EV Depreciation 2023

tobefrank321

https://www.boards.ie/discussion/comment/121525184#Comment_121525184

This is not about me. I'm sorry you can't understand that but its your problem, not mine. And I'm not inclined to help you with it.

Its head in the sand stuff if you can't understand why EVs are struggling to become mainstream.

Price is one factor. There's a myriad of others. Converting to EVs is not as simple as converting to a cashless society for example. Its far more complex, both for society and for the range of people involved.

Fast chargers are a long way from being as common as your normal petrol/deisel service station. Every small town in Ireland has a traditional service station. How many have fast chargers?

Range anxiety is still a factor. Price also. Up front costs. Different apps for different chargers.

Good luck to the early adoptors etc. So far they are in the minority and a large proportion of the population are struggling to get on board for many of the reasons mentioned.

And having a go at people who can't or won't get on board is not helpful.

FaaF

https://www.boards.ie/discussion/comment/121525219#Comment_121525219

They're a competitive choice for those who might have went for a traditional brand instead because they don't like the minimalist look of the Tesla's interior, for example. Basically, we now have two brands to choose from instead of one should we decide that we don't want to pay the exorbitant prices that traditional manufacturers have been charging for years.

Apparently, there are 340 BYD Seals in Ireland due for delivery in the coming weeks. They have also, just this month, completed the inaugural sailing of their own vessel that's capable of carrying 7000 vehicles, effectively cutting out the middleman in transport. Apparently, they plan to have 6-8 of these. I believe they're in the early phase of a significant ramp-up of production and shipping capacity and may have just decided it's pointless to undercut pricing at this point, where they'll be able to sell all they can manufacture and ship by simply 'slotting in at the current price range'.

Cyrus

https://www.boards.ie/discussion/comment/121525255#Comment_121525255

you are inventing problems that don't exist for a lot of people though,

the whole public charger, apps thing is not a factor for most owners. I charge at home and use ionity if i need public charging. Over 4 years of EV ownership that has worked fine.

ICE cars are expensive too, its not an EV only thing.

FaaF

https://www.boards.ie/discussion/comment/121525242#Comment_121525242

But business 101 is that if costs drop significantly and selling prices don't, profit margins increase significantly. Where a business sector remains very high margin, more and more entrants come along until competition increases and margins drop. I'm sure Tesla have upper management that are looking at current, and projected, new entrants and considering whether price cuts are needed to deter further entrants.

Of course, this must be weighed against manufacturing capacity too - as there's no point cutting prices by 30% after a 30% drop in costs if cutting by 5% will result in you selling everything you can produce.

So, assuming the lithium prices don't skyrocket in 2024, which is a big assumption I know, 2024 will see either price drops or the entry of new, yet unheard of, manufacturers.

Another variable is hedging. It's highly unlikely that any EV manufacturer hasn't hedged for lithium prices but I don't know to what extent each does - do they buy lithium in the futures market for the next 6/12/18 months? This will determine how much of this years 80% lithium price drop they're able to apply to vehicles currently being manufactured (and, more so, the rapid 40% lithium price drop in the last 3 months).

There will be traditional manufacturers that are using the traditional strategy of "we spent €X billion on EV research and development so we'll add €XX,XXX to the cost of each new EV to recoup this". Some of these are likely to find that recouping that R&D cost in this way is not possible due to the competition. The bulk of it may just need written off.

traco

https://www.boards.ie/discussion/comment/121525271#Comment_121525271

To be fair tobefrank the payment at public chargers is very poor. Should be a simple tap or insert card an PIN.

The app and mutiple accounts is very poor. I've used Ionity twice and both times had issues even with the app and a pre-approved card it would not start but would with google pay. It was lucky that I was with Mrs Traco as that would not have been a good situation. Fotrunately as its a Tesla the 3rd party ones are rarely needed and the supercharging is as simplae as at home. All the other fobs and apps though is BS as far as I am concerned,

joe1303l

https://www.boards.ie/discussion/comment/121525177#Comment_121525177

I don’t think the Germans are joining the party. VW price cuts are only on existing stock of outgoing models, no significant budge on sister brands like Skoda or Audi.

FaaF

https://www.boards.ie/discussion/comment/121525310#Comment_121525310

Totally agreed - and it may be to their detriment. If NEW VW stock reverts to previous pricing, I don't see any meaningful numbers purchasing it when they see what else is available on the market.

I know of many people that wouldn't dream of buying a Tesla as the interior divides opinion so much. Enter the BYD Seal, designed by a team headed by an ex-Audi designer, and their interest will likely be peaked. They also have the Seal U coming in the New Year, which will pull some buyers from the Model Y and ID ranges.

Interesting times ahead, for sure.

Padre_Pio

https://www.boards.ie/discussion/comment/121525219#Comment_121525219

BYD seal is €25k in China, and €46k here. They can cut prices if they want.

Gumbo

https://www.boards.ie/discussion/comment/121525345#Comment_121525345

Of course they “can”. But “will they”?

FaaF

https://www.boards.ie/discussion/comment/121525354#Comment_121525354

Either they will or new manufacturers will enter the highly profitable market - and either is a good thing for us, the end buyer.

FaaF

On the other hand, whilst the Chinese government are surely looking at this as them potentially being the replacement for what is the German powerhouse of auto manufacturing, the EU officials are becoming more and more fearful for their industry. Don't be surprised if larger tariffs are applied on imports in the coming years.

josip

https://www.boards.ie/discussion/comment/121524949#Comment_121524949

What category would someone who bought an EV before this year fall into in 2023? According to your interpretation, they aren't categorised and are only categorised in the year of their purchase.

creedp

https://www.boards.ie/discussion/comment/121525184#Comment_121525184

That contribution is just that bit too far on the wrong side of condescending IMO and unlikely to win friends from the many people whose income has not come within an asses roar of keeping pace with inflation. Sorry you have been left behind....

gammon199

https://www.boards.ie/discussion/comment/121525354#Comment_121525354

They have to

The mass market ain't paying those prices, word is out now and consumers will wait the manufacturers out

The low hanging fruit have been got, the people that paid 40k for Kona EV are the same people that paid €500 for a DVD player

If people were paying those prices we wouldn't be seeing all the Tesla price cuts and VW firesale

VW have invested billions and are probably in the worst position out of all the auto giants

The Koreans are next now, the French just make compliance cars to get around EU fines so they'll take time to reduce, the Germans are under pressure to deliver and keep jobs so I fully expect them to drop even more or introduce cheaper models.

Some bright spark over in China will bring a Dacia style EV brand with steel wheels, big battery, no fancy infotainment, no fancy lights, pull up windows and they will kill the auto giants margins eventually, VW group and the likes CEOs must be having sleepless nights thinking about that one, gonna be some big auto giants going out of business or merging by the end of the decade

Imagine a Duster style EV with 60kWh battery and 300km range for 18k, mass market will jump then, as its not like with engines, all EVs drive well.

BYD are upmarket, we've seen nothing from Chinas economy of scale regarding cheap EV's yet.

ted1

The EU are looking at Chinese imports and state aid for Chinese car companies, I would not be surprised to see 10% added to cars coming from China

FaaF

https://www.boards.ie/discussion/comment/121525441#Comment_121525441

It would have been a difficult proposition to develop a Duster style EV last year with lithium prices so high and batteries being so expensive - the battery would represent such a high proportion of the overall cost of a low priced vehicle.

This brings me back to one of my original points. Surely some big investors will be looking at the market, with lithium prices having dropped over 80%. Set up a new company, hedge lithium prices 2 years out and start producing low cost vehicles with your cost of batteries being lower than they've been in years. We may even see a Audi/VW/Seat style offshoot of BYD with a new budget brand. Who knows?

FaaF

https://www.boards.ie/discussion/comment/121525467#Comment_121525467

Agreed. I believe they're currently investigating and such investigations tend to take 12-18 months - though I suspect this one will be fast-tracked.

Gumbo

https://www.boards.ie/discussion/comment/121525491#Comment_121525491

Which throws water on the statement that their prices will drop.

We are all just guessing at this stage. No Crystal ball.

gammon199

https://www.boards.ie/discussion/comment/121525467#Comment_121525467

Yep, a war is coming

EU will try all the dirty tricks in the arsenal to save the German and French auto industry, the Koreans and Japanese haven't stepped on any toes, make only overpriced EV's too, just how EU like it so they won't touch them and Tesla have 2 cars, no threat in the big scheme, the Chinese though, they are a threat, a big gone

FaaF

https://www.boards.ie/discussion/comment/121525519#Comment_121525519

Yes, applying some logic based on facts (manufacturing costs have dropped by nearly 30%) and guesswork (a 10% tariff could be introduced) and discussing - one of the main points of a forum 😊

Bear in mind that the drop in manufacturing costs mean that we may see manufacturers absorb any theoretical tariff and still drop prices.

Of course, recent EV buyers or those awaiting a new BYD Seal will be annoyed in the short-term if prices drop further, not realising that lower prices are better overall for them in the long term, regardless of how much they may have saved had they held off on their current purchase for a few months.

How many times over the years have we heard from advertisements or dealers of VW/Audi/BMW, "buy now before the next 20xx price rise". It's good to see that turned on it's head.

gammon199

https://www.boards.ie/discussion/comment/121525483#Comment_121525483

The race to the bottom hasn't started yet, in their eyes still plenty of suckers out there

We will see those brands when they dry up

timmyntc

https://www.boards.ie/discussion/comment/121525520#Comment_121525520

Isnt VWs biggest market the Chinese?

Any EU sanctions will surely be matched by China and hurt German autogiants even worse.

FaaF

https://www.boards.ie/discussion/comment/121525635#Comment_121525635

I wouldn't know the figures to be honest. However, I'd be surprised if VW's market share isn't reducing dramatically. If they cannot compete here, surely their ability to compete in China is significantly lower.

Padre_Pio

https://www.boards.ie/discussion/comment/121525635#Comment_121525635

BMW is something similar, plus a lot of automakers have partnered or are part owned by Chinese companies.

Geely owns 80% of Volvo, 50% of Lotus and Polestar, 10% of Mercedes and has a technology partnership with Renault to develop EVs.

sh81722

It's great that the EVs are more discussed now as spending 50+ k on an iCE without thinking about the EV alternative should not happen. Remember every ICE bought now will be an unwanted dead horse by the end of it's natural lifecycle.

gammon199

https://www.boards.ie/discussion/comment/121525635#Comment_121525635

They are not profitable there even with ICE, its a war they can't win with EV's, which are very easy to make compared to ICE, losing Europe would hurt them more than losing in China.

VW did it to themselves anyway, PHEV's was the obvious solution for the mid-term, good profits and low emissions, make a few compliance EV's. Everyone laughed at Toyota but they'll get the last laugh, they've sat back and learned from others mistakes while remaining profitable and avoiding the emission fines with hybrids. Making your own batteries at your own plants with battery partners was seen as the solution long term, VW invested billions, as did Tesla in plants, but now its just cheaper to buy direct from China and cut out the plants, batteries were always gonna be a commodity, Toyota spent nothing and can source batteries as easily as VW now.

A smart man makes a mistake, learns from it, and never makes that mistake again. But a wise man finds a smart man and learns from him how to avoid the mistake altogether

That's Toyota

Toyota ranked world’s most valuable automotive brand - Drive

sh81722

When considering the right car to buy, you only need to worry about the typical use case. Can you fit or arrange a charger to be installed somewhere where the car sits lots of time? It's your responsibility to get your personal charging sorted out but if it is not possible you should not buy an EV yet. For the fortunates that can you should really think hard for your next car choice, especially when buying new.

gammon199

https://www.boards.ie/discussion/comment/121525758#Comment_121525758

I would back the opposite tbh

ICE will be rare and EV will be common, usually rare is worth more

Used market is showing those signs too, EV's are depreciating far quicker than ICE

If someone wanted to make money, I'd be buying good used ICE

sh81722

https://www.boards.ie/discussion/comment/121525796#Comment_121525796

We'll know around 2030 which of these predictions is the right one.

tobefrank321

https://www.boards.ie/discussion/comment/121525298#Comment_121525298

The multiple apps is the number one problem imo and even an experienced user like you had issues. Of course most early adoptors will say they never had an issue or won't tell you if they did.

Its daft the chargers dont go use normal card payments.

A tourist here would also have issues downloading an Irish app if their google play country is set to another country.

The whole thing has been made complicated for most people who just want to rock up and get a quick charge.

And its unlikely to be solved while some people go around saying its ok, not an issue.