Residuals on large EVs
Discussion
Not sure if this should go in the EV or car buying thread, but here goes...
We’re trading in the family bus (Grand Cherokee), and looking for our next. Mrs T is not on board with an estate, so if we’re going to end up fuelling a 2 ton car it feels like we should consider BEVs (we can charge at home and rarely do very long journeys). Given this will save c£200 in fuel per month vs the Jeep, man maths has given me a budget of £500per month (we paid £300pm for the GC).
Doing a few sums, I think this could open up a used I-pace or potentially a brand new Enyaq/Ioniq 5. Assuming I get one of these for £40k, I’d hit my £500pm budget provided in 3 years time I can sell it for c£26k (roughly £4.6k depreciation a year)
A few questions:
- Do forecast residuals on BEVs look in line with the above - or should I expect to lose a lot more than this?
- What do you think will depreciate less - a brand new enyaq/ioniq 5 or a 2 yr old I pace?
I’m not particular well versed in battery tech, so feel a bit nervous trying to estimate what is going to happen to values
We’re trading in the family bus (Grand Cherokee), and looking for our next. Mrs T is not on board with an estate, so if we’re going to end up fuelling a 2 ton car it feels like we should consider BEVs (we can charge at home and rarely do very long journeys). Given this will save c£200 in fuel per month vs the Jeep, man maths has given me a budget of £500per month (we paid £300pm for the GC).
Doing a few sums, I think this could open up a used I-pace or potentially a brand new Enyaq/Ioniq 5. Assuming I get one of these for £40k, I’d hit my £500pm budget provided in 3 years time I can sell it for c£26k (roughly £4.6k depreciation a year)
A few questions:
- Do forecast residuals on BEVs look in line with the above - or should I expect to lose a lot more than this?
- What do you think will depreciate less - a brand new enyaq/ioniq 5 or a 2 yr old I pace?
I’m not particular well versed in battery tech, so feel a bit nervous trying to estimate what is going to happen to values
I was all set to pull the trigger on the I-Pace this weekend just gone and have taken a step back because I can no longer get it to stack up, breakdown below of my rationale:
Model Year - The reports on the Touch Pro infotainment are pretty dire and, having used the PiviPro system extensively on my 5hr test drive at the weekend, I can't see myself spending that much on one without getting a MY21 model to ensure PiviPro.
Spec - SE is the minimum spec I'd consider, personal preference on this one but the tiny wheels on the S and the other missing features just make it hard for me to stomach at that pricepoint. Easy for me to avoid the HSE model as I'm not fussed about the windsor leather seats which make up the majority of the 5k price uplift from the SE.
Residuals - Residuals on the quote I got at the weekend had a brand new car with only £2k of options set with a 62k price after all discounts come back with just a £25k residual after four years, so 40%. I could just about stomach that but the 5.9% APR and the recent offerings from Hyundai/Skoda/Kia have me thinking that the Jag and Audi are really going to suffer with residuals as the electric SUV market opens up. They just aren't competitive with range, charging speed, interior space etc and yet have a 60% premium cost over the competitors. I feel like I'd be paying £9k/year to drive around in a car that was quickly outdated.
Having said all of that... The I Pace is still an absolutely cracking car and I love it, I just can't get my head around the numbers at the moment and it looks like I'll be getting a lease or cash purchase for 1-2 years whilst waiting for the Ioniq 5 to be available, at which point I'll happily place an order without a test drive.
Model Year - The reports on the Touch Pro infotainment are pretty dire and, having used the PiviPro system extensively on my 5hr test drive at the weekend, I can't see myself spending that much on one without getting a MY21 model to ensure PiviPro.
Spec - SE is the minimum spec I'd consider, personal preference on this one but the tiny wheels on the S and the other missing features just make it hard for me to stomach at that pricepoint. Easy for me to avoid the HSE model as I'm not fussed about the windsor leather seats which make up the majority of the 5k price uplift from the SE.
Residuals - Residuals on the quote I got at the weekend had a brand new car with only £2k of options set with a 62k price after all discounts come back with just a £25k residual after four years, so 40%. I could just about stomach that but the 5.9% APR and the recent offerings from Hyundai/Skoda/Kia have me thinking that the Jag and Audi are really going to suffer with residuals as the electric SUV market opens up. They just aren't competitive with range, charging speed, interior space etc and yet have a 60% premium cost over the competitors. I feel like I'd be paying £9k/year to drive around in a car that was quickly outdated.
Having said all of that... The I Pace is still an absolutely cracking car and I love it, I just can't get my head around the numbers at the moment and it looks like I'll be getting a lease or cash purchase for 1-2 years whilst waiting for the Ioniq 5 to be available, at which point I'll happily place an order without a test drive.
Togneri said:
A few questions:
- Do forecast residuals on BEVs look in line with the above - or should I expect to lose a lot more than this?
- What do you think will depreciate less - a brand new enyaq/ioniq 5 or a 2 yr old I pace?
I’m not particular well versed in battery tech, so feel a bit nervous trying to estimate what is going to happen to values
One particular metric is missing here for me: how much has the 2 year old I Pace depreciated already?- Do forecast residuals on BEVs look in line with the above - or should I expect to lose a lot more than this?
- What do you think will depreciate less - a brand new enyaq/ioniq 5 or a 2 yr old I pace?
I’m not particular well versed in battery tech, so feel a bit nervous trying to estimate what is going to happen to values
I think the biggest hit for the very much first gen big EV's is still to come.
As you've seen, a lot cheaper and arguably better cars in most areas are coming out. Now availability of a good big 40k EV is low. Once there are some decent new ones, I can see the e-trons and i-paces taking a serious hit second hand.
Togneri said:
Doing a few sums, I think this could open up a used I-pace or potentially a brand new Enyaq/Ioniq 5. Assuming I get one of these for £40k, I’d hit my £500pm budget provided in 3 years time I can sell it for c£26k (roughly £4.6k depreciation a
How does that maths work to ensure you stick to a £500/month budget?? I can't get my head around it.Generally speaking EVs tend to hold there value very well. My 10yr gold leaf is still worth what I paid for it this time last year (5k) granted, it's at the bottom of the curve now.
dave_s13 said:
How does that maths work to ensure you stick to a £500/month budget?? I can't get my head around it.
It's based on a £500pm PCP, 5% APR, initial deposit of £5k . I'd receive the £5k deposit back in full if the car was worth £26k at the end of the 3 years.J1990 said:
Residuals - Residuals on the quote I got at the weekend had a brand new car with only £2k of options set with a 62k price after all discounts come back with just a £25k residual after four years, so 40%. I could just about stomach that but the 5.9% APR and the recent offerings from Hyundai/Skoda/Kia have me thinking that the Jag and Audi are really going to suffer with residuals as the electric SUV market opens up. They just aren't competitive with range, charging speed, interior space etc and yet have a 60% premium cost over the competitors. I feel like I'd be paying £9k/year to drive around in a car that was quickly outdated.
Interested in that £25k figure for a 4 year old i-pace. Given they're £62k new (after discounts etc), and £40k after 2 years, it does feel like quite a big decrease in years 3/4. If that's reasonable though then would need to pull the plug on it (...sorry).In terms of the Enyaq/Ioniq 5 - is the thinking that these will retain their values relatively well in comparison (owing to lack of competition in the used market) or is it simply not a good move to go for an electric SUV today?
J1990 said:
Residuals - Residuals on the quote I got at the weekend had a brand new car with only £2k of options set with a 62k price after all discounts come back with just a £25k residual after four years, so 40%. I could just about stomach that but the 5.9% APR and the recent offerings from Hyundai/Skoda/Kia have me thinking that the Jag and Audi are really going to suffer with residuals as the electric SUV market opens up. They just aren't competitive with range, charging speed, interior space etc and yet have a 60% premium cost over the competitors. I feel like I'd be paying £9k/year to drive around in a car that was quickly outdated.
Interested in that £25k figure for a 4 year old i-pace. Given they're £62k new (after discounts etc), and £40k after 2 years, it does feel like quite a big decrease in years 3/4. If that's reasonable though then would need to pull the plug on it (...sorry).In terms of the Enyaq/Ioniq 5 - is the thinking that these will retain their values relatively well in comparison (owing to lack of competition in the used market) or is it simply not a good move to go for an electric SUV today?
The badge should help... I'm just not convinced enough that the badge will prevail over newer tech, especially with the public's huge level of range anxiety despite 99% of journeys that 99% of people do being well within the realms of what the current EVs offer in range.
I wouldn't be willing to get a 40-50k I-Pace on a high APR, it is literally cheaper to buy brand new with lower APR and stronger residuals if not keeping beyond the term. I don't think I can take the risk of forking out £50k cash for one and then potentially finding that the values plummet when it's a bit of a dinosaur in the market in just a few years.
Dont know about the I-Pace, but bigger EV's are keeping their value pretty well. The depreciation curve is different though. I have noticed that the Model S keeps it value better than an equivalent BMW or Mercedes, but it drops unevenly over time. Seems to coincide with warranty expiry for key components and potential repair / replace costs. Battery seems to be the big one, which has proven to be reliable, but its a major worry for buyers looking to drop $40k or so on the car. But that seems to be expected and models that have been available for a while do seem to hold their value well due to an emerging third-party repair community.
At the far end of the market though, the retained value difference is not so much though, as customers do seem to be more confident with petrol engines which can be repaired for a lesser cost. But again, if you are looking at a 5/6 year old Model S, its what you expect. 1-3 years old though, as long as there is a battery / powertrain warranty in place, they do retain their value well.
At the far end of the market though, the retained value difference is not so much though, as customers do seem to be more confident with petrol engines which can be repaired for a lesser cost. But again, if you are looking at a 5/6 year old Model S, its what you expect. 1-3 years old though, as long as there is a battery / powertrain warranty in place, they do retain their value well.
SWoll said:
What Enyaq model are you looking at OP, there are a lot of them?
That’s a good question! I guess I was looking at the larger battery ‘80’ model, though on reflection the base ‘60’ would probably work fine. Going fairly light on the options list this would come in a good bit cheaper (sub £35k) and would definitely be within budget. J1990 said:
I think the problem is that the Ioniq 5, Enyaq and ID4 will all have good models below the £35k threshold with tech and space that dwarfs the I-Pace - So in 2024 do you spend £25k on an I-Pace that's out of warranty or do you buy a 2 year old Ioniq 5 with 3 years warranty left and potentially still have some change left over?
The badge should help... I'm just not convinced enough that the badge will prevail over newer tech, especially with the public's huge level of range anxiety despite 99% of journeys that 99% of people do being well within the realms of what the current EVs offer in range.
I wouldn't be willing to get a 40-50k I-Pace on a high APR, it is literally cheaper to buy brand new with lower APR and stronger residuals if not keeping beyond the term. I don't think I can take the risk of forking out £50k cash for one and then potentially finding that the values plummet when it's a bit of a dinosaur in the market in just a few years.
All good points. While I find it very hard to believe I’d be better off buying an i-pace new than used (surely depreciation will tail off over time!?), I can definitely see the risk that in 2024 a 2 yr old VW/Skoda/Hyundai/Kia makes a compelling case against a 5 yr old Jag, and so this is reflected in the value of the latter. That being said, the i-pace will still be significantly cheaper than anything from the higher end of the market, which could mitigate this a bit?The badge should help... I'm just not convinced enough that the badge will prevail over newer tech, especially with the public's huge level of range anxiety despite 99% of journeys that 99% of people do being well within the realms of what the current EVs offer in range.
I wouldn't be willing to get a 40-50k I-Pace on a high APR, it is literally cheaper to buy brand new with lower APR and stronger residuals if not keeping beyond the term. I don't think I can take the risk of forking out £50k cash for one and then potentially finding that the values plummet when it's a bit of a dinosaur in the market in just a few years.
I guess this gets me back to the start. It's always going to be very difficult to predict what the value of an EV is going to be in 3 years time given the lack of data/comparables, so not sure if my '£40k 2019 i-pace being worth £26k in 3 years time' is reasonable or nonsense.
Togneri said:
Doing a few sums, I think this could open up a used I-pace or potentially a brand new Enyaq/Ioniq 5. Assuming I get one of these for £40k, I’d hit my £500pm budget provided in 3 years time I can sell it for c£26k (roughly £4.6k depreciation a year)
Its hard to see an iPace been worth less than £26K in 3 years time given its got a 90kWh battery and you need to be paying £45K for a new Hyundai with a 75kWh battery. Tesla are now selling a new design 85kWh pack for older cars out of warranty in the US for $20K fitted - though they have suggested this price might drop in future. That should give you some idea how much inherent value there is in a 90kWh battery pack regardless of the rest of the car.
off_again said:
Dont know about the I-Pace, but bigger EV's are keeping their value pretty well. The depreciation curve is different though. I have noticed that the Model S keeps it value better than an equivalent BMW or Mercedes, but it drops unevenly over time. Seems to coincide with warranty expiry for key components and potential repair / replace costs. Battery seems to be the big one, which has proven to be reliable, but its a major worry for buyers looking to drop $40k or so on the car. But that seems to be expected and models that have been available for a while do seem to hold their value well due to an emerging third-party repair community.
At the far end of the market though, the retained value difference is not so much though, as customers do seem to be more confident with petrol engines which can be repaired for a lesser cost. But again, if you are looking at a 5/6 year old Model S, its what you expect. 1-3 years old though, as long as there is a battery / powertrain warranty in place, they do retain their value well.
Oh that's helpful - I hadn't considered the model S as a good reference point. A brief check on values tells me:At the far end of the market though, the retained value difference is not so much though, as customers do seem to be more confident with petrol engines which can be repaired for a lesser cost. But again, if you are looking at a 5/6 year old Model S, its what you expect. 1-3 years old though, as long as there is a battery / powertrain warranty in place, they do retain their value well.
- There are far more versions of model S than I realised
- Today, the difference between a 2 year old and 5 year old model S is roughly a third (c£50k for a 'basic' 2019 Model S, c£33k for a 2016)
So applying that logic to the i-pace would suggest it could come in just in budget, though it's pretty marginal
Togneri said:
Oh that's helpful - I hadn't considered the model S as a good reference point. A brief check on values tells me:
- There are far more versions of model S than I realised
- Today, the difference between a 2 year old and 5 year old model S is roughly a third (c£50k for a 'basic' 2019 Model S, c£33k for a 2016)
So applying that logic to the i-pace would suggest it could come in just in budget, though it's pretty marginal
Don't forget to consider what a £40k combustion SUV will be worth in 2024 with the ban on new combustion cars very close to the horizon.- There are far more versions of model S than I realised
- Today, the difference between a 2 year old and 5 year old model S is roughly a third (c£50k for a 'basic' 2019 Model S, c£33k for a 2016)
So applying that logic to the i-pace would suggest it could come in just in budget, though it's pretty marginal
Togneri said:
SWoll said:
What Enyaq model are you looking at OP, there are a lot of them?
That’s a good question! I guess I was looking at the larger battery ‘80’ model, though on reflection the base ‘60’ would probably work fine. Going fairly light on the options list this would come in a good bit cheaper (sub £35k) and would definitely be within budget. If you are concerned about residuals etc then a 60 Nav Lodge can be had for £409 a month on a 3 year lease deal with no upfront payment.
gangzoom said:
Its hard to see an iPace been worth less than £26K in 3 years time given its got a 90kWh battery and you need to be paying £45K for a new Hyundai with a 75kWh battery.
Tesla are now selling a new design 85kWh pack for older cars out of warranty in the US for $20K fitted - though they have suggested this price might drop in future. That should give you some idea how much inherent value there is in a 90kWh battery pack regardless of the rest of the car.
Is the battery size that important if the efficiency of the vehicle is poor? A 3 year old model with ~20k miles can be picked up for £38k now in the bottom spec. Jaguar warranty the battery to have at least 70% usable battery capacity for 8 years, so at least there's some peace of mind that up until 8 years old the car should still be able to achieve 160miles real world, though that's again assuming you're on the entry level wheels and not the 20 or 22s which sap range.Tesla are now selling a new design 85kWh pack for older cars out of warranty in the US for $20K fitted - though they have suggested this price might drop in future. That should give you some idea how much inherent value there is in a 90kWh battery pack regardless of the rest of the car.
It's not that I don't think the car would be worth that much in isolation, it's that we're looking at something which is going through improvements at a rate which only seems to compare to the launch of laptop computers - Every few years the previous market leading, wallet busting models are in the bargain bins beacuse they're still as powerful and usable as they were but newer versions have come along that blow it out of the water.
Until battery replacement costs are at a much more affordable level the cars are going to suffer heavily as they approach the end of the battery warranty - Or perhaps a new breed of insurance comes out just for your battery replacement and people live a little easier. Either way, I can't see someone who's looking at a 5+ year old I-Pace being happy with the thought of a potential £10-20k battery replacement within their ownership timeframe, regardless of the statistics of actually 'needing' it.
J1990 said:
Until battery replacement costs are at a much more affordable level the cars are going to suffer heavily as they approach the end of the battery warranty - Or perhaps a new breed of insurance comes out just for your battery replacement and people live a little easier. Either way, I can't see someone who's looking at a 5+ year old I-Pace being happy with the thought of a potential £10-20k battery replacement within their ownership timeframe, regardless of the statistics of actually 'needing' it.
Good question and I am sure some enterprising company will fill the gap at some point.Its not the same thing, but its interesting to see values of a used Prius here in California. Any car (a couple excepted) that has valid tags (registration), isnt a death trap and can be smogged (yearly emissions check) is worth at least $2k - $3k all day. Dodgy colors, ripped interiors and the like - as long as it runs, its worth money. A Prius will keep its value better due to reliability and economy, so equivalent mileage and condition, they will be worth $4k - $5k, even though the original sticker price was less. Makes sense.
But there are pretty widespread catalyst thefts which cause a check engine light and it will fail the smog check (which is needed to renew the registration) and clearly economy drops and the battery will degrade over time and mileage. Any Prius with a missing catalyst or a battery that isnt charging correctly means the car is basically worthless. Seen 2010 and newer models with low miles and good condition going for less than $1k! Its fear of the battery replacement cost and catalyst replacement at $750 a go. So its priced into the value, but buyers just dont want the hassle.
Ok, so this is at the far end of the resale market, but I can see that buyers potentially looking at $10k+ for a battery replacement in an EV are going to price that into the value of the car. Some manufacturers do a good job here - Nissan and BMW seem to be good here, and there are a number of outlets that will do replacement / upgrades that will extend the life of the car. Checking online (for the US), seems that Jag offer an 8 year or 100,000 mile warranty on the battery. Thats pretty good and slightly better than some competitors. I have to imagine that selling a 3-4 year old I-Pace with say 40-50k miles is going to be easy. A 6 year old one with 90k miles on the other hand will be priced accordingly.
What does the data say? One set of results from Q2 2020 suggests the i-Pace will lose 49% of its value over 100k miles, and something like the Ioniq would lose 46% of its value over the same mileage
The results suggest Tesla Model S and X depreciate less over 100k miles
https://www.vanarama.com/car-leasing/blog/electric...
The results suggest Tesla Model S and X depreciate less over 100k miles
https://www.vanarama.com/car-leasing/blog/electric...
raspy said:
What does the data say? One set of results from Q2 2020 suggests the i-Pace will lose 49% of its value over 100k miles, and something like the Ioniq would lose 46% of its value over the same mileage
The results suggest Tesla Model S and X depreciate less over 100k miles
https://www.vanarama.com/car-leasing/blog/electric...
Does anyone actually pay list for an i-pace or e-tron though, unlike Tesla?The results suggest Tesla Model S and X depreciate less over 100k miles
https://www.vanarama.com/car-leasing/blog/electric...
raspy said:
What does the data say? One set of results from Q2 2020 suggests the i-Pace will lose 49% of its value over 100k miles, and something like the Ioniq would lose 46% of its value over the same mileage
The results suggest Tesla Model S and X depreciate less over 100k miles
https://www.vanarama.com/car-leasing/blog/electric...
While I'd love to believe this, am wary that the chart implies that the value of a base i-pace won't go down to £40k until its hit 60k miles, whereas there are 17k mile examples at this price today.The results suggest Tesla Model S and X depreciate less over 100k miles
https://www.vanarama.com/car-leasing/blog/electric...
That being said, I don't think I'm banking on mega low depreciation here, just don't want to get caught out if the values plummet (thanks to new tech/battery issues/something like that). I guess there is a multi billion pound industry here though, so I can see Jag/Merc/BMWs business model being reliant on cars like the i-pace retaining a decent amount of value over the coming years.
Gassing Station | EV and Alternative Fuels | Top of Page | What's New | My Stuff