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Second Hand Market discussion

Greg Hook

Moderator & Reviewer
Just changed my car and couldn't quite afford the electric car I wanted, so will possibly get that next time round on lease.

But had an interesting conversation with the dealer about second hand values of electric cars.

Given that most of the cars have warranties on batteries, a car that is say 7 years old where the battery is out of warranty, what will that do to the second hand value of it?
If the car is worth £8000 but the batteries are now out of warranty and could cost £5000+ to replace, how are you even going to sell it?

In the future I can see second hand car sales people having real issues trying to sell second hand electric cars.
 

stblob

Well-known Member
Yep. Look at the early Nissan leaf's. High price and limited range. How much??. Yea right.
 

IronGiant

Moderator
If the car is worth £8000 but the batteries are now out of warranty and could cost £5000+ to replace, how are you even going to sell it?
Similar applies to a 7 year old ICE car where the cost of a new engine is probably more than the car is worth. But of course with EVs it's uncharted territory, there simply aren't enough 7 year vehicles around to tell how the 2nd hand market will perform. A bigger issue maybe the ever increasing capacity of new models and/or new technology(s).
 

494930

Distinguished Member
It's not really any different to second hand ice cars. A replacement engine can be upwards of £15k on some models but they still hold their value.
 

Greg Hook

Moderator & Reviewer
Yes, I see the point on ICE replacement engines.
Battery packs have a short finite life. Engines if cared for can last for a very long time.

But as the old fella above said, it's uncharted territory at the moment. Only time will tell how long batteries last and what the second hand value will be.
 

LV426

Administrator
Staff member
Working on the assumption that an EV battery is useless enough to need replacing at 7 years. Let's be clear - that is just an assumption. If it's based on typical offered warranties - I can't believe that manufacturers will offer warranties that are likely to equate to the lifespan of the component; rather, I think it far more likely there is a substantial margin there - that 7 or 8 years is well below the probability of substantive failure.

According to this (and I can't vouch for the validity)


The bottom line here is that if it’s properly cared for, an electric car’s battery pack should last for well in excess of 100,000 miles before its range becomes restricted. Consumer Reports estimates the average EV battery pack’s lifespan to be at around 200,000 miles, which is nearly 17 years of use if driven 12,000 miles per year.

During the 12 years I had my old diesel, the engine proper never needed anything and when I sold it, there was little in the way of visible exhaust when it was started from cold, even after a few days. So I guess it was in good order. I never had to replace the exhaust system.

BUT: It had two new turbochargers under warranty and I believe the intercooler was also replaced. It had another Turbo out of warranty (~£1000 fitted IIRC); a new fuel pump (~£600 IIRC). And then there were more routine replaceables - notably brake pads and discs; bear in mind that wear on these in an EV is a fraction of that in an ICE because most braking in an EV does not use the friction brakes at all. Plus oils etc. And aside from routine replacements, the belt that drove the alternator failed in use and left me needing recovery. There are no equivalent components in a EV. etc. etc.

Although it wasn't a material factor in my case, ageing ICEs may very well need clutches and/or other major mechanicals that simply aren't there in an EV. Each costing less than an EV battery, of course - but together over the life of the vehicle??

In any case, as you say, the market will sort itself out once real experiences are sufficient to steer it. In the much shorter term, my own EV went from £24800 new for cash to £20k trade-in (£22k on the forecourt) in the two years/18500 miles I had it.

My guess is that there will be a bigger effect on used values when (or if) some new technology comes along that offers better charge density and/or recharging speeds or nuclear fusion or whatever that makes present tech outdated. And I firmly believe it wil.......
 

neilball

Well-known Member
Yes, I see the point on ICE replacement engines.
Battery packs have a short finite life. Engines if cared for can last for a very long time.

But as the old fella above said, it's uncharted territory at the moment. Only time will tell how long batteries last and what the second hand value will be.
Battery packs are not the issue, and evidence so far shows they will generally last much longer than original estimates (see the taxi fleets that showed no substantial difference in degradation having been rapid charged several times a day and retired after 150,000 miles, compared to low mileage EVs of the same age). It’s the high cost items such as inverters and chargers, or the various electronic controllers that are likely to be the prohibitively expensive repairs to an old EV.

Battery packs can already be stripped down and dud cells replaced for modest sums compared to replacing an entire pack, and even a “duff” battery pack has a substantial value. So if/when EVs are sold for “scrap” they are still worth a few thousand if the battery is included.
 

Delvey

Distinguished Member
Similar applies to a 7 year old ICE car where the cost of a new engine is probably more than the car is worth. But of course with EVs it's uncharted territory, there simply aren't enough 7 year vehicles around to tell how the 2nd hand market will perform. A bigger issue maybe the ever increasing capacity of new models and/or new technology(s).
But when will an engine itself fail?
If maintained properly, a decent VAG Japanese or Volvo can do 300,000 miles. Yes, turbo might fail, but chances are it will be something else making the car not economical to repair. And how will the battery of a 10 year old vehicle take you?
 

Delvey

Distinguished Member
I can't believe that manufacturers will offer warranties that are likely to equate to the lifespan of the component; rather, I think it far more likely there is a substantial margin there - that 7 or 8 years is well below the probability of substantive failure.
Car manufacturers will wriggle out of any warranty claims. I had a citroen with an automatic gearbox which doesn't need maintaining as it is "sealed for life"
The gearbox failed after 100,000 miles, in this day and age that is well short of the typical life of a car.

Or a friends Toyota work van, at 6 months old with the engine seized, are refusing to pay for the repairs, as they claim it ran out of oil, even though they supposedly fixed an oil leak 4 weeks before
 

gangzoom

Well-known Member
In the future I can see second hand car sales people having real issues trying to sell second hand electric cars.
The first Nissan Leafs were released in 2011 and the Tesla Roadster in 2009, so these cars are now coming up to a decade old.

The cheapest Nissan Leaf is just under £6.5k, which for a 8/9 year old small mass produced Nissan Hatchback is pretty expensive, a Nissan Note of the same age is £1.5k.

The Tesla Roadster is now Appreciating, 2 years ago you could get one for £40k, now they are around £60-70k.

What people forget when trying to 'predict' EV prices is for every brand new EV sold today there are about 95 non EVs been sold at the same time.

Regardless of what you thoughts are on battery life/tech, no one can seriously think a brand new diesel car today will be more relevant in 2030 compared to an EV today with the way citites are bringing in clean air zones.
 
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gangzoom

Well-known Member
Yep. Look at the early Nissan leaf's. High price and limited range. How much??. Yea right.
Great example, an early Nissan Leaf has now pretty much stopped deprecating!!

As have early Tesla Model Ss.

These cars have running costs of sub 10p per mile including fuel/tyres/servicing. Compared to a combustion car of similar age they are much mote attractive as a used buy, hence they are really holding their prices.

Newer EVs with more range will do even better on the residual front.
 

Delvey

Distinguished Member
The first Nissan Leafs were released in 2011 and the Tesla Roadster in 2009, so these cars are now coming up to a decade old.

The cheapest Nissan Leaf is just under £6.5k, which for a 8/9 year old small mass produced Nissan Hatchback is pretty expensive, a Nissan Note of the same age is £1.5k.

The Tesla Roadster is now Appreciating, 2 years ago you could get one for £40k, now they are around £60-70k.

What people forget when trying to 'predict' EV prices is for every brand new EV sold today there are about 95 non EVs been sold at the same time.

Regardless of what you thoughts are on battery life/tech, no one can seriously think a brand new diesel car today will be more relevant in 2030 compared to an EV today with the way citites are bringing in clean air zones.
But you could pick up a 4 year old car for £6.5k
Something probably more comfortable, more features (and from my perspective) better looking than near decade old Leaf
 

PRESSTOG

Well-known Member
Also have to remember that the warranty of 7 years 150k miles or whatever is normally that the battery will not fall below 70% or 75% (Depending on manufacturer), of its initial capacity. Not that it is stone cold dead and will not work anymore.

So if you have a car that does 300 miles on a charge, even if it does lose 30% or so of its capacity over 150k or 200k miles then it still has a useful range of 200 or so miles.

Say it loses another 30% over the next 150k or 200k miles, and the useful range drops to 100miles. the car will have covered 300k to 400k miles and be ready to be scrapped

But those battery cells will still have use as home storage or remote power storage for manybe another 10 or so years.

The amount of batteries that fail stone cold with a catastrophic failure will be tiny, its this general degradation which makes it easy to forward plan values.
 

djcla

Distinguished Member
Have to say one of the things that put me off EV's is the depreciation not due to reliability although that is a slight concern as i can imaging getting them fixed being a right pain. More that i see them like any tech which is very quickly outdated . in 5 years my guess is the range will be 400+ and charging will taken 20 minutes so those old 80 mile range cars are not going to be very desirable.
 

IronGiant

Moderator
If you only do 120 miles a week, why pay 50K for a car that can do 400 on a single charge, if you can pick up one for < 10K that does everything you need with maybe one or two overnight charges a week at home?. As the market for new runaround town ICE cars dries up, ie you can't buy a new one, I can see these lower range EVs appealing to a different market.
 
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djcla

Distinguished Member
If you only do 120 miles a week, why pay 50K for a car that can do 400 on a single charge, if you can pick up one for < 10K that does everything you need with maybe one or two overnight charges a week at home?. As the market for new runaround town ICE cars dries up, ie you can't buy a new one, I can see these lower range EVs appealing to a different market.
Good points and i guess we shall see but would you not choose a super efficient petrol runaround instead .

I keep meaning to work out how much you would actually save in an EV verses a petrol car that can do say 55/60mpg on average.
 

LV426

Administrator
Staff member
I keep meaning to work out how much you would actually save in an EV verses a petrol car that can do say 55/60mpg on average.
AA says November unleaded average = 126.6ppl = £5.76/gallon
At 60mpg that's 9.6p/mile.

My EV averages about 4.5 miles per kWh
Domestic power costs just under 16ppu where I live.
That's about 3.5p/mile.

Unlike fossil fuel, though, it is possible (at the moment at least) to get totally free "fuel" for an EV which, if you are up for it, gets the running cost down further still. Many Tesco stores will give you a free charge, for example, as do many malls and the like. (Charge while you do something else - work, lunch, shop, etc.) Mine is currently calculated at just under 2p/mile average accounting for domestic charges, parking charges where unavoidable to obtain a charge, etc.

Conversely, if you find yourself having to use roadside rapids, at 30/35ppu, they can be relatively costly.
 

IronGiant

Moderator
Good points and i guess we shall see but would you not choose a super efficient petrol runaround instead .
I was looking a bit further forward, when the manufacturers start ramping down production of ICE's and the government potentially starts boosting it's revenue on reducing fuel sales by increasing tax on it to discourage their use.
 

djcla

Distinguished Member
I was looking a bit further forward, when the manufacturers start ramping down production of ICE's and the government potentially starts boosting it's revenue on reducing fuel sales by increasing tax on it to discourage their use.
I actually think they will start taxing EV's by then as well.
 

gangzoom

Well-known Member
If you only do 120 miles a week, why pay 50K for a car that can do 400 on a single charge if you can pick up one for < 10K that does everything you need with maybe one or two overnight charges a week at home?
Exactly why I don't think used EV prices will fall much.

Who doesn't want more range, more speed, more toys, but equally unless you have money to burn everything is a balance.

A £30k+ new EV will have more range than a £10k used Leaf, but if you are never going to use that range its £20k wasted.

The cheap running costs of EVs really make them long terms keeper, and hence reflected in not that many forsale and good used prices.

When I look at our ownership costs over 3 years and 45k, one set of tyres at £450, £0 VED, £0 in servicing, £80 in air filteres which was a DIY job, and fuel costs of 3p per mile.

You than look at the cost to change if you want the latest toys/more range. Our car was very expensive to buy but has very good residuals with about 30% depreciation at 3 years. However the total cost difference to swap to a new one is around £40-45k as the latest car with more range is around £20k MORE expensive to buy, and given we have done close to 45k mile in 3 years more range really isn't needed.

So when I look at the cost of ownership versus cost to swap to a newer EV more range, the logic of paying a crazy ££££ for a newer car with more range is virtually nonexistent, hence our EV may well end up been a car thats kept in the family for a long long time!!
 

gangzoom

Well-known Member
I actually think they will start taxing EV's by then as well.
Almost certainly but the DVLA has hardly ever applied 'retrospective' taxes, hence some really old cars don't even need a MOT.

The time to get on the EV bandwagon is now, whilst incentives still apply, not later when everyone wants one.
 

Bl4ckGryph0n

Distinguished Member
Almost certainly but the DVLA has hardly ever applied 'retrospective' taxes, hence some really old cars don't even need a MOT.

The time to get on the EV bandwagon is now, whilst incentives still apply, not later when everyone wants one.
Agree from a timing perspective. The benefits are still there.

When you look at the Netherlands the Government is starting to increase the taxes already quite considerably. Albeit to be fair they are still less than ice. And as I’m looking for property in central Amsterdam I can’t buy a parking place unless I’ve got a zero emissions vehicle 😬
 

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