Weird that this is presented as a problem for some reason.
They're objects that lose value when you use them. That's normal.
They're objects that lose value when you use them. That's normal.
A bar of gold will hold value a lot better than a car, but that doesn't mean a car is a worse purchase.
I think we can say that EV and ICE has nearly same utility, perks on either side. Faster refuelling vs. being able to do it at home.
Now next we can compare operational costs, what is the cost of fuel/electricity and maintenance. With home charging yes EVs are ahead.
But if we take into account Purchase price minus price you get when selling. Well EVs are often more expensive to start with. And then they depreciate more so you get less as an percentage from original purchase price.
Now it can very well be that you come lot of ahead in scenarios where you replace car with new one every 3 or 5 years with ICEs.
So total cost of ownership does matter. And big chunk of that is depreciation. Unless you are one of the few who buy new and then drive it to junk yard.
If in 5 years, your EV (that had similar utility as an ICE when you bought it) has lost so much value relative to a new EV, then the new EV must offer much more utility over both the old EV and the old ICE, in which case your ICE should have lost a similar amount of value.
I.e, I've only bought cars that are 10+ years (exactly due to the depreciation factor!), but most other people buy or lease as new of a car as they possibly can afford. Doesn't make financial sense to me, yet it's done so very often.
Not sure why this would be hard to understand.
If the value of your EV has dropped to $10k and you get paid out that much for an accident, then in theory you should be able to buy a similar condition EV on the used car market for $10k. What's the problem with that?
If you're trying to get people to switch en masse to EVs, it's not good for everyone to be in perpetual "ehh there's gonna be way better ones around the corner" mode.
> If the value of your EV has dropped to $10k and you get paid out that much for an accident, then in theory you should be able to buy a similar condition EV on the used car market for $10k. What's the problem with that?
The problem is when your loan balance is $20K and you're only getting a $10K payoff...
People make irrational decisions. That's a fact.
People "should" do things they don't. That's a fact.
The question is not, "What would a logically-driven being do?", but "What are people doing?"
That can happen with a conventional car as well, which is why gap insurance exists. The regular insurance should still give you the replacement price (which would be the depreciated value).
https://docs.google.com/spreadsheets/u/0/d/1F5IQOynIawoXiJPV...
It does not seem remarkable that a new product takes some time to find its market price, and COGS goes down as supply chain improvements are made.
And there was a $7,500 tax credit at time of purchase introduced in Jan 2023. At least the graph comparing Model Y to Ford F150 seems expected.
But hey, that just means better used EV prices for the rest of us. You can get some high end gently used ones for a great price.
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“ For Tesla owners in the U.S., their 2023 Model Ys are worth 42% less than what they paid two years ago, while a Ford F-150 truck bought the same year depreciated just 20%. Older EV models depreciate even faster than newer ones. ”
Why buy a car that depreciates hella fast?
It says that it deprecates faster than other type of cars which should be worse in this particular criteria
They're objects that disintegrate in the atmosphere at some point when you use them. That's normal, it even has a name: rapid unscheduled disassembly.