As the shift to electric vehicles looms, you may be pondering the fate of your current petrol car – should you sell it to embrace an electric alternative? Will an electric vehicle experience quicker depreciation?

Despite the perks like reduced road tax, it’s crucial to weigh the long-term implications, including the inevitable depreciation of EVs. Alternatively, if you’re contemplating selling your electric vehicle, it’s essential to understand how to secure the optimal price.

What contributes to EV depreciation?

Electric vehicles undergo similar depreciation factors as petrol or diesel cars, albeit with additional considerations due to their unique design. Yet, they benefit from being highly sough-after vehicles, especially with premium brands like Tesla dominating the EV market. 

Consequently, purchasing an EV could potentially yield a better return on investment compared to traditional models.

Factors contributing to electric car depreciation typically include high mileage, age, cosmetic condition both inside and out, service history, battery condition and age, as well as the type of electric vehicle (hybrid, fully electric, etc.).

Furthermore, electric cars are influenced by various incentives such as government grants, which can sway consumers towards buying new rather than used EVs, potentially diminishing the demand for pre-owned EVs.

However, it’s important to acknowledge that these incentives have evolved as electric car demand surged, suggesting that by 2035, there may be less hesitancy towards purchasing second-hand EVs.

How fast do EVs depreciate?

As per the AA, a new car typically depreciates around 60% within its initial three years, assuming an annual mileage of 10,000 miles. This reality isn’t surprising for most car owners, underscoring the importance of securing the best deal when selling your EV.

While EVs adhere to this standard depreciation pattern, they’ve shown remarkable resilience recently, benefiting from factors like ULEZ and popular brand trends, which help maintain their value over time.

Initially, when EVs gained traction, they struggled to retain their value due to limited demand for such a specialised vehicle. Models like the Peugeot iOn and Citroen C-Zero suffered notably in terms of residual value, released during a period of minimal public interest and scarce charging infrastructure.

However, the landscape has transformed since then, with the UK now boasting over 20,000 electric car charging points. Moreover, overall performance has improved significantly, with enhanced driving ranges per charge and quicker charging times. With the government aiming for widespread adoption of EVs by 2035, future demand is assured.

Is there correlation between brand and depreciation?

Certainly. The popularity of a brand influences its desirability, even as a pre-owned vehicle. This explains why EVs from brands like Tesla and Mercedes often defy the conventional 60% depreciation rule. Additionally, factors such as congestion zone regulations and low emission zones ensure sustained demand for EVs in specific regions, exemplified by Oxford’s recent implementation of a low emission zone.

Other aspects, like a brand’s overall customer appeal and its product offerings, also play crucial roles. For instance, Vauxhall, though not a luxury brand, effectively mitigates EV depreciation by providing an affordable, family-friendly option in the current UK market of EVs.

Tesla Model X

Undoubtedly, one of the world’s most sought-after brands, Tesla, boasts impressive performance in terms of electric car retail value. Take, for instance, the Tesla Model X, among the brand’s premium offerings, which is estimated to retain approximately 57% of its value after three years. Considering ongoing market trends, there’s ample justification to anticipate even greater returns for this vehicle, tailored to each potential buyer’s preferences.

Porsche Taycan

Merging from a distinguished premium brand, they Taycan demonstrates remarkable resilience by retaining 63% of its value over a three-year period, a noteworthy achievement compared to its counterparts. It’s important to recognise that with luxury brands like Porsche, potential buyers may be more selective. However, this underscores the importance of leveraging platforms like HeresACar, which connects sellers with over 1500 dealers, ensuring maximum exposure and competitive offers for your car.