Electric cars lose more value than petrol, diesel, or hybrid models in their first five years on the road, according to a new study from the USA.
A study of 1.1 million cars sold between November 2022 and October 2023 by iSeeCars revealed the average electric car depreciates by 49.1 per cent in the first five years on sale, compared to the market average of 38.8 per cent.
They depreciate less in 2023 than in 2019, however, with iSeeCars noting an 18 per cent improvement in their value retention.
“The disparity between electric vehicles and hybrids is worth noting, with EVs the worst group at holding their value and hybrids among the best,” said iSeeCars executive analyst Karl Brauer.
“Some manufacturers have reduced or even abandoned the hybrid market in favour of EVs, but these figures suggest consumers still appreciate a hybrid’s combination of higher fuel efficiency and zero range anxiety.”
The iSeeCars research follows comments from Toyota Australia vice president of sales and marketing Sean Hanley, who recently told Australian media electric car residuals are “plummeting” due to their higher purchase price.
Mr Hanley also pointed to brands providing big discounts on their electric cars due to big supply and cooling demand.
The Tesla Model 3 held its value best in the iSeeCars study, with an average five-year depreciation figure of 42.9 per cent. The Model X trailed it at 49.9 per cent, while the Tesla Model S had an average figure of 55.5 per cent.
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Porsche 911
According to iSeeCars, the Porsche 911 is the vehicle with the lowest five-year depreciation in the USA, followed by the Porsche 718 Cayman and Toyota Tacoma.
The Maserati Quattroporte and BMW 7 Series were the worst hit.
“Buyers looking to keep their vehicles for a long time shouldn’t be too worried about these depreciation rates,” said Mr Brauer.
“But if you’re rotating into a new vehicle every few years and those vehicles are luxury sedans or luxury SUVs, you’re losing a lot of money.”
