We all want a good value when buying a used car. Who doesn’t love picking up a five-year-old low-mileage car for 60 percent less than what the car cost new?
Getting a great used car deal is the holy grail of car shopping for many value-oriented shoppers. My best experience was scoring an almost half-price deal on a used car that had been sitting on a dealer’s lot for a long time. It was a base model and had a 5-speed manual. No one wanted the car, the dealer wanted it gone, and I made a half-price offer, which was accepted.
That was a little over five years ago. Today’s best bargains are a little different. In fact, they’re electric.
Car and Driver said,
Electric cars are more efficient than gasoline or diesel vehicles, and they save serious money—a few hundred to a few thousand dollars a year, depending on the vehicle type—using electricity from the grid versus fuel from the gas station. They cost less to maintain and repair, too. But all that money saved—even including the $7500 federal EV tax credit that will sweeten your first year—won’t counter the worst thing to befall most EVs: horrendous depreciation.
Just how horrendous? The article said that non-luxury electric vehicles depreciate an average of $5,700 per year over the first five years. Do the math, carry the one…. That’s an absurd $28,500 off the original price. Industry average is about $3,200 per year over five years.
Let’s take the Nissan Leaf as an example. A 2017 Leaf SL carries an MSRP of about $37,000. Five years later, an owner can expect to sell it for just $8,500. That massive depreciation holds true in current car listings, with some 2012 Leafs listed for under eight grand.
The trade-off for getting a cheap used electric car is owning new technology that’s out of warranty. That means there will be no help from the automaker in the fairly unlikely event that the battery pack fails or loses significant capacity.
While finding late-model electric cars for under 10 grand is possible, it might be a better option to consider leasing new or buying a certified pre-owned car that’s still under warranty. With a five-year-old gas-powered car, buyers still get reliable technology that hasn’t changed all that much. Technology is changing so fast in the world of EVs, though, that buying used could mean buying obsolete.
For buyers who want the ultimate in affordability, though, a used EV can mean a low purchase price and the end of expensive fuel costs.
When you go electric, will you buy new, lease new, or buy used?
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