Low energy costs plus lower maintenance and repairs, what’s not to love about electric cars? Oh yes, that’s right, the resale value on them is shocking! Before you go trading your electric car for the next one that’s tickled your fancy, you might want to learn more about just how much they depreciate in value first.
Electric cars don’t hold their value
Electric cars have been on the rise these past few years and have become increasingly popular, it's just such a shame that the same thing can’t be said when it comes to holding their value.
Of course, the depreciation of the car depends on the mileage, condition, and brand and if you’ve got a higher premium car then you might quite lucky as these normally tend to hold their value a little longer than your standard models.
It hurts us to say it but when you buy an electric car, it’s not long before its value begins to depreciate. This is mainly due to their popularity these days. With their batteries having improved and the demand on the rise, their value has taken the wrap for this.
Models from Tesla and Mercedes, your more high-end premium brands, tend to retain around 65% - 60% of their value after around three years or 36,000 miles. This sounds pretty good, right? This is because you’ve got your luxury high-end engines and ultra-low emissions, combined with your rising congestion and fuel prices all playing their part.
If you look at the lower end of the scale, with the likes of Nissan, Toyota, and Smart cars, these are the ones that tend to depreciate that bit quicker, mainly because these are more affordable and use cheaper parts, which tend to wear down more quickly and therefore impacts the value.
How much do electric cars depreciate each year?
Now, this is a great question. Typically, in the UK, electric cars tend to depreciate between 15% and 35% each year in the first year.
They reckon that based on around 10,000 miles per year, your average electric car loses around 60% of its value after three years. In theory, this means that if you had a car bought for around £20,000, it would only be worth around £8,000 after three years. Depending on how long you want to keep the car for too, let’s say for around three years as an example, then you’re looking at spending around £4,000 a year on depreciation. We could carry on but these numbers are only going to get more frightening.
Of course, there are other things that come into play too, like the condition and desirability, but its no doubt that most of us want to avoid high depreciation.
How does this compare to normal cars?
When we say normal cars we mean your petrol, diesel, and hybrids, etc. Now compared to these, your standard electric cars stack up pretty well. Petrol cars tend to depreciate the fastest more than anything else and diesel isn’t much better either.
It’s not news to us anymore either that there is a limit on your good old internal combustion cars now, especially with the ban on the sale of new petrol and diesel models coming in 2035. With car buyers becoming more and more aware these days of the benefits that electric cars have on the environment compared to your petrol and diesel cars, the focus is moving towards electric cars and their depreciation value.
Your hybrids are still going strong though and have a pretty good resale value at the minute, which is great as they're much healthier for your urban environments. Thanks to the availability of energy tariffs too, with cheap prices, this is also helping electric cars too.
Thinking of selling your car and getting an electric that holds more value? We can help you get rid of your current car and get the cash that you need to put towards an electric one. Simply enter your reg number and accept the offer that suits you. It's as simple as that.