As New Vehicle Prices Rise by 1.1%, Plug-In Vehicle Prices Fall by 15% Over Past 12 Months


Plug In Vehicle Prices Continue to Drop

Plug In Vehicle Prices Continue to Drop


Though some may view the following as a negative, potential future buyers or plug-in vehicles should immediately realize that there’s a HUGE positive here.

In reporting on the prices that new vehicle buyers paid in November, the Wall Street Journal says this:

“The average new-car transaction price in the U.S. increased 1.1% or $352 to $32,769 in November compared with a year earlier. Prices rose an average of and rose 3% or $946 from the previous month, according to auto industry research company Kelley Blue Book.”

Later on in the article, the Wall Street Journal adds in this:

“While cars many vehicles are getting more expensive, some cost less now than they did a year ago. The average transaction price in the small-but-growing electric car category fell by 15% largely because of a series of price cuts during the past year.”

WSJ says that rising pricing for ICE vehicles are mainly due to high demand.  Must we then assume plug-in vehicle prices are falling due to low demand?  No…perhaps lower than expected demand plays a minor role here, but we think the price cuts were mostly the result of production of scale, hot competition and reduced production costs.

The end result is that plug-in vehicles now cost 15% less than they did in 2012, which means more buyers will see them as affordable, thus almost certainly leading to higher sales.

Price Comparison Graph Courtesy of kdawg - Note 2014 i-MiEV Will Become Cheapest EV in US Due to Substantial Price Cut

Price Comparison Graph Courtesy of kdawg – Note 2014 i-MiEV Will Become Cheapest EV in US Due to Substantial Price Cut

Source: Wall Street Journal

Category: General

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11 responses to "As New Vehicle Prices Rise by 1.1%, Plug-In Vehicle Prices Fall by 15% Over Past 12 Months"
  1. Dan Frederiksen says:

    Hehe, it’s hardly a score that the price drops 15% if it was more than twice overpriced to begin with. Don’t be a sheep.

    1. Nate says:

      Don’t be a troll.

      1. Ocean Railroader says:

        I kind of think the price cuts are a mix of battery and parts costs falling 8% to 12% along with the prices being a little over priced to begin with.

        Mitsubishi i-Miev would fit this bill in that when you look at it really doesn’t look like it is worth paying $30,000 but if it where say $15,000 that would seem more fitting. The price cut it had was most likely the market resetting it to reality which in turn will at least double it’s sales as more people find the lower price more fitting.

        1. Dan Frederiksen says:

          It’s not a drop in battery prices. Since 2006 we have probably dropped from around 300$/kWh to 180 for the most cost effective of reasonable quality (laptop cells). I believe Tesla revealed that the roadster cells cost around 20k$.
          for the 16kWh in an iMiev that would be a cost drop of less than 2500$. yet since its introduction in 2009 it has dropped from 50k$ to 23k$, about ten times greater than the drop in battery prices.
          There is only one explanation which I have offered many times. They are morons.
          As I have always told you, all the EVs are massively overpriced. The prices doen’t reflect the component costs at all. It’s a bunch of reluctant nitwits who dislike electric drive who find a way to make it expensive.
          Tesla being the exception where they just suck at cost optimization in part because they just jam their cars full of batteries, weight and cost be damned.

      2. Spec9 says:

        Dan is a troll. He can’t help it.

    2. brotherkenny says:

      It really depends on what you mean by twice overpriced. If you mean they sell them for twice what they cost to build now, then your estimating a little low on their current costs. If you mean they sell them for twice what it would cost them if they would build at a quantity that would bring their cost down and allow them to make a profit at half cost, then that is probably correct. Also, you should be aware that here in the US people are taught in our educational system to be conformists, and that all others are trouble makers. Thus, when you call people sheep, at least in the US, you are in fact complimenting most. They take pride in their lack of independence and their compliance to the masters demands. They think themselves smart for doing as they are told.

  2. scottf200 says:

    Chart would be better if it had 2 lines for each car. Before and after Fed Tax. Ignore state. Small batteries smaller rebate.

  3. MikeJ says:

    I’m having a chat with a local Mitsu dealer about a 2012 i-Miev, which he would like to sell me as used (no rebate) for 19,700. He claims the car originally listed for over 30k, and they would be taking a bath to take much less. While I am sorry he is holding de-leveraged inventory vis-a-vis the 2014 version, which will be in the 17k range after rebate, he is crazy to ask for more than about 10 for this already outdated econo-box. So that is the downside of price drops… all those dealers who are holding dated inventory are seeing red, in more ways than one.

    Can someone out there with some inside knowledge of how car dealerships work answer some questions for me? How will, in 2016, the just-off-lease 2013 Nissan Leaf, with a residual of 22k, get sold for any more than 12 or 13, if the 2016 has a great heater and 150+ miles range at $21k after rebate? Honestly, how will my Mitsu dealer get rid of his i-Miev, whose [already anemic] battery has aged 2 years on his lot, and suffered two winters of being allowed to sit at 0% SOC at 0 degrees? Will they just take top offer for these cars at some point, and write the losses off on their taxes? When? Will they tell those of us who offer 10k to kindly pound sand and just crush the cars? Does the manufacturer insure the value of the cars by back-filling dealership losses? If so, how does the manufacturer itself stay right side up… with the wave of these cars that will be coming through in a couple years, with more to come as they continue to improve the tech and reduce price? These guys are already fighting for market share in a low-to-no profit market. Uh.

    As with most things in life, I just don’t get it. I just don’t see how my Leaf could go for more than 12 or 13k in 2016… and maybe even less than that. My guess is they will [have to] add value back into the legacy EV’s by offering to put their latest battery tech into their older cars for a nice price. Or 3rd party companies will fill that need. Watching all of this unfold over the next 2-5 years will be fascinating. But then again I’m easily fascinated.

    1. Ocean Railroader says:

      I saw a used 2012 i-Miev at one of my local car dealerships for $18,900 I went to look at it the day I found out the I-Miev had a massive $6000 price cut. It didn’t look like a bad car kind of like two smart cars put together in terms of size. What’s crazy now is do to the price cut it is now cheaper by a few thousand to buy a new one then a used one.

      I think what will happen to it and the other older model EV’s is that the existing car sellers will unload them at rock bottom prices during some type of sales event where they mark down all the cars that didn’t sell.during the year when they figure they are not going to get top dollar for the car. The same thing also goes for gas powered cars in my area such as the dear will try to sell the car at top dollar but once reality sets in and they can’t sell it at what they want they dump it during a clearance event. When one of these happens it’s not uncommon for them to cut off a $10,000 to $5,000 off of a sticker price for a car. Another place where the used EV’s will end up going to is on ebay in that as of now the used Leafs are holding their value steadily in the $14,000 to $18,000 dollar range depending on what region the EV is in and the local market.

      Oddly something like this would benefit me in that I’m right now looking for a cheap used EV in that a lot of people who would want one don’t have $20,000 lying around. If I bought a used EV for say $8000 and it cost $3000 to put a new set of updated higher range batteries in it I would do it.

  4. Spec9 says:

    That graph seems way out of date. It doesn’t have the price cuts in it.

  5. Rick says:

    Fifteen percent less than too much is still too much, but at least they are going in the right direction, and quickly.