KBB: Fiat 500e, Smart Fortwo ED and Nissan LEAF Expected to Depreciate the Most Out of All Automobiles Available Today

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DEC 27 2013 BY ERIC LOVEDAY 23

KBB Says LEAF Will Be Hit Hard by Depreciation

KBB Says LEAF Will Be Hit Hard by Depreciation

USA Today contacted the folks at Kelley Blue Book with this special request: can you provide us with a list of the automobiles that are expected to depreciate the most over the next 5 years?

Fiat 500e Expected to Depreciate Rapidly

Fiat 500e Expected to Depreciate Rapidly

KBB responded by providing a list.  All of the vehicles on that list (the ones mentioned by USA Today at least) are plug ins.

As USA Today reports:

“Plug-in electric cars may be cutting-edge technology, but an analysis suggests that most will depreciate more dramatically over five years than their conventional counterparts.”

“Some of the biggest value gaps involve 2014 models powered only by batteries, entirely without gas engines…”

USA Today provides specific 5-year depreciation percentages for some of the plug-in vehicles:

  • Chevrolet Spark EV – Expected to be worth 28% of its $28,305 list price in 5 years – ICE version expected retain 40% of its value in 5 years
  • Ford Focus Electric – Expected to be worth 20%  of its $35,995 list price in 5 years – ICE Focus Titanium version to retain 36% of its value in 5 years
  • Nissan LEAF – Expected to be worth 15% of its 2013 (no Model Year 2014 LEAF exists in the US yet) Model Year list price in 5 years

    Smart ED Makes the Rapid Depreciation List Too

    Smart ED Makes the Rapid Depreciation List Too

The biggest depreciators, according to USA Today, are the Smart Fortwo ED, Fiat 500e and Nissan LEAF.  Though USA Today doesn’t list the depreciation values for the Smart ED or the electric Fiat, we assume they both come in at ~15% of their new value in 5 years time since USA Today lists all 3 as having the highest depreciation.

Eric Ibara, director of residual consulting for KBB, told USA Today that customers “have been willing to buy a new one, not a used electric vehicle.”

USA Today even got Nissan to comment on the situation. Erik Gottfried, director of marketing for the Nissan LEAF, told USA Today this:

“We expect to see a similar adoption curve for used EVs as we have for new EVs, and we are just now reaching the point where there are used EVs on the market.  EVs are one of the most active and fast-moving segments of the automotive market.”

Pure electrics are expected to depreciate significantly, according to KBB, but plug-in hybrid should fare much better.

KBB predicts the following

Prius Plug-In Expected to Hold Its Value Fairly Well

Prius Plug-In Expected to Hold Its Value Fairly Well

  • Toyota Prius Plug-In Hybrid to retain 35% of its value in 5 years
  • Porsche Panamera S E-Hybrid to retain 37% of its value in 5 years

Of course, USA Today omitted several BEVs and PHEVs from its story on the topic of plug-in depreciation, so we don’t get a complete picture of what’s to be expected,

Again, in this rapidly evolving and constantly changing market, it seems leasing in the way to go for now and these expected depreciation values further reinforce that.  At least that’s how we see it.

Source: USA Today

Categories: Fiat, Nissan, Smart

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23 Comments on "KBB: Fiat 500e, Smart Fortwo ED and Nissan LEAF Expected to Depreciate the Most Out of All Automobiles Available Today"

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Lol, what a crock. When there five year old Nissan Leafs available for $3,195, let me know and I’ll buy two. Even if you fail to account for the $7,500 tax rebate, that would still be $4,320. I’ve been looking for used Leafs or Volts, and their resale value has remained stubbornly high. I haven’t seen a three year old used Leaf for under $17,000 yet, and I haven’t seen a three year old Volt for under $19,000 yet.

I that they do depreciate a little so that I can buy one, but it’s not happening!

Agreed.
Not sure if they’re accounting for the $7500 rebate.
Nissan needs to announce a replacement price for the battery.

It is very ignorant and misleading that KBB, USA Today, and InsideEVs have all have failed to account for the effect of the current $7500 federal incentive. Some currently states offer additional incentives (CA, CO, GA are examples). Is the current (and five-year) depreciated used EV sales price any lower in these states? Basing depreciation on projections from MSRP vs. actual sale values could hurt owners leasing in 2014 as the “residual value” will be depreciated and owners will needlessly be over paying. With the current sales trend; LEAF, Model S, and Volt will each exceed 200,000 accumlative sales each in the next 3-4 years. (Current sales numbers: Volt: 50,000+, LEAF: 40,000+, and Model S: 20,000+) With no more tax incentive, the real purchase cost of a new EV model will be $7500 more than it would be in 2014. The effective purchase price increase ($7500 being added back on to used price, which KBB ignores) will also impact used EV sales values. EV models with manufactures expected to sell greater than 200,000 in five years (having lower depreciation) – eNV200 (van) – LEAF – Model S – Model X – Volt EV models expected to sell less than 200,000… Read more »
The Leaf’s biggest challenge is it’s battery. And anyone looking at buying a used EV, that have done any research, will see that….and avoid it. It’s the ONLY EV with a capacity loss ‘clause’ in their warranty, and a $100/mo never ending lease of a refurbished, minimum 9 bar capacity battery. Which is pointless, since the drop to 9 bars is why many will need to seek a ‘replacement’ so they can use the EV as they intended when they leased/bought it. But the Spark EV and Focus Electric, Volt, Model S have more expensive thermal protected battery packs, and a battery management system to extend battery life well beyond 200k miles before any loss of capacity or range. Along with a 10 year 100k warranty in Ca, where these EVs can have several owners before any concern about the battery. The Leaf is great to lease, just as long as you are the ‘first’ to lease it. Then if you really want another Leaf, just lease another in 3 years, no problem. But what Nissan is going to do with the stockpile that starts to build in 2014-2016 as the 2012 and 2013($199/mo lease) models start to return from… Read more »

Couldn’t have said it better Bloggin, +1

Some corrections:

While Nissan mentioned the $100/mo lease, it was hit with so much negative feedback that they have yet to bring it up again. If they do bring this back, they will also announce a price to outright purchase a replacement pack.

The other EVs may have a more durable battery than the LEAF, but there’s no way they will make it to 200k miles without loss of capacity. If that were true, they would all warrant the capacity of the pack. None of them do. Browse the Tesla Motors Club forums, and you will see that many are seeing 5% loss after a year and 20k+ miles.

Yes, you are correct that it is wise to lease the LEAF – unless you live in a cool climate like the pacific north west where the battery lasts much longer.

The $100 a month gets you a new 12 bar battery, not a 9 bar one. If you have a warranty replacement you get a battery that is guaranteed to have 9 bars or better, so far the warranty replacements have been new batteries.

I believe the cause for the higher depreciation is that they are looking at MSRP versus resale value, not taking into account the tax credits. We have leased two EVs and soon they will be going back and I’m going to be in the market for used Evs. (I’d buy my own but the residuals are way too high) I would love to see some lower prices on the used Volts, but I’m just not seeing them.

Depreciation is always based on the MSRP. Whoever you get to help pay for your new EV is really of no consequence to KBB.

Sure, but at least a mention of that is still necessary to properly understand the market. No one pays MSRP for an EV when they buy it new (unlike almost all other types of cars) and that’s a fact that needs to be mentioned. Otherwise people at glance would just think they are horrible value.

“…at least a mention of that is still necessary to properly understand the market.”

Oh, I understand the market. It is propped up by public funds. It will be really interesting to see what happens to EV sales when that $7500 is no longer available.

“Otherwise people at glance would just think they are horrible value.”

Gee, I wonder why they would think that?

“Oh, I understand the market. It is propped up by public funds.”

Yeah, it’s not AT ALL like the internal combustion industrial complex.

Actually, it matters a lot. Because once the credits disappear, the resale values on these used EVs will rise. The reason should be obvious. The out-of-pocket cost of buying a new EV will rise and thus the used ones will follow.

Just more proof that EV buyers have their heads in the kool aid (mixed metaphor intended) when it comes to understanding the economics of EVs.

$4950 for a well kept 2011 Leaf 5 years old
the math just doesnt make sense

but if they are right I’ll take one too!

Actually the math will make perfect sense. The price of a used EV will be determined by a free market, unlike it’s original new car price, which is supported by public funds (and arguably faulty public policy), giving buyers the impression they are getting a “good deal”. But its used car value will end up revealing the truth about the economics of EVs. EV owners may ending up taking a bath on the trade in, but at least they can take some comfort in the fact that Uncle Sam (i.e. taxpayers like me) has absorbed a big part of that loss. You’re welcome! 🙂

I hope they’re right.

The used market will be red hot if the cars are available at such insanely low prices.

I’ll take two!

Sing me in too, I need two Leaf for less than 4K.

Leaf is horrible, its super ugly and is just crap in general, the smart ed and fiat 500e are incredible tons of fun to drive, best EV’s you can get on the market (and the volt) and they are the best looking ones too

I am planning to offer $10-13,000 for my Leaf when it comes off Leaf in July of 2016. The residual on it will be $22,000. The reason has little to do with remaining battery life or warranty. It will be mostly due to the (expected) availability of new and better BEV’s at the 15-18,000 price point, after tax rebate. Spark is not currently available in my state. But what is to keep me from buying a used one in 2016 from someone in CA or OR? What if new ones are available in my state at that time? What will be their price and range? What about the ugly i-Miev, if they are still around? Will the new Leaf have >100 mile range in 2 years? I am expecting my gently used, garage-kept, well-maintained Leaf will be up against some pretty incredible competition. If I am wrong AT ALL, then I will be probably wrong A LOT, and either a) consumer BEV production will have virtually stopped, thus sending prices higher, or b) the government stops the rebates, effectively changing the game entirely. My guess is that the dealer will be stubborn about my offer and wind up sitting on… Read more »

When it comes off LEASE, rather…

I am hoping that Nissan will have new 150 mile battery packs available for my Leaf when my lease is up in three years. I am trying to take good care of my current battery so as to maintain its trade in value. I expect that the rest of my Leaf will be quite serviceable.

As an EV leasee, I didn’t get into the car for resale value. I got it to minimize my transportation expense. KBB has no idea what used EV’s will sell for, they proved that they were clueless back in 2011 when they said that a LEAF had higher operating cost than a Volt http://www.greencarreports.com/news/1072705_2012-volt-cheaper-to-own-than-2012-leaf-says-kelley-blue-book (silly). The life cycle of an EV is very different than that of an ICE. As the EV-battery after market develops, we will start to see the used EV market take shape.