Jump to content
  • William Maley
    William Maley

    Most Electric Cars Sold in the U.S. Are Leased

      There's a good reason why EV buyers are leasing

    You find yourself in the showroom, ready to drive away in a new Chevrolet Bolt, Nissan Leaf, or Tesla Model S. But there is one big question that needs to be decided, do you buy or lease it? According to a report from Bloomberg, most buyers of EVs tend to lease.

    In the U.S., almost 80 percent of electric vehicles on the road are leased according to their report. It also says that 55 percent of plug-in hybrids are leased. More than 80 percent of BMW i3s are leased as an example. The key reason comes down to the belief that electric vehicles will continue to improve and buyers can simply trade them - similar to purchasing a new smartphone.

    "When there’s new technology coming out, and it’s coming out so rapidly, and you’re improving on it so constantly, typically people only want to lease it,” said Steve Center, a vice president of American Honda Motor Co., back in April.

    This bet seems to be paying off as the range of electric vehicles has been increasing, while prices of batteries have been going downward.

    “If you look at what can happen across the lifetime of a lease, you’re really talking about doubling the range of these vehicles,” said Edmunds analyst Jeremy Acevedo.

    The imbalance between leasing/buying an electric vehicle has also made used EVs to become a steal. According to auto analytics firm Black Book, compact electric vehicles sold in 2014 only hold 23 percent of their original sale price. A comparable internal combustion vehicle holds about 41 percent. Doing a quick search on Cars.com, we were able to find low mileage 2015 Nissan Leafs ranging $14,000 to $16,000.

    The big question is will this trend continue down the road, considering the likes the Model 3 and models coming from German automakers.

    Source: Bloomberg

    • Upvote 1


    User Feedback

    Recommended Comments



    Awesome write up and I agree, eight now as much as I like the EV auto's, lease is the way to go as we are changing tech way to fast to buy.

    Share this comment


    Link to comment
    Share on other sites

    A gently used, certified pre-owned Bolt would be a steal for someone shopping the segment. 

    That said, I think part of it also has to do with the way the tax credit is structured.  If you lease, you get the full credit vis-a-vie the leasing company.  If you buy, then you have to deal with submitting for the tax credit and possibly not being eligible for the full amount.   I'm certain that is an aspect for leasing as well. 

    • Upvote 3

    Share this comment


    Link to comment
    Share on other sites
    51 minutes ago, Drew Dowdell said:

    A gently used, certified pre-owned Bolt would be a steal for someone shopping the segment. 

    That said, I think part of it also has to do with the way the tax credit is structured.  If you lease, you get the full credit vis-a-vie the leasing company.  If you buy, then you have to deal with submitting for the tax credit and possibly not being eligible for the full amount.   I'm certain that is an aspect for leasing as well. 

    I never knew that on leasing. 

    Share this comment


    Link to comment
    Share on other sites

    From a different perspective, electric vehicles, per the article, can be seen as throwaways.  First off they're leased, then dumped into a market where they have no value.  From a financial point of view, they are a much worse investment than conventional vehicles, which can effortlessly be kept in service by subsequent owners, this adds intrinsic value that is impossible to deny.

    • Thanks 1

    Share this comment


    Link to comment
    Share on other sites
    1 minute ago, ocnblu said:

    From a different perspective, electric vehicles, per the article, can be seen as throwaways.  First off they're leased, then dumped into a market where they have no value.  From a financial point of view, they are a much worse investment than conventional vehicles, which can effortlessly be kept in service by subsequent owners, this adds intrinsic value that is impossible to deny.

    Effortlessly? I beg to differ. It's going to take me hours of effort to replace the starter in my CRV.

    Share this comment


    Link to comment
    Share on other sites
    1 hour ago, ocnblu said:

    From a different perspective, electric vehicles, per the article, can be seen as throwaways.  First off they're leased, then dumped into a market where they have no value.  From a financial point of view, they are a much worse investment than conventional vehicles, which can effortlessly be kept in service by subsequent owners, this adds intrinsic value that is impossible to deny.

    Wrong, EV leasing offers all auto companies a way to off set profits which in the end means having to pay the tax man. Much value to the bottom line.

    In regards to Effortlessly be kept in service, stop dreaming silly, Petro auto's often cause hours of wrench time to repair and keep running.

    Share this comment


    Link to comment
    Share on other sites

    I just realized something yuge and even more precarious for the industry we all love.  The electric car mentality is the very same as the cell phone mentality.  Now let me ask you, good citizens, is this really what you want?  To Apple-ize cars?  Are we going to camp out and wait for the release of v.2, v.3 of a CAR?  The implications blow my tiny little mind.

    • Thanks 1

    Share this comment


    Link to comment
    Share on other sites
    2 hours ago, ocnblu said:

    I just realized something yuge and even more precarious for the industry we all love.  The electric car mentality is the very same as the cell phone mentality.  Now let me ask you, good citizens, is this really what you want?  To Apple-ize cars?  Are we going to camp out and wait for the release of v.2, v.3 of a CAR?  The implications blow my tiny little mind.

    I think for people who don't care, car sharing, car subscriptions, and various schemes like that will increase. They'll take the place of the CamCordTima crowd.  For the people who do care, there will still be the niche products out there. 

    • Upvote 1

    Share this comment


    Link to comment
    Share on other sites

    I've had some interesting observations over the last couple years when i was looking at used Volts.

    About 18-24 months ago when there was a bunch of lease return Volts, 3 years old etc.... they were getting really cheap in some cases because so many were coming off their lease returns.  The used 2013 with 36,000 miles on the market in mid 2016 was sometimes had for 13,000-14,000.  Here at week one of 2018, if i look at used 2013 Volts and some of them do still have 36,000 miles they are actually going for more money (15 grand plus) for the same car, now 18 months older.

    Leasing electric cars will perpetuate drops in used retail prices but if you time it well and buy one of those 3 year pre owned, I think you will get it for a fair price and after you buy it I don't think you will lose a lot more on depreciation.  I think that will be the sweet spot for ownership on an electric car.

    For leasing new, the problem is california customers will get more incentives offered to them than other parts of the country.  On Volt fourms and places like leasehckr you see many examples where between the extra tax credits and special localized incentives, things like Volts and Bolts can sometimes be had for little down and absurd monthlies.  Like 250 a month zero down and then no gas bill.  Spark EV's towards the end were going close to zero down and 100 a month for places in CA.  Foolish not take advantage of leasing when its like that.

    Edited by regfootball
    • Like 2

    Share this comment


    Link to comment
    Share on other sites

    I'll add, Spark EV's used....good buy, as low as 8-9 grand and 30-40k miles in some instances,  just they are only in certain parts of the country to be found.  not bad for 327 lb ft of torque....

    Edited by regfootball

    Share this comment


    Link to comment
    Share on other sites

    So, riddle me this, what happens when the batteries die and there's no warranty, how much would that all cost to fix?

    Share this comment


    Link to comment
    Share on other sites
    16 hours ago, Zane Wylder said:

    So, riddle me this, what happens when the batteries die and there's no warranty, how much would that all cost to fix?

    With the hybrid Prius and Ford Escapes that hasn't been an issue, the batteries typically outlast the car. Prius and Escape taxis go multiple hundreds of thousands of miles on their original batteries.

    • Upvote 1

    Share this comment


    Link to comment
    Share on other sites
    8 minutes ago, Drew Dowdell said:

    With the hybrid Prius and Ford Escapes that hasn't been an issue, the batteries typically outlast the car. Prius and Escape taxis go multiple hundreds of thousands of miles on their original batteries.

    True, and from now on, I'll tone down my comments, but I digress

     

    So when the time comes then, how much is the repair?

    Share this comment


    Link to comment
    Share on other sites

    I wouldn't want one out of warranty...I'd get the extended warranty w/ any modern vehicle and trade before it expires.  With an EV, a lease really makes the most sense...

    Edited by Cubical-aka-Moltar

    Share this comment


    Link to comment
    Share on other sites
    Just now, Zane Wylder said:

    True, and from now on, I'll tone down my comments, but I digress

     

    So when the time comes then, how much is the repair?

    It varies depending on the kilowatt hour of the battery and the type of the battery. I've seen as low as $1,500 for a Prius and $14,000 for a Tesla. The Tesla can be $120,000 car though.

    Share this comment


    Link to comment
    Share on other sites

    Ford, Toyota, GM, and Tesla all had battery buyback programs at one point where you get a trade in value for your old battery. I haven't heard anything in a while so I don't know if they're still active or not.

    Share this comment


    Link to comment
    Share on other sites
    21 hours ago, Zane Wylder said:

    True, and from now on, I'll tone down my comments, but I digress

     

    So when the time comes then, how much is the repair?

    We have reduced the costs of EV battery packs 80% in the last 6 years. As we get more efficient with production as well as recycling and move to solid state batteries, as Hybrid / EV auto's increase in production and sales, prices always come down.

    screen-shot-2015-03-23-at-142210_600x365

    This chart is just one showing where our costs are and how we have already beat 2020 cost projections.

    https://cleantechnica.com/2015/03/26/ev-battery-costs-already-probably-cheaper-than-2020-projections/

    Plenty more info in the story above, but you can bing or google your own "yearly auto battery price reductions for EVs" and see that there is plenty of evidence that shows the cost of a replacement battery is always reducing. By the time you have 250,000 miles or more on the auto, it will be much cheaper for a much superior battery pack or you might not even own the auto any more.

    The low maintenance cost of Hybrid and EV auto's beats ICE auto's and as we learned about lead paint, asbestos, diesel and so many other polluting toxic things, we are learning how to create much better products.

    This all helps with other pollution issue especially in the inner big cities in regards to noise pollution, exhaust pollution, etc. Cleaner, quiet, better.

    21 hours ago, Drew Dowdell said:

    Ford, Toyota, GM, and Tesla all had battery buyback programs at one point where you get a trade in value for your old battery. I haven't heard anything in a while so I don't know if they're still active or not.

    Tesla, GM and Toyota along with BMW have all canceled their buy back programs as they have focused on using the warranty replaced batteries in power storage packs available to the public and businesses for solar storage systems. Ford I could not find anything on now.

    Yet with the much higher dependable packs, I think the cost of recycling or dealing with disposal is what has led to the ending of that program it seems.

    Share this comment


    Link to comment
    Share on other sites

    There is no place to plug in a golf cart in the city, which is ironic because electrics are only good as short hop toys, not long distance cruisers.  This is a big country. 

    • Like 2
    • Haha 1

    Share this comment


    Link to comment
    Share on other sites



    Join the conversation

    You can post now and register later. If you have an account, sign in now to post with your account.
    Note: Your post will require moderator approval before it will be visible.

    Guest
    Add a comment...

    ×   Pasted as rich text.   Paste as plain text instead

      Only 75 emoji are allowed.

    ×   Your link has been automatically embedded.   Display as a link instead

    ×   Your previous content has been restored.   Clear editor

    ×   You cannot paste images directly. Upload or insert images from URL.




  • Similar Content

    • By Drew Dowdell
      As we wrote late last month, the Jaguar XJ is about to use up one of its nine lives. The big cat gets euthanized next month without a direct replacement ready for market.  However, we also told you that the cat will be back, possibly as an electric vehicle next time.  At an investor meeting Jaguar confirmed that to be true.
      Jaguar is working on a new Modular Longitudinal Architecture (MLA) platform for use under the next XJ and for the next Range Rover.  The flexible platform is capable of being used in electric, plug-in hybrid, or mild-hybrid configurations.  It is also being designed to be very light weight, eventually to be used to replace all five of the platforms that Jaguar Land Rover uses.  Jaguar Land Rover hopes to increase profits by reducing the number of architectures.  Jaguar does plan to continue to develop the I-Pace platform which is unrelated to MLA.
      The XJ's direct replacement will launch first as a electric model with a predicted range of 292 miles using a 90.2 kWh battery. Later, 6-cylinder models (likely the new inline-6 recently shown in Range Rover) will become available.  The 292 mile range in the XJ would rival the Tesla Model S and Porsche Taycan.
      For those who prefer a plug-in hybrid, the MLA platform will use a 13.1 kWh battery giving an estimated EV range of about 31 miles. Mild-Hybrid versions get a belt-alternator-starter setup to give a small electric boost at start.
      Also on the MLA platform will be the Range Rover and Range Rover Sport. Both names currently offer plug-in hybrid versions, but the new MLA platform could enable the Range Rover to be available in an all electric version.  Land Rover has not yet confirmed this to be the case.   The Range Rover would come first with the Sport following close behind in 2021.
      All of this comes in the background of huge job cuts at Jaguar after a record $4.6 billion loss.
    • By Drew Dowdell
      As we wrote late last month, the Jaguar XJ is about to use up one of its nine lives. The big cat gets euthanized next month without a direct replacement ready for market.  However, we also told you that the cat will be back, possibly as an electric vehicle next time.  At an investor meeting Jaguar confirmed that to be true.
      Jaguar is working on a new Modular Longitudinal Architecture (MLA) platform for use under the next XJ and for the next Range Rover.  The flexible platform is capable of being used in electric, plug-in hybrid, or mild-hybrid configurations.  It is also being designed to be very light weight, eventually to be used to replace all five of the platforms that Jaguar Land Rover uses.  Jaguar Land Rover hopes to increase profits by reducing the number of architectures.  Jaguar does plan to continue to develop the I-Pace platform which is unrelated to MLA.
      The XJ's direct replacement will launch first as a electric model with a predicted range of 292 miles using a 90.2 kWh battery. Later, 6-cylinder models (likely the new inline-6 recently shown in Range Rover) will become available.  The 292 mile range in the XJ would rival the Tesla Model S and Porsche Taycan.
      For those who prefer a plug-in hybrid, the MLA platform will use a 13.1 kWh battery giving an estimated EV range of about 31 miles. Mild-Hybrid versions get a belt-alternator-starter setup to give a small electric boost at start.
      Also on the MLA platform will be the Range Rover and Range Rover Sport. Both names currently offer plug-in hybrid versions, but the new MLA platform could enable the Range Rover to be available in an all electric version.  Land Rover has not yet confirmed this to be the case.   The Range Rover would come first with the Sport following close behind in 2021.
      All of this comes in the background of huge job cuts at Jaguar after a record $4.6 billion loss.

      View full article
    • By Drew Dowdell
      General Motors and Bechtel are teaming up to form a new company to deploy a widespread fast-charging network. Neither company plans to put any money into the project, outside investors are being solicited.  The network will help General Motors, which plans to introduce 20 new EVs by 2023.  It will also help other manufacturers of EVs. 
      General Motors will provide data to help decide where to locate the EV charging stations and Bechtel will use its own experts for the engineering and building of the stations. Much of the data will come from GM's OnStar system to help learn where people tend to park.  Data from both electric and gasoline powered vehicles will be used.
      Additional fast-charging infrastructure is seen as a requirement to increasing electric vehicle sales. According to a survey by AAA, one of the biggest concerns Americans have about EVs is having enough locations to charge them.  
      The network built by Bechtel and GM will not be limited to interstate highways where most fast charging stations have been located so far.  The company will also locate chargers in urban areas targeting apartments and condos where drivers cannot have a home charger of their own. 
      The new venture joins major initiatives from Electrify America, a Volkswagen funded EV station program, and Tesla with Supercharging, to build out a nationwide network of charging stations. 

      View full article
    • By Drew Dowdell
      General Motors and Bechtel are teaming up to form a new company to deploy a widespread fast-charging network. Neither company plans to put any money into the project, outside investors are being solicited.  The network will help General Motors, which plans to introduce 20 new EVs by 2023.  It will also help other manufacturers of EVs. 
      General Motors will provide data to help decide where to locate the EV charging stations and Bechtel will use its own experts for the engineering and building of the stations. Much of the data will come from GM's OnStar system to help learn where people tend to park.  Data from both electric and gasoline powered vehicles will be used.
      Additional fast-charging infrastructure is seen as a requirement to increasing electric vehicle sales. According to a survey by AAA, one of the biggest concerns Americans have about EVs is having enough locations to charge them.  
      The network built by Bechtel and GM will not be limited to interstate highways where most fast charging stations have been located so far.  The company will also locate chargers in urban areas targeting apartments and condos where drivers cannot have a home charger of their own. 
      The new venture joins major initiatives from Electrify America, a Volkswagen funded EV station program, and Tesla with Supercharging, to build out a nationwide network of charging stations. 
  • Social Stream

  • Today's Birthdays

    1. noah vamosy
      noah vamosy
      (19 years old)
    2. pontiaccrest
      pontiaccrest
      (65 years old)
  • Who's Online (See full list)

  • My Clubs

About us

CheersandGears.com - Founded 2001

We ♥ Cars

Get in touch

Follow us

Recent tweets

facebook

×
×
  • Create New...