Electric vehicle (EV) owners are waking up the nightmare of steep depreciation. New trade-in estimates indicate that the value of many sought-after models has plummeted. Recent data indicates that certain EV makes and models depreciate at rates of up to 50% just in their first year. This potentially steep drop is extremely troubling news for current and future owners alike.
One example of this is a 2024 all-wheel drive (AWD) model that was bought at $100,000. Despite only having 19,623 miles on the vehicle, their trade-in offer was $63,100, meaning that they lost a significant 37% in depreciation. This shocking number conveys the drastic depreciation rate that many EVs go through just weeks after being bought.
Just three months ago, a high-end Cyberbeast model fetched $127,000 at auction. Today, it has sharply depreciated in worth on the market. We got a quote of $78,200 after only eight months of ownership on the Cyberbeast. That’s a depreciation rate of about 38%, highlighting the continued trend of quick value loss in the EV marketplace.
Trade-in values are almost always less than owners would receive from private-party sales. Even with these updates, these numbers are still a wake-up call for consumers thinking about making an investment in an EV. The fast-paced depreciation is a critical factor that potential buyers should weigh when evaluating their options in the EV segment.
Economists highlight a few reasons that explain why EVs are losing value so quickly. These factors are technology and market demand. Newer models with even better technology and further ranges are perpetually arriving on the scene. Consequently, older models tend to have a harder time holding their value.
The ramifications of this trend are huge. That’s true for both manufacturers and consumers. For automakers themselves, high rates of depreciation are damaging to brand image and long-term customer loyalty. For consumers, knowing the depreciation landscape is key to ensure they purchase a new vehicle at the right price.
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