Posted on 03/09/2015 11:00:12 AM PDT by thackney
...Mr. Hoban expects between 100 and 150 of the leased vehicles to be returned to his Capitol City Nissan dealership on a monthly basis over the next two years as their leases expire. The problem: used Leafs aren’t attracting much demand.
With gas prices down 33% from a year ago, and buyers cooling toward electric vehicles, some auto makers are offering deep discounts or attractive leases on battery-powered vehicles and plug-in hybrids. Nissan, for instance, slashed the price of a new Leaf by $6,400 in 2013 and is now offering a $199-a-month lease, or $3,500 cash back and 0% financing for 72 months, on brand new Leafs.
Buyers who also get a $7,500 federal tax credit on purchase of a new Leaf, see little reason to shop for a preowned model and some worry the expensive batteries could have to be replaced. “Used Leafs haven’t really taken off,” Mr. Hoban said. “There is really no incentive to buy a used one when you can lease a new one for less.”
This has driven down resale values of plug-in electrics including the Leaf and General Motors Co. ’s Chevrolet Volt, representing another hurdle for auto makers trying to boost sales of alternative-fuel vehicles.
Other electric cars, including plug-in versions of Ford Motor Co. ’s Focus and Toyota Motor Corp. ’s Prius, are depreciating as fast as the Leaf with the average trade-in value in 2014 falling between 22% and 35%, depending on model, according to the National Automobile Dealers Association’s Used Car Guide. The depreciation rate on plug-in electric cars is nearly twice that of a comparable gasoline-engine car, NADA Used Car Guide found.
In December and January, for instance, the average selling price of a 2012 Nissan Leaf at auction was about $10,000, nearly a quarter of the car’s original...price....
(Excerpt) Read more at wsj.com ...
That would be the low end of many estimates that I’ve heard over the years. Some as high as $10,000. So no, I don’t think you’ll save anything.
I’ve been telling my family for years, never buy a used electric car. Precisely for this reason.
Then I tell them not to buy one new;
* Mining of lithium and related energy costs
* Shipping of lithium across the oceans to be processed
* Processing of material
* Manufacturing of actual battery units
* Just because nothing comes out a tailpipe you shouldn’t think that it is environmentally friendly, plus the electricity has to come from somewhere.
* Then you’ll have to replace the batteries at some point.
There’s a couple of liberal/greenie types - they don’t like hearing it. They’ve even asked, “if they’re so bad why do they sell them?”. lol - because morons like you will BUY them. It’s as though they’ve no idea about big business and how big the “green” industry is. They believe anything, like the sea-level is rising (only) in Florida.
Amazing.
The problem with this article is that, when it discusses numbers for resale value, it ignores the $7,500 tax credit and the several-thousand-dollar reductions in MSRP in 2013 to the Leaf and the Volt. There was a similar article to this one back in August about the Volt. I'll just copy and paste a bit of the argument I made then:
...there are a few facts that NLPC glossed over in this article in order to arrive at the 65% loss-of-value figure.
First of all, that figure does not include the fact that the 2014 Volt’s price was dropped to $35k whereas the previous years were $40k. Any time a new model’s price drops, all the older models’ resale value drops along with it. (For example, if you buy a widescreen TV for $3,000 and then the next day it goes on sale for $2,000, good luck trying to sell it to your neighbor for $2,500.)
Secondly, and more importantly, the figure does not include the $7,500 tax rebate that anyone can get when they buy a new Volt. So to get the true cost for a new Volt you have to take the MSRP and subtract $7,500. That is the number that you can then compare to the used value in order to calculate the true “loss-of-value” percentage. So if you pay full MSRP for a new Volt then your true cost will be $35,000 minus $7,500 which is $27,500.
Using that value you get 46% for your loss-of-value figure, which is pretty good by industry standards. In fact, back in 2012, Kelly Blue Book rated the Chevy Volt as the “Best Electric Car” in its 2012 Best Resale Value Awards. Granted, the Volt didn’t have much competition back then.
http://www.freerepublic.com/focus/bloggers/3190496/posts#28
I didn't even mention in that post that there is an additional $1,000 to $6,000 state tax credit in the states where most electric cars are sold. California, the state with the most EV sales, has a $2,500 credit.
The author of this article clearly knows about the $7,500 federal tax credit and the price cuts because she mentions them elsewhere in her article. Yet she never discusses their obvious impact on the numbers for resale value.
“Its not a matter of being against electric cars but we know they make a lot more waste product in their production and then where do the used batteries go? Is that another form of polution.” —Uversabound
“Yup, and a very nasty one. Counting the pollution created during manufacturing and battery disposal, electric cars are in fact FAR more toxic to the environment than gas vehicles IMHO.” —piytar
Contrary to what you might read in the comments section around the internet, lithium ion batteries are not toxic. Lead acid batteries are far more toxic and we handle them just fine. (Just google lithium battery toxicity and read any of the results.)
Also, these batteries are way too valuable to not be reused or recycled in some way. There is a market for second-hand automotive batteries for homeowners with solar panels. Furthermore, Tesla and Toyota at least have recycling programs for the batteries in their vehicles. Regarding Toyota:
Forget those fears that hybrid and electric vehicles will result in landfills full of dead batteries.
When Toyota hybrid battery packs reach the end of their lives, every piece is recycled. And it's all because of a program launched a year ago by Toyota Motor Sales U.S.A. and its dealers.
http://www.autonews.com/apps/pbcs.dll/article?AID=/20120102/RETAIL07/301029980/1147
“One guy had one of the first prius’s and he had 220k plus and still had the original batteries and running strong.”
In our cul de sac there are several Piuses, and 3 have been going up and down our street and hill forever. One family we know has passed on their original Pius to a son, and he has passed it on to his daughter. They drive like crazy and the biggest expense is new tires every 3-4 years due to tire breakdown. Heirs line up to get mom/dad/gramps’s piuses.
“Well...it was a large Mall parking lot but there were two of them right in front of Kohl’s with a sign, ‘Sponsored by Kohl’s’.”
If our Kohl’s ever gets one of those with the sponsored by Kohl’s, I will not go in even on Wednesdays to cherry pick and get the Kohl’s green bucks which we give to our grandkids.
I wouldn’t worry. Electricity is super cheap compared to gasoline and from a business sense, it is well worth it to provide $0.50 worth of electricity if it means bringing a customer into the store.
This car dealer with the “Leaf” problem didn’t sell those cars , he leased them... a whole lot of them , 150 to 200 a month for years on end... now he’s starting to get the 2012’s back at lease end...
There is no mention of the tax credit of $7,500 in the article .... at least when it comes to residual value... The person leasing the car didn’t get it because it wasn’t a purchase ... who got it? The dealer? Nissan Motor Credit? Somebody pocketed the cashola...
This isn’t the full story...
The finance company gets the $7,500 and then passes that on to the customer in the form of a cheaper lease. That is why these leases were so popular, because the tax credit was bringing the price down.
Well if Nissan Motor credit ran the lease as a $0/$0/$0 at full retail minus the $7,500 to get the $199 lease rate and assuming a 50% residual value after 48 they got their kicks at inception ... and lost it at turn in with the bad residual value...
I’m not losing sleep over their problem... but I’m not buying a full electric... if they ever offer a turbo-diesel Sentra to go against the Cruze diesel at a good price I’m in on that...
We know. Duh.
Better the generators be high efficiency large scale operations dedicating significant resources to scrubbing exhaust and minimizing emissions dumped into remote locations, than be small portable units of necessarily low efficiency and much higher emissions where people’s lungs are.
It’s not zero emissions, but it’s way better than the alternatives. The >100 MPG equivalent helps.
Leafs are taking over the Atlanta region. “Small and fragile” doesn’t describe it; makes for a good family-sized runabout with great acceleration. Nothing anemic about it.
The Leaf is ugly enough that it won’t look “dated”.
There really isn’t much to fix on it beyond brake pads & air filters. All the maintenance cost & consternation is concentrated in the battery.
Free charging at stores is a cheap loss leader. At a nominal $1/hr for paid charging, the store is out maybe $20/day max to attract hundreds/thousands of dollars in revenue.
Your “gift card for free gasoline” would equate to less than $0.25 per hour you’re in the store. (One hour of charging gets you around 25 miles for a 100 MPG equivalent vehicle.)
Remember the Aztec?
An aside first; It’s the only car ever designed and engineered by a 100% female team. I notice no one else has ever tried that again.
Anyway, I have a friend who works for GM (they were responsible for that car being brought to market), and he told about how each dealership would have a quota of sales of Aztecs to meet.
After dark, guys from one dealership would drive their Aztecs over to another dealerships lot and leave them there, sort of ‘getting them off their own lot’.
As a former GMer, I call total BS on this one. For one thing there weren't that many women in styling, engineering, and development back in the mid 90s even if they wanted to do it this way.
Tom Peters was the head stylist on the program and Mark Reuss was the Vehicle line executive.
I currently own 2 vehicles, a Prius and an F350. Guess which one has had the lowest total cost of ownership to drive? I’m glad to see the price come down on the Prius. The Prius is the best car I ever owned. I’d buy another one without a second thought.
Understand, this article was talking about “pure” electrics, not hybrids with a gasoline engine.
It was also talking about plug-in hybrids like the Volt, which of course has a gasoline engine.
You are right, it did go on to include hybrids.
Seems like battery life is a much bigger issue for “pure” electrics.
If batteries many years later are at half the capacity, it would be a much bigger impact for a Leaf than a Volt. Half the range versus lower efficiency.
The Volt has been on the road for four years and there seems to be a consensus among owners that there is virtually no capacity loss. People criticized GM for the initial price of the Volt but their engineering team seems to have pampered the hell out of the battery pack. Theirs and Tesla's packs are liquid cooled, unlike the Leaf.
Agreed. The all electric has more limited applications for vehicles than a one that can be fueled with gasoline. For some folks it would work fine, but not yet for most.
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