EV Resale Projector

1. Depreciation Curves (EV vs. ICE)

Historically, EVs have depreciated faster than their Internal Combustion Engine (ICE) counterparts. This is due to rapidly evolving technology, battery degradation concerns, and changing government incentives. Our model uses distinct curves for different vehicle types, showing that while a standard sedan might retain 62% of its value after 5 years, an early-generation EV could retain less than 40%.

2. Key Factors & Price War Impacts

Battery Degradation: The single largest driver of EV depreciation is battery health. While not linear, batteries lose capacity over time and with charge cycles. Our model includes a general adjustment for this, but real-world degradation depends heavily on charging habits (fast vs. slow charging) and climate.

Price Wars: Recent and aggressive price cuts by manufacturers like Tesla have a direct and immediate impact on the resale value of existing cars. When a new Model 3 is suddenly $5,000 cheaper, the value of all used Model 3s drops overnight. Our curves are based on post-price-war data, reflecting this "new normal" of higher EV depreciation.

The mileage adjustment further refines the estimate, applying a penalty for vehicles driven more than the typical 10,000-12,000 miles per year, as higher mileage generally correlates with increased wear and lower battery health.