EV/Hybrids comes in line with each other, then you can expect to hold onto your Model S or Leaf a bit longer as you won't be making you money back on it.
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