Renault Concerned Over Lagging EV Residual Values

1 week ago by Mark Kane 20

Renault lineup – from left Twizy, ZOE, Kangoo Z.E., Master Z.E.

The residual value of electric cars is popular topic, and now becomes a hot one in Spain, where Renault dealers are gearing up for the upcoming end of leases.

Renault ZOE

As it turns out in Europe, lease-end residual values are lower than originally expected when set a few years ago, and someone will need to take a loss.

Ivan Segal, commercial general manager atRenault Spain, raised the EV residual value proposition at the Barcelona auto show, urging the establishment of a scale of residual values for used EVs.

““Nowadays, when a motorist wants to change his EV for a new one – although this does not necessarily mean another EV – the first thing that the dealer has to do is look for a buyer for the old EV, and that greatly slows down the sale of the new vehicle,” Segal says without citing specific monetary or sales figures.

Some of the EVs being returned to dealers could be remarketed under car-sharing schemes, Segal says. “Some competitors have entered in this market but until now they have only got profits regarding image, not money,” he observes.”

source: WardsAuto

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20 responses to "Renault Concerned Over Lagging EV Residual Values"

  1. cab says:

    Double-edged sword in these early days of EV sales. Buyers have gotten spoiled with super cheap lease deals which they now expect to continue (but can’t). The super cheap lease deals were made possible by generally inflated residuals, and with the tech changing so rapidly no one (including the original leasee) wants a used EV unless it is dirt cheap. So, either leases adjust to this new normal (and sales tank), or manufacturers eat the losses over the next decade. Is it any wonder manufacturers aren’t jumping in with both feet?

  2. Mikael says:

    How about they offer better cars with larger batteries?

    A 60+ kWh Kadjar, Captur or Megane (Sport Tourer) GT would most definitely hold up resale value better than an overpriced, low range compact car.

  3. Some Guy says:

    The argument that a cheap used EV slowes down sales of new EVs is not entirely true. There are many out there that can’t afford a new EV in Europe, and perhaps would be happy to trade in their 10+ year old ICE (that they bought second hand at 8+years of vehicle age). I also bet they could export the used ones to the Ukraine or Eastern Europe in bulk (like any other used car).

  4. sveno says:

    Heres a “novel” idea: provide upgrade battery packs to old models. How about buying a 3 year old EV with a new (or refurbished) pack with higher capacity cells?

    1. unlucky says:

      No thanks. Not interested. The cars are getting better. The infotainment is getting better. And charge rates for AC and DC keep going up.

      1. Will Davis says:

        Not everyone cares about the infotainment. Most of it can be done as a software update anyway. Most folk would rather the vehicle be affordable, even if it means having slightly older tech.

      2. Djoni says:

        I disagree with you Unluck!
        I, for one among many, would rather pay, a few thousand dollars to refurbish my Leaf to better than new range.
        Let say I put 6 or 7K$ and I suddenly have a 130 miles range car instead of about 60 right now.
        That would be a lot cheaper than buying a brand new, whatever brand, 200 miles car.
        And a lot more ecological, since all the other part of the car can keep servicing another 5- 6 years or more.
        The infotainment was DOA when I bought it anyway, and I just use Android for mapping.
        It is the same in any newer car; the auto manufacturer just can’t keep up with the IT guy, Apple, Samsung or other.

    2. Paul K says:

      Sorry unlucky I’m with Seveno on this one. I own a 30kwh Leaf (great car!) and often refer to the first generation electrics as the Commodore 64s of the electric car world. Making upgrade batteries available for 1st generation vehicles would help residual values. And residual values are something prospective new purchasers will look at. Listening Nissan?

      1. SJC says:

        Subsidies distort markets, all the profit was made up front good luck with the rest. California could provide tax free sales for used EVs. This would provide an incentive that does not cost the state much.

    3. notting says:

      I thought the 22->41kWh Zoe upgrade is already offered?

      notting

    4. AlexR says:

      Great idea, I would be interested.

  5. KM says:

    This is probably the only time that Zoe’s battery capacity almost doubled with the refresh. In the future it will probably grow by about 20% every couple of years so the depreciation will not be as bad.

  6. Murrysville EV says:

    “As it turns out in Europe, lease-end residual values are lower than originally expected when set a few years ago, and someone will need to take a loss.”

    No kidding, that’s true in the US also. That’s why I leased, and that’s why I didn’t buy at the end of the lease. Nissan is taking a bath on Leaf 1.0s coming off lease.

    It’s all related to battery degradation, which is why a Tesla has better resale.

    1. sveno says:

      Around here leasing is expensive for Leaf precisely because of low residual values. So they already anticipated it being a cutting-edge&rapidly aging technology in the automotive sector.

      I happen to think a used Leaf, the one with improved chemistry pack, is a bargain and thus a great second car.

  7. Benedictus says:

    I think the issue is the battery rental sceme that accompanies the Zoe. The monthly rent is an unwanted construction for a used car.

    1. Nero says:

      Not really, if you lease gen1 Zoe, you can replace 22kwh battery to 41kwh by request and still use the same vehicle with better (way better) capacity and way longer range

  8. Ron says:

    I am glad to hear that Renault is suffering the same problem as the early adopters who purchased Nissan Leaves in USA. Better support from Nissan/Renault would improve residual value.
    I paid $30K and 4 years/50,000 miles later was offered $5K. Depreciation was 50c/mile.

  9. cab says:

    The Tesla Model S’ “cool factor” and perhaps “big battery” does seem to shield it from the typical EV depreciation rate tumble, but its not really any better than an equivalent luxury car.
    I just did a 5 year cost to own calculation (on kbb) on a Mercedes S class ($126K) and the depreciation curve at year 3 is nearly identical to what I picked up a 3 year old Model S for (e.g. about 50% of a new one). As an aside, it’s value continues to plummet and I’ll lose way more in “real dollars” than I would have with a cheaper car.

    1. Martin Winlow says:

      Wow. You got a good deal there, then, Here in the UK my 2 year old S60 is still worth a good 80%+ of what I paid for it new. Was yours a highly specced version?

      1. cab says:

        Yes and, of course, those options depreciate even more rapidly. It was also somewhat higher miles at 45K miles (not an issue for me as I put less than 600 miles a month on it)

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