5 Things That Could Affect Your EV’s Resale Value
If you’re thinking of buying an electric vehicle that you plan on selling after a few years, there are a few things you should know about that could affect its resale value. The metrics for evaluating an EV are a little bit different compared to a gasoline vehicle, and you need to be aware of them so that your vehicle retains as much value as possible.
The question is: how will your electric vehicle’s residual value be judged when you want to sell it? Well, let’s find out!
1. Market Demand
Of course, if there is a higher demand for used electric vehicles, you’re more likely to get a higher resale value. For instance,the global chip shortageincreased the price of used electric vehicles by 54% because manufacturers couldn’t make enough new ones to meet market demand.
Your vehicle’s brand is also important when determining its used value. According to a study byEnergy Sage, if you own a Tesla, you’re more likely to sell it for a higher price compared to vehicles from other brands. This is because Tesla is the most popular electric vehicle brand in the United States, with the largest market share and unmatched brand awareness.
In fact,Teslasays you could sell your pre-owned model at a guaranteed resale value of no less than 50% after three years. But it’s not just Tesla vehicles that have a low depreciation value; other brands like Chevrolet and Audi also have sought-after EVs with high resale values, as per data published byCarEdge.
2. Battery Condition
The condition and remaining lifespan of your EV’s battery will affect the resale value of your electric vehicle. This is because EV batteries are expensive to replace, and they can cost almost half the value of your vehicle. For example, between $20,000 and $35,000 iswhat it will cost you to replace a Tesla battery pack.
Thankfully, most EV batteries are of the lithium-ion variety and should last between 300,000 and 500,000 miles. Not to mention, the US government requires all manufacturers to have a minimum battery warranty of no less than eight years. Most manufacturers will also replace your battery if it doesn’t hold up to 70% of its original capacity within eight years.
However, your electric vehicle will still depreciate depending on the mileage you’ve covered with the battery. Potential buyers could also check how fast the battery charges to know its condition. If you’re selling your EV during the winter, you should keep in mind thatyour car’s battery will drain faster and charge slower when exposed to freezing temperatures, which may negatively impact the car’s value.
DC fast-charging your EV is also known to have a negative impact on the battery pack’s longevity and how much charge it’s able to hold after years of use. EVs that have frequently used a rapid charger will have visibly less capacity compared to ones that were only slow-charged.
3. Eligibility for Tax Credit
Afterchanges were made to the federal tax creditin January 2023, popular EV models in the United States no longer qualified for the incentive. In response to that,Tesla slashed its pricesby up to $13,000 to make more versions of its EVs qualify for the federal tax credit and drive up demand in major markets. Ford followed Tesla’s lead by reducing the price of the Mustang Mach-E by up to $5,900.
This means that if you bought a Tesla or a Mustang Mach-E in 2022, its residual value has decreased proportionally to its price cut. Similarly, if you bought your EV a few months before the tax credit took effect in 2023, it is likely to lose more residual value compared to an EV that qualified for the tax credit.
On the other hand, if you’re selling your used EV for less than $25,000, you may find it easier to find a buyer for it. This is because potential buyers could get a tax credit of up to $4,000 if they’re buying used EVs that cost under $25,000. Some of the most popular second-hand cars that can qualify for the used EV credit include the Nissan Leaf, the 2017 Kia Soul EV, the Volkswagen e-Golf, and the Ford Focus Electric.
4. Presence of Driver Assistance Technology
Used electric vehicles that feature advanced technology could have a higher resale value compared to models that don’t. If you own an EV with self-driving technology or advanced safety systems, you’re more likely to sell it at a higher residual value than the same EV model without this feature. Tesla is considered an autonomous driving leader but other manufacturers that sell EVs, like Ford, Lucid Motors, Rivian, and Polestar, are catching up.
EVs capable of bidirectional charging, like the Ford F150 Lightning, are also available, and this is a feature that should increase their value come resale time. They allow you to use your electric vehicle’s battery as a backup option to power your home during an electrical grid failure or even charge another EV. Other electric models, like the Hyundai Ioniq 5, the Kia EV6, and the Rivian R1T, come with AC power outlets to connect directly to your home devices or for use when camping.
5. Maintenance History
Electric vehicles are cheaper to maintain than gas-powered cars because they don’t have an engine. However, you still need to maintain your EV according to the owner’s manual. This entails servicing your cabin air filter, brake fluid, A/C desiccant bag, and HEPA filter as required by the manufacturer.
Once you’ve covered over 150,000 miles, you may need to replace the transmission and differential fluid as well as battery coolant, depending on your EV model. Of course, the residual value of your used EV will be calculated based on your maintenance history, and if you missed any important servicing schedules, you could get a lower offer.
In addition to that, your used EV could lose a high percentage of its value if it’s ever been involved in an accident that affected its structural integrity or the battery pack.
The Used EV Market Is Difficult to Predict
If you’re selling your used electric vehicle, its residual value will be directly impacted by its market demand, battery condition, tax credit eligibility, presence of advanced driving features, and maintenance history. Other external factors, like the global chip shortage, have also affected the resale value of electric vehicles, driving their price up.
Nevertheless, the used EV market is still in its infant stage. It’s therefore difficult to accurately predict what the value of used electric vehicles will be. What we know is that a lot more EVs will be launched over the next decade, thanks to constantly increasing sales, and this will surely drive up demand for both new and used vehicles.
They look great, have fantastic acceleration, and cut down on your gas costs. What’s not to love?
Turn these settings on, and your iPhone will be so much better than before.
Anyone with more than a passing interest in motorsports must see these films.
Freeing up vital memory on Windows only takes a moment, and your computer will feel much faster once you’re done.
Your iPhone forgets what you copy, but this shortcut makes it remember everything.
My foolproof plan is to use Windows 10 until 2030, with the latest security updates.
