Used Leaf Future Depreciation

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WILK

Member
Joined
Jan 4, 2017
Messages
9
Hi Everyone - New member and first time poster. I have to sell my current ICE car and currently have an early-ish reservation for the Tesla Model 3 (which I am sure is a curse word on this site) which I expect to take delivery during Q2/Q3 2018. I found some very low priced used 2013/2014 Leafs in my area (SoCal) and am trying to figure out what to do for a car for the next 18-24 months. I went to a local Nissan dealer over the weekend just to learn more about Leafs (other than what I have learned on these forums) and the guy basically told me that a used Leaf will essentially be worthless by the time I would be going to sell it, which I have to take with a grain of salt considering he was trying to sell me a lease. Knowing that there will be Leaf fan-boy bias here, what would you do given this scenario?

Buy a used Leaf - 2013 or 2014 Leaf S, lease return, 11/12 bars, 30-40k miles, out the door for less than $7500 including taxes/fees. I know about Leafspy and the ODBII. Sometime in mid 2018 i would be selling my used Leaf, then 4-5 years old with approximately 40-50k miles. This scenario, out of pocket I would be out $5k, minus whatever I could sell it for in 2018, which at this point is a huge question mark for me. Flexibility in that I could sell the Leaf whenever my Tesla arrives

Lease a new Leaf for 24 months - approximately $3-$4k out of pocket (after the equity from selling my car) that would just be gone, and I would be forced to keep the car for the entire 24 month period

Lease a super cheap ICE car - approximately $2-$3k out of pocket (after the equity from selling my car) that would just be gone, and I would be forced to keep the car for the entire 24 month period

Drive my Father-in-Law's 20 year old dirty gas-guzzling SUV with no A/C or heat or functioning radio, save about $500 based on my current car's equity.

With Leafs prices falling drastically over the past few years, how much more are they going to fall? The breakeven point for buying a used Leaf vs leasing would be that I would have to be able to sell the Leaf in 2018 for somewhere around $2-$3k, but I would hope that I could get more and reduce my out of pocket expense. What do you think?
 
WILK said:
currently have an early-ish reservation for the Tesla Model 3 (which I am sure is a curse word on this site)
Not at all we love all EVs, we are just here because we HAVE a Nissan version. I'm going to continue to read the rest of your post.

Depends upon what you need for a car. Can you drive a EV that can do only 40 miles on a charge? Do you have access to 220V charging at home or work?

If I was only needing 40 miles per day, i'd buy a used Leaf. Choose your vintage.. 2011-2012 or 2013 onward for extra features and decide which model of each year.. they are not all the same. I have a 2012 SL but later models have things a SL had in 12 that are standard on a 2015 S and so on. I assume you'll not need much heat from the car since you're in SouthCal but you will use A/C some days.

If you need the full range only a new car can give you, then you an sink money and do a 2 or 3 yr lease.. you are in the best state to get them.. check out the 'END OF LEASE Strategies' posts, lots of deals listed in the last few pages of people taking up the 2016 models with great numbers I am jealous of.
 
One question you are asking is a prediction on Leaf selling price 2 years from now. No one can accurately predict the future.

We do know that:
1) EVs depreciate more than ICEs early in the cycle but depreciation seems to slow down.
2) At $7500, the Leaf is already depreciated quite significantly.
3) Southern California tends to be warmer than other places, so the battery will degrade faster.
4) The Leaf has many aluminum body panels, so may not rust out as fast as a steel car.
5) Today, new batteries are approx $6K if you turn in your old battery.
6) Newer models will have more features. For example, starting 2013, they have a heat pump for more efficient heating.
7) Newer models may or may not have more range.

Bob
 
Since you are looking at 2013 or 2014 Leaf's and want to have an idea of price a year or two later, look at the prices of 2011 and 2012. A 2011 in CA seems to go for about $5K now.
 
If you are looking to buy a car to only keep it 2 years and drive only 10-20K miles, then forget about a Leaf, any Leaf. Buy a cheap car and plug away..

Or drive your relative's old SUV. You should never buy a new or close to new car (especially a Leaf) and be worrying about depreciation before you even buy a car.

When you want to invest in a Leaf for the long haul (4+ years), then buy one.

OLD INDIAN SAYING (about buying a car) - "It will cost more than you think, and you will get back less than you think".
 
4) The Leaf has many aluminum body panels, so may not rust out as fast as a steel car.

That's only the 2011-2012 version. Leafs don't seem to rust a lot, but you do get rust under the hood and on the underbody.

My take is that if you want to buy a car now and then sell it easily for nearly what you paid for it, don't get a Leaf. Maybe a Corolla... If you want an EV that will cost about a grand a year, find a 10 bar Leaf that's cheap, treat it gently, and then sell it for $2k less than you paid.
 
Depreciation is a subject sore to my heart at the moment due to my current car (Fiat 500). I have a 2012 Fiat 500 and its current value is only around $3500 which, to me at any rate, is horrible. Based off of the Leaf models that I have been looking at, they are suffering a similar fate. I just got home from test driving a '14 S with 21K miles on it that was for sale for $7500 and you have to figure that was a what? $30,000 car or thereabouts? They had a SL model for (leather, Bose, etc.) for $10K and that was what? A mid thirty thousand dollar car? They had a 2015 that sold before I got there and it was something like $10,200 and it's only a year old. Given those kinds of numbers, there is absolutely NO way I would spend $30K to $40K on a new Leaf when it's only going to be worth $7500 or so the next year, especially when there are so many out there used for cheap and with low miles.

So I would advise against a Leaf and if you have a free car you can use for two years, go for that and save up additional money towards the car you really want. Frankly, I wasn't overly blown away by the Leaf I drove today and given what I experienced today, I would be hard pressed to justify this car's new price (purely a personal opinion) anyway.
 
Thanks everyone, your responses have been very valuable. With a used Leaf I am just trying to get a gauge (obviously no one can predict the future) of what the approximately residual value will be in 2018. If I can sell the car for like $2k less than I bought it for (aside from the taxes, etc) it would be good for my situation. If the depreciation continues at the same rate, and my $6500 Leaf is now worth $2k in 2018, then I would have to go in another direction.
 
LeftieBiker said:
I don't think a $6500 Leaf would depreciate to less than $4k in 2 years unless the range fell to under 30 miles.

Why not? I'm already seeing one year old 2015's for sale for $10K or less and that means they have lost over $20K in a year. I would say based off of the prices I have seen, it is very likely a $6500 Leaf could be worth half that in the next two years. Unless gas prices go back up to near $5/gallon, I think these EV cars are going to continue to suffer from this.
 
You have your answer from the salesperson. They said zero or worthless. What they actually mean is zero is what they will pay you for it because they still have to make a profit on the resale at retail prices. Since most dealerships look to get $2000-$4000 profit on a used car, you can expect the future value will be in that range. I've seen this over and over. People forget about the difference between wholesale and retail as well as the fact that trading in a used car when buying a new one is actually two transactions (and typically this is where the dealerships make their big profits). Add to this the $7500 US tax credit and state or local incentives for buying new, and it makes it difficult to compare used with new. If I can get a new Leaf for less than $20,000, someplaces even closer to $15,000, why would I pay more than $10,000 for used, older technology, with a degraded battery? Don't agree? Then how about you buy my 386 computer still running Windows 95 for $2000? Sad as it is for us original 2011 owners, it's a big benefit for the low income buyers. Gee, those tax incentives for the "rich" have actually trickled down to the poor (well maybe not poor but rather, middle class).
 
OP, why do you *have* to dump your ICE car now ?
I suspect you will find that even if you have to dump $2000 into your current car to keep it running until the M3 comes along, it will work out to be considerably less expensive than playing an 18 month swap game.
 
If this original poster is worried of depreciation of a $6k car, then you certainly ARE NOT financially sound to be buying this, or any newer car.

You sound like you are a young person, and I would recommend, like I have done with my children to buy a $2K old civic or corolla, and then sell it for close to that price in 1-2 years.

Also if these are your concerns, please get into reality and stop talking about a Testla.... That is the worst investment of a working person's money.... If you want a toy, get a 4K TV.
 
tattoogunman said:
LeftieBiker said:
I don't think a $6500 Leaf would depreciate to less than $4k in 2 years unless the range fell to under 30 miles.

Why not? I'm already seeing one year old 2015's for sale for $10K or less and that means they have lost over $20K in a year. I would say based off of the prices I have seen, it is very likely a $6500 Leaf could be worth half that in the next two years. Unless gas prices go back up to near $5/gallon, I think these EV cars are going to continue to suffer from this.

That's not really a fair comparison since the new 2015 Leaf didn't really sell for close to $30K once you had factory incentives and the tax credit. Including those, I bought my S for about $16K new with 0% financing. I could have bought used for less, but I was willing to pay more for the full warranty, the new chemistry, and peace of mind knowing that I wasn't buying someone else's problem. I'm waiting on a Model Y - never cared for low riding/low roofline sedans being on the big/tall side. I figure by the time the Y arrives, I'll be ready to replace the Leaf and will have gotten several years of use and gas savings out of it even if it's basically worthless.

I'm hopeful that Nissan (or a third party) will make higher capacity replacement packs available for the Leaf at a reasonable price as new technology is introduced. That would certainly make used Leafs more attractive and throw a few bucks towards the dealers.
 
Powersurge - thanks for the lecture, however you are making a lot of assumptions that are completely untrue. I definitely have enough $$ to buy this car, why is it a bad thing to wonder about how much money I could potentially lose regardless of the total value? I am simply trying to weigh different options based on the financial implications, and the reason I can make these decisions is because I am intentional with the way I spend my money. I want a reliable car for the next 18-24 months that does not have excessive mileage, and the Leaf is intriguing because I can ease into the EV lifestyle. My Tesla is going to be the car I have for the extended foreseeable future, so while it will depreciate I am not as concerned based on the time of ownership.
 
WILK said:
Powersurge - thanks for the lecture, however you are making a lot of assumptions that are completely untrue. I definitely have enough $$ to buy this car, why is it a bad thing to wonder about how much money I could potentially lose regardless of the total value? I am simply trying to weigh different options based on the financial implications, and the reason I can make these decisions is because I am intentional with the way I spend my money. I want a reliable car for the next 18-24 months that does not have excessive mileage, and the Leaf is intriguing because I can ease into the EV lifestyle. My Tesla is going to be the car I have for the extended foreseeable future, so while it will depreciate I am not as concerned based on the time of ownership.

With my crystal ball, I see a value floor around $3000 as long as it still has usable battery capacity and has a reasonably straight body. As others have said, at this number, this is not a trade-in value, but more of a Craigslist value since most dealers want more profit margin. For your specific situation, why not estimate that you'll lose $500 per quarter and consider anything you get back over $3000 a bonus? It probably won't be cheaper than whatever gas car is available to you, but you'll be able to have reliable and relatively new EV transportation.

My floor number is based on the quality of the typical $3000 car, a 150,000+ mile beat up compact car with marginal reliability. If we're not already there in the 6-7K range, I believe 3-4K will be the point that Joe Sixpack won't be able to resist a newer car with 1/3 the miles of everything else he's looking at.
 
wvleaf said:
tattoogunman said:
LeftieBiker said:
I don't think a $6500 Leaf would depreciate to less than $4k in 2 years unless the range fell to under 30 miles.

Why not? I'm already seeing one year old 2015's for sale for $10K or less and that means they have lost over $20K in a year. I would say based off of the prices I have seen, it is very likely a $6500 Leaf could be worth half that in the next two years. Unless gas prices go back up to near $5/gallon, I think these EV cars are going to continue to suffer from this.

That's not really a fair comparison since the new 2015 Leaf didn't really sell for close to $30K once you had factory incentives and the tax credit. Including those, I bought my S for about $16K new with 0% financing. I could have bought used for less, but I was willing to pay more for the full warranty, the new chemistry, and peace of mind knowing that I wasn't buying someone else's problem. I'm waiting on a Model Y - never cared for low riding/low roofline sedans being on the big/tall side. I figure by the time the Y arrives, I'll be ready to replace the Leaf and will have gotten several years of use and gas savings out of it even if it's basically worthless.

I'm hopeful that Nissan (or a third party) will make higher capacity replacement packs available for the Leaf at a reasonable price as new technology is introduced. That would certainly make used Leafs more attractive and throw a few bucks towards the dealers.

Sure it is - market resale value isn't based off what people paid or didn't pay for their cars, it's based off market residual value of the car's MSRP. You could have gotten that car for $10,000 or less, but that doesn't mean its resale value is going to be any higher than it really is.

I finally got around to driving a '14 S the other day and was not impressed. If I ever do consider the Leaf again, it would definitely have to be a 200 plus mile range, better interior/exterior design/build quality, and it would have to have a tad bit better performance. That car screamed cheap even though it was expensive when new - purely my personal opinion.
 
tattoogunman said:
wvleaf said:
tattoogunman said:
Why not? I'm already seeing one year old 2015's for sale for $10K or less and that means they have lost over $20K in a year. I would say based off of the prices I have seen, it is very likely a $6500 Leaf could be worth half that in the next two years. Unless gas prices go back up to near $5/gallon, I think these EV cars are going to continue to suffer from this.

That's not really a fair comparison since the new 2015 Leaf didn't really sell for close to $30K once you had factory incentives and the tax credit. Including those, I bought my S for about $16K new with 0% financing. I could have bought used for less, but I was willing to pay more for the full warranty, the new chemistry, and peace of mind knowing that I wasn't buying someone else's problem. I'm waiting on a Model Y - never cared for low riding/low roofline sedans being on the big/tall side. I figure by the time the Y arrives, I'll be ready to replace the Leaf and will have gotten several years of use and gas savings out of it even if it's basically worthless.

I'm hopeful that Nissan (or a third party) will make higher capacity replacement packs available for the Leaf at a reasonable price as new technology is introduced. That would certainly make used Leafs more attractive and throw a few bucks towards the dealers.

Sure it is - market resale value isn't based off what people paid or didn't pay for their cars, it's based off market residual value of the car's MSRP. You could have gotten that car for $10,000 or less, but that doesn't mean its resale value is going to be any higher than it really is.

I finally got around to driving a '14 S the other day and was not impressed. If I ever do consider the Leaf again, it would definitely have to be a 200 plus mile range, better interior/exterior design/build quality, and it would have to have a tad bit better performance. That car screamed cheap even though it was expensive when new - purely my personal opinion.

No argument on the resale value, it is what it is. Perhaps I misinterpreted your original statement and read it as everyone who bought a new Leaf suffered $20K in depreciation. The difference between MSRP and resale being $20K, sure. In my case, starting at $16K and selling it at $6K is an actual depreciation of $10K for me personally, regardless of what the MSRP is and that's the number I care about. Point being, the MSRP is a fiction on the Leaf due to the reality of tax credits, rebates, and incentives and individual depreciation experience is far less as a result.
 
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