Luxury EVs hit hard by depreciation

COMMENT

There may have been some form of compromise reached on the nature and rollout of the 2025 New Vehicle Efficiency Standard (NVES), but many questions remain unanswered when it comes to the Australian government’s first new-vehicle emissions legislation.

Among them, who ‘owns’ the credits or incurs the penalties that will be a key part of the carbon P&L that will facilitate NVES? As it stands, the credits and liability for penalties sit with the holders of the type approvals for the vehicles – in effect the car-makers (OEMs).

The devil in the detail is this can be complex in its own right. For instance, these can sit with separate corporate entities under the same brand umbrella. And let’s not start with the complexities generated when brands are imported by a third party…

One thing is for certain, there’s much bureaucracy to be sorted before there can be any hope of the system functioning as intended. Watch this space.

Meantime, auto consumers’ intentions are evolving rapidly, battered this way and that by the various technology factions. Pro-EV rhetoric is reaching fever pitch, while anyone daring to question an all-EV future runs the risk of being labelled a luddite – or worse.

carsales’ own data shows EV intention is waning. It’s a sentiment that I’m hearing from both sides of the fence – the auto industry and auto consumers.

Recent Roy Morgan data shows significant desire from Aussie consumers to buy a new car, but the majority are looking at hybrid rather than battery-electric.

With cheaper entrants, attractive leasing options thanks to no Fringe Benefits Tax and new brands coming into the Australian market, battery-electric vehicles should nevertheless approach 15 per cent market share in 2024.

The numbers will be more rubbery than normal as key player Tesla and EV wannabe Polestar will no longer report via the official VFACTS channel, but the calculations won’t be hard after the fact.

The other calculations that aren’t hard – for consumers at least – are the current savings available to the top end of town keen on going electric.

Indeed, while it will do little to scale EV acceptance Down Under, the huge discounts on prestige EVs right here, right now are beyond noteworthy.

A scan of carsales classified shows there are significant numbers of dealer demo and dealer used luxury electric cars available at massive discounts.

On the surface this suggests that either these cars aren’t moving and dealers are registering them to be able to sell them and/or that quite a few people are buying them and giving them back quickly.

Used car classifieds are a moving feast but in no particular order, consider the following premium EV discounts currently listed at carsales…

Experts will say there are myriad factors that affect resale values for EVs, but chief among them is buyer confidence.

High depreciation has hit the UK market hard in the EV space. Here consumers are still drinking the ICE brigade’s scaremongering – among the topics poor battery life and potential degradation – in the face of eight- and 10-year warranties that more or less inoculate buyers from any real-world issues.

Whatever the true cause, if the asking prices for (very) lightly used EVs from established brands like Mercedes-Benz, BMW, Audi and even Porsche are bellwethers for the used EV market as a whole. then the industry has a BIG job to do to build confidence with consumers.

Australia’s acceptance of EVs has a long road ahead.

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