Electric Cars Take Another Financial Hit
As time passes, I’m finding fewer reasons to buy an electric car.
While EVs are slowly gaining popularity, a nationwide charging infrastructure is barely in its infancy. That’s strike one against electrics. Even so, electric cars are proving themselves as commuters while saving owners a bundle on gas costs. Things should be looking up for this new chapter in automotive history.
There’s a problem, though. For the first owners of a new electric car, the finances just don’t add up. And it’s getting worse.
Buying a new EV costs thousands more than a comparable gas-powered car. That’s certainly not new information. Now, though, comes the news that owners are getting fleeced on the resale end of the deal too.
For example, a new Chevy Spark EV may retail for over $27,000. The base Spark costs just over $12,000. There’s strike two.
In 5 years, estimates are the Spark EV will be worth only about $8,000, which is less than what its gas-powered counterparts might fetch. Additionally, the Ford Focus EV is expected to be worth only 20 percent of its original value when compared to the top-of-the-line gas model, which is anticipated to keep around 36 percent of its original MSRP.
However, this may not have an immediate impact on the EV market, because significant government subsidies for buying these cars are still in effect. Plus, many EVs are leased for low monthly payments, and customers just don’t care what the car is worth at the end of the lease.
For buyers of used electrics, this is the best news ever. Of course, cheap used EVs come with a catch: the lifespan and reliability of battery packs. How much juice do they still pack after 5 years, and is it worth the risk of a possible battery replacement?
Would you buy a 5-year-old electric vehicle?