A new study shows striking differences in the depreciation of ten popular electric and hybrid cars from their purchase price three years ago to their current value.
InsuretheGap.com found that the pure electric Renault Zoe lost the most value, depreciating by 61% in three years from its purchase price of £19,988 to only £7,830 value in 2019.
According to a 2019 Opinium survey, a third (33%) of UK drivers like to change their car at least every four years, making depreciation an important factor for cost-conscious drivers.
In a tie for second place are two electric cars, which both lost just over half their value (53%) since new in 2016, the Nissan Leaf and the BMW 330e (Electric/Hybrid). The Nissan Leaf lost £14,735 in three years, from £27,835 new in 2016, meaning it is now worth only £13,100. The BMW 330e (Electric/Hybrid) cost £33,800 new in 2016 and is now worth £15,900 at today’s prices.
The electric car that kept its value the best is the Volvo XC90 T8 (Electric/Hybrid), which lost just under a third (31%) of its value in three years, followed by the Mercedes-Benz C350e (Electric/Hybrid) and the Tesla Model S (Electric), which lost around 40%.
The remaining four cars surveyed all lost value roughly half their value: the Mitsubishi Outlander PHEV (Electric/Hybrid) depreciated by 45%; the Audi A3 e-tron (Electric/Hybrid) by 47%; the VW Golf GTE (Hybrid) by 48%; and the BMW i3 (i3 REX) (Electric) by 50%.
|Electric cars divide into three types; pure electrics which run off rechargeable batteries, hybrids powered by both petrol and batteries that recharge as you drive and plug-in hybrids, which charge up via a lead and drive on electricity or run with petrol or a mix of both.||Swansea hosted the UK’s first low carbon rally for electric powered cars at the weekend, the Green Dragon EV Rally & Show.|
As an incentive to combat the considerably higher costs of an electric vehicle, the government offer a grant via the Office of Low Emission Vehicles to cover 35% of the purchase price, up to a maximum of £3,500. Not all low-emission vehicles are eligible for the grant so cars must have CO2 emissions of less than 50g/km and have a zero-emission range of at least 70 miles.
“Electric cars are usually more expensive than their petrol equivalent, but their running costs are significantly cheaper,” said Ben Wooltorton, Chief Operating Office at InsuretheGap.com.
“For example, to fully charge the VW Golf GTE car’s 8.7kWh battery, which has a driving distance of 20 miles, costs around £1.04 at home (this is 5.2p per mile). Whereas, the petrol or diesel version would cost around £2.40 (or 12p per mile) to drive 20 miles.
“Electric cars are also usually exempt from vehicle tax. However, as with all investments it pays to know how well they will keep their value over time and electric cars are no different,” Wooltorton continued.
If a car is written off or stolen, insurers will usually only pay the market value of the car, not what was paid for it, so drivers could be facing a potential ‘gap’ in finances if they still have a loan to pay off.
A Guaranteed Asset Protection insurance policy from a specialist insurance provider like InsuretheGap protects drivers from this and tends to be significantly cheaper than those offered by car dealerships. InsuretheGap.com sells GAP policies from just £54.55. It covers ‘gaps’ up to £50,000.
Electric Car Data: InsuretheGap.com used Glass’s data to compile the survey and all valuations were based on average mileages.
2016 Price (New)
Order of depreciation
5d, Estate, 8 Speed
4d, Saloon, 7 Speed
4d Saloon, 1 speed
5d, 2.0, 1 Speed
5d, Hatchback, 6 Speed
5d Hatchback, 1 speed
5d, Hatchback, 1 Speed
5d Hatchback, 1 speed, 80kw
4d, Saloon, 8 Speed
5d Hatchback, 1 speed, 88bhp
Research was conducted online by Opinium research amongst 2,001 UK drivers between 22 – 28 January 2019.