Those looking to re-sell their EV could be getting less than they expect with the current trend. (Source: Getty\/TikTok\/Paul Maric) <\/p>\n
Electric vehicle (EV) buyers<\/a> are being warned of the tens of thousands of dollars<\/a> that will likely be wiped off the value of their cars when they\u2019re put back on the market. Resale value<\/a> is one of the biggest issues plaguing the industry as rapidly evolving EV technology<\/a> quickly makes older models less appealing.<\/p>\n Cox Automotive found EVs only hold 55 to 60 per cent of their value after three to four years<\/a>. That\u2019s fairly dire compared to internal combustion engines (ICE) that use petrol or diesel, which typically hold a resale value of 75 to 80 per cent.<\/p>\n CarExpert.com.au founder Paul Maric told Yahoo Finance EV owners should upgrade their car every two years to ensure they don\u2019t lose too much value on their investment.<\/p>\n RELATED<\/p>\n \u201cOnce you get to the point of three or four years old, you’re getting to the end of the new car warranty and you’re halfway through the battery warranty.<\/p>\n \u201cNo one really knows what’s going to happen in 10 years after an EV is produced. You don’t know the cost of having to replace a battery.\u201d<\/p>\n He pointed to the Nissan LEAF, the world’s first mass market electric and zero-emission vehicle.<\/p>\n While some of the earlier generations of the vehicle were able to go up to 200 kilometres on a single charge, he cautioned that an older version might have a significantly shorter range before it needed to be recharged because of how the batteries degrade over time.<\/p>\n \u201cTwo years is that sweet spot and means that you can manage your depreciation effectively. If you are holding on to it longer, you just need to be prepared for a lot of volatility, a lot of volatility in that market,\u201d Maric said.<\/p>\n Do you have a story? Email stew.perrie@yahooinc.com<\/a><\/p>\n Tesla has slashed the price tag on its Model Y by $16,000 over the last few years, with the Rear-Wheel Drive version now costing just $58,900.<\/p>\n It was the most purchased EV in Australia for the first half of this year and one of the most popular year-on-year. But if that car wound up on the second-hand market by the end of the decade, it might only be able to fetch around $32,395, according to the lower end of Cox\u2019s analysis. That equates to a $26,505 drop in value.<\/p>\n It would be even more brutal for those who bought before the car manufacturer started slashing its prices in late 2022.<\/p>\n \u201cIf you were someone like me who took out a novated lease on a Model Y at $70,000,\u201d Maric told Yahoo Finance. \u201cThat three or four-year lease is about to come up to its expiry, and I now have to pay a balloon payment on that car, which is the residual payout amount for the car.<\/p>\n \u201cWe’re at the point now where the balloon that I’m paying is more than what the car is worth on the second-hand market. So now it’s basically a fire sale.\u201d<\/p>\n The huge plummet in resale value is largely down to how fast EVs have been able to outdo their predecessors in the defining component of the car: the battery.<\/p>\n It seems like every year, manufacturers reveal they have discovered a new technique that allows their vehicles to go further on a single charge, which aims to reduce range anxiety that concerns many owners and potential buyers.<\/p>\n ICE cars, by comparison, have very little change in their petrol or diesel range, and the main updates year-to-year is how the vehicle looks and drives.<\/p>\n If an EV in Australia can go an extra 100 kilometres compared to one from two years ago, that latter one might not be as popular amongst second-hand buyers who want the best bang for their buck.<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n Tesla has taken a hit to sales this year but still dominates the EV market. (Source: Reuters) \u00b7 REUTERS \/ Reuters <\/p>\n