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Comment by frumper | Hacker News Reader

Trading in your new car at 4 years old sounds like bad math no matter what car you buy.

Have you seen the prices of pre-owned Honda/Toyota sedans that are less than 5 years old? There are absolutely cars out there where trading in your new car after 3-4 years can make sense depending on the cost of the car, the depreciation curve, and whether you want to always be driving a relatively new car. Of course it's almost always going to be a better value proposition to drive the car for 10 years if you can, but that can still depend on depreciation.

The math doesn't work when you calculate the same thing based on buying low mileage used cars or leases.

You're throwing large amounts of equity away every 4 years.

Also electric cars get killed on the depreciation curve.

    > Also electric cars get killed on the depreciation curve.

I have heard this a couple of times now, and I believe it. Is the cause battery wear or pure demand (buyers don't want used EVs for various non technical reasons)?

In California, at one point, you could get a few thousand rebate, if you were in the Central Valley, and additional few thousand rebate. Some local cities gave rebates on top of that, and the federal tax rebate on that. Buy a $45k Model 3 and get back $13k-$15k just for buying it. Rebates like that are going to play havoc with resale values. On top of that, new Tesla's went down in price over the past several years. I think as these incentives taper off we'll see more of a stable drop off.

I think buyers just understand the value of a battery that they've cared for and babied compared to a battery with unknown history.

Low mileage used cars don't come with a warranty, or probably have a more limited warranty if they're CPO.

Leases can be better, but again they are usually better choices in high depreciation scenarios (like luxury vehicles or EVs, as you point out), not low depreciation scenarios.

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