Taking the Dive

[PHEV Newbie]

According to the principles of economics, your Clarity is worth less than the overall cost that a savvy buyer can get a new one for. Factoring in the federal, state incentives and my dealer discount, I paid about $27000 before tax and registration. There was a poster who said he got a $3000 discount, which is completely believable since my local dealer has only sold one Clarity so far (mine last Dec) with the remaining ones in his lot languishing for months. Thus, I would be shocked if anyone would pay me more than $26000 for my 3 month old Clarity Touring. That being said, starting at my actual price point of $27000, it should hold it's resale value pretty well compared to other cars where someone actually paid a full $37000 before tax/reg.

Of course, all this changes if the incentives go away.

 

[LAF]

Way off, what do you base those numbers on?
A 2 year old Prius Hybrid private sale averages 26K+ so you are also saying that the Clarity with a 7K greater MSRP, more seating and more features + it is a plug-in is worth less than a 2 year old Prius?

You are also saying the depreciation at 5-6 years is only slightly less than the first 2 if you considering a sale in Ontario.
A BC Clarity might be worth more due to rebates.

We all know new cars depreciate faster than used cars and the cheapest way to go is generally to keep you car and run it into the ground.
Anyone selling their car after 2 years know they are paying the greatest depreciation years.

Even if you "only get 26k for a 2 year old Clarity- with rebates that is all it costs in the first place!!!!

 

[LAF]

According to the principles of economics, your Clarity is worth less than the overall cost that a savvy buyer can get a new one for. Factoring in the federal, state incentives and my dealer discount, I paid about $27000 before tax and registration. There was a poster who said he got a $3000 discount, which is completely believable since my local dealer has only sold one Clarity so far (mine last Dec) with the remaining ones in his lot languishing for months. Thus, I would be shocked if anyone would pay me more than $26000 for my 3 month old Clarity Touring. That being said, starting at my actual price point of $27000, it should hold it's resale value pretty well compared to other cars where someone actually paid a full $37000 before tax/reg.

Of course, all this changes if the incentives go away.

but the rebates will eventually go away!!

 

[Viking79]

I can get a 3 year old $55k BMW i3 REx with less than 20k miles for around $20k. I wouldn't expect a lot from Clarity resale if you look at MSRP.

e.g., if someone made a deal of $3k off MSRP, $7500 federal credit, maybe $3k in state, that is $13,500 off MSRP, so the actual new price was closer to $24,000 for a touring, I would base resale on that value. So my hunch is after a year the Clarity will be worth around $25,000 or less, with a more reasonable drop from there. Since people can buy them new for that.

A change in tax credits could cause this to adjust accordingly, as well as demand for EVs. My Volt seems to have stabilized a bit after dropping dramatically initially. I think there is a larger market for a used around $10k EV, so it hasn't changed in value much over last year or two.

As long as you can lease a new electric car for payments similar to a $20k new car, you are going to see low resale on these.

 

[loomis2]

All this talk of state incentives is making me jealous. I'm stuck in a state like Ohio with no state incentives. Does that mean my Clarity is worth $3000 more since I paid $3000 more? That's how it works, right?

 

[prestoOne]

According to the principles of economics, your Clarity is worth less than the overall cost that a savvy buyer can get a new one for. Factoring in the federal, state incentives and my dealer discount, I paid about $27000 before tax and registration. There was a poster who said he got a $3000 discount, which is completely believable since my local dealer has only sold one Clarity so far (mine last Dec) with the remaining ones in his lot languishing for months. Thus, I would be shocked if anyone would pay me more than $26000 for my 3 month old Clarity Touring. That being said, starting at my actual price point of $27000, it should hold it's resale value pretty well compared to other cars where someone actually paid a full $37000 before tax/reg.

Of course, all this changes if the incentives go away.

I am talking CDN dollar, you the US dollar.
Also the rebates are all over the place. I read in the states it is 13.5K US rebate. In Ontario it is only $13K CDN.
I also noticed our MSRP is less than what it is in the states. 33K US = 42.5K CDN. No wonder people are able to get 3K off in the US.

Still see your numbers as way off when it comes to the depreciation.....if you are taking US dollars then $25K is too much. The market value of the car new is MSRP - rebates. The depreciation in years 3-6 will be less than the first 3.

Rebates, hard to say what the future is. More models will appeal to more people so the rebate should drop but that is a few years off still I think.

 

[bpratt]

One thing that may really cause the resale value of the 2018 Clarity to drop is lithium ion battery research. Elon Musk once said he would like to develop a 1200 pound lithium ion battery pack that would propel a car 1000 miles, would charge to 80% in 10 to 15 minutes, would last 20 years, would not burn in case of a puncher and would be reasonably priced to manufacture. If anyone can do that in the next few years, our car resale value will really drop.

 

[JyChevyVolt]

47 mile EV range will be hard to top within 5 years.

6.6kW on board charger will be hard to top in 5 years.

You driving pattern is similar to my wife. She is doing fine with the electric version.

 

[jdonalds]

New battery technologies are emerging. One example is SCiB by Toshiba which boasts 6 minute charge times for 200 miles of range. https://futurism.com/a-new-electric-car-battery-lasts-for-200-miles-and-charges-in-just-6-minutes/

Another is shown in the Toyota announcement of Solid State LiOn with 7 minute charge times.

If a method can be found for high volume low cost production of graphene it will not only impact car batteries but many other things as well.

I believe we will begin to see a few cars hit the market with very fast charge times in about two years, and be available in production quantities in 3 to 4 years.

https://www.pocket-lint.com/gadgets...in-seconds-last-months-and-power-over-the-air

VW (if you can believe anything they say) is promising fast recharge long lasting cars in two years.

Fast recharge is the key to electrification. It is the holy grail of the transition away from the ICE.

 

[prestoOne]

-If such technology does come along it would mean gas cars are 100% dead as long as the electrical infrastructure is there. It isn't there and won't be, talk about a man made energy crisis.
-The current cars may be able to be retrofitted....I doubt it usually customers get abandoned.
-Rarely does this stuff get delivered on in a timely fashion.

I don't know what the future holds. I hope it is good even if I take a hit on depreciation.

 

[jdonalds]

I'm waiting for a major sign which is when gas stations start having charging stations.

Has anyone seen one yet?

 

[bpratt]

If such technology does come along it would mean gas cars are 100% dead as long as the electrical infrastructure is there. It isn't there and won't be, talk about a man made energy crisis.

I'm not sure I agree with the statement about the electrical infrastructure not being there because there is a lot of unused electricity between the hours of 10 pm and 6 am. The current plug in and electric vehicles already have a timer that will control when your car gets charged.

 

[prestoOne]

I'm waiting for a major sign which is when gas stations start having charging stations.
Has anyone seen one yet?

How are they going to have space to keep cars for 2 houea

I'm not sure I agree with the statement about the electrical infrastructure not being there because there is a lot of unused electricity between the hours of 10 pm and 6 am. The current plug in and electric vehicles already have a timer that will control when your car gets charged.

Three things come to mind.
1) For the night time thing: what happens now when every household turns on an A/C unit? There are more cars than A/C units and cars use up more juice than A/C units.
2) Where I live the government can't even roll out 240V stations at a reasonable rate. Never mind the high current/voltage required for those super fast fill ups.
3) During the day people will want to charge up on a regular basis. People generally don't have the foresight to charge up at night. Many do but many don't.

I don't know which is right so this is just idle jabbering.

 

[MarkClarity]

Charging does exist at a gas station, but still very rare unless you are in Norway.

 

[K8QM]

Most utilities would definitely have trouble if by some magic a huge number of BEVs and PHEVs suddenly appeared overnight all demanding to be charged. Even as it is many utilities in the South struggle on the hottest Summer days from 4-7PM when everyone gets home and cranks down the AC, starts cooking dinner and watching TV. If you suddenly added thousands of cars drawing hundreds of thousands of kilowatts it would be a problem more often than it is.

The power companies are really good at predicting peaks each month so that they can shuffle power between regions based on who needs it at that time, fire up their (expensive) peaking infrastructure and load manage industrial customers who then use their own (expensive) generation during the peak. My guess is that time of use rate will come back into vogue for residential customers so we can benefit from waiting to charge our vehicles during the overnight hours.

One possibility that I foresee is that there will be a lot of solar charging done in parking lots during the day - even if you can't get a full charge it would still be worth it to use that wasted space and time with the added bonus of giving you covered parking spaces.

Whatever happens it's going to be interesting.

geo

PS My wife who has worked in the electric industry for 30 years said I didn't say anything too far off base in this message.

 

[loomis2]

One thing that may really cause the resale value of the 2018 Clarity to drop is lithium ion battery research. Elon Musk once said he would like to develop a 1200 pound lithium ion battery pack that would propel a car 1000 miles, would charge to 80% in 10 to 15 minutes, would last 20 years, would not burn in case of a puncher and would be reasonably priced to manufacture. If anyone can do that in the next few years, our car resale value will really drop.

If this happens I will gladly have my resale drop.

 

[Atul Thakkar]

In Canada we have different rate depending upon time of use. One utility company recently announced that even new time slot at further reduce rate. From midnight to 5am

 

[BillInArkansas]

What an interesting set of posts! When my son went away to one of those crazy liberal east coast colleges (15 years ago), he came back and said I should throw away all my incandescent bulbs and replace them with fluorescent not because they would pay for themselves, but because it was the “right” thing to do for the environment. His words were, “It doesn’t have to pay for itself if you can afford it.” I doubt that my city’s recycling pays for itself, but I collect recyclables. Based on my son’s argument, my last 3 cars have been PHEV’s. Had I bought a Cruze rather than a Volt, my total cost of ownership would likely have been lower because the sticker (after rebates) would have been much lower, the resale possibly higher, and the difference between 35 mpg and 110 mpg isn’t that many real dollars if you only drive 10,000 miles per year. When I bought the Clarity, I didn’t even look at the Accord to try to figure out if the difference made economic sense. I could afford it and chose to buy it (I gave my Volt to my daughter-in-law who loves it). Using less gas is the right thing to do, I love my Clarity. Note that when someone tells me they are an environmentalist and they don’t drive an electric vehicle, I think of them the same way I think of church members who think Jesus would support building a border wall....

 

[marshall]

One possibility that I foresee is that there will be a lot of solar charging done in parking lots during the day - even if you can't get a full charge it would still be worth it to use that wasted space and time with the added bonus of giving you covered parking spaces.

California has an excess amount of energy during 8am to about 4pm in the spring, due to solar energy installations. As such, the local utilities need to use this excess. Part of the solution is to install car charging equipment and the have electric cars charge during the work day.

 

[KentuckyKen]

What an interesting set of posts! When my son went away to one of those crazy liberal east coast colleges (15 years ago), he came back and said I should throw away all my incandescent bulbs and replace them with fluorescent not because they would pay for themselves, but because it was the “right” thing to do for the environment. His words were, “It doesn’t have to pay for itself if you can afford it.” I doubt that my city’s recycling pays for itself, but I collect recyclables. Based on my son’s argument, my last 3 cars have been PHEV’s. Had I bought a Cruze rather than a Volt, my total cost of ownership would likely have been lower because the sticker (after rebates) would have been much lower, the resale possibly higher, and the difference between 35 mpg and 110 mpg isn’t that many real dollars if you only drive 10,000 miles per year. When I bought the Clarity, I didn’t even look at the Accord to try to figure out if the difference made economic sense. I could afford it and chose to buy it (I gave my Volt to my daughter-in-law who loves it). Using less gas is the right thing to do, I love my Clarity. Note that when someone tells me they are an environmentalist and they don’t drive an electric vehicle, I think of them the same way I think of church members who think Jesus would support building a border wall....

Bill, I can wholeheartedly agree with your economics and environmentalism, but I think your theology needs some work. Just saying...