Will prices of EVs increase due to 2035 ban on new combustion vehicles?

My Nissan Leaf Forum

Help Support My Nissan Leaf Forum:

This site may earn a commission from merchant affiliate links, including eBay, Amazon, and others.

akhung

New member
Joined
Sep 1, 2021
Messages
3
Hi everyone,

I have a bit of a question that has been stuck at the back of my head right now. I'm no economist so I thought I'd ask.


  • With the ban on sales of new gasoline in Canada in 2035, will the price of EVs continue to increase or decrease?
  • What about the prices of used gas vehicles? Will it increase or decrease?
  • What is the basis of your speculation?
  • Will used gasoline cars increase in value due

I look forward to hearing your thoughts and rationale on regarding this topic.

Cheers,
AK
 
The usual market forces will still apply - at least until the ban is imminent. EVs will get pricier if people start to buy them and production stays low. Otherwise it will be discounted Leafs until the panicked rush to buy an EV from a too-small supply, once the ban takes effect.
 
Many people make car purchasing decisions based on emotional considerations. So, I would guess that there will be some people who have an emotional aversion to purchasing an EV. Those people will instead buy a used, good condition ICE just to avoid the EV mandate on new cars. Hopefully a small percentage of people will have that attitude, but if not then expect used but newish ICE car prices to increase in the short term after the mandate goes into affect.

With respect to new EV pricing, supply and demand will dictate that. Right now, the bottleneck is lithium ion battery component scarcity - lithium and cobalt in particular. By 2035, one would hope that high capacity battery packs, built using inexpensive chemistries, will be the norm. If that happens, then battery supply constraints should be much less of an issue and therefore EVs should be cheaper than ICE equivalents.

It's all about the battery pack price per kWh...

Having said that, car manufacturers make most of their money from servicing cars so it will be interesting to see how they try to retain that revenue. Planned obsolescence, unreliable parts, and pitching of expensive warranty contracts seems likely. Yes, I'm a cynic :)
 
Having said that, car manufacturers make most of their money from servicing cars so it will be interesting to see how they try to retain that revenue.

They will put cheaper oil in the "transmissions" just so they can say it needs regular changes.
 
akhung said:
Hi everyone,

I have a bit of a question that has been stuck at the back of my head right now. I'm no economist so I thought I'd ask.
  • With the ban on sales of new gasoline in Canada in 2035, will the price of EVs continue to increase or decrease?
Short term, who knows? I don't. But longer term the cost of making an EV will drop due to the continuing reduction of cost in batteries. The price will eventually follow.


  • What about the prices of used gas vehicles? Will it increase or decrease?

New combustion vehicles for specialty purposes will still be made and used, likely higher costs and prices due to low volume. Used specialty vehicles will also be more expensive.


  • What is the basis of your speculation?

Past history of battery cell prices, and current prototype production of better and cheaper batteries.


  • Will used gasoline cars increase in value due

Collector's pricing might increase price for some. Old junk will rust in peace. Or in pieces. Don't confuse price and value.
 
alozzy said:
Having said that, car manufacturers make most of their money from servicing cars so it will be interesting to see how they try to retain that revenue. Planned obsolescence, unreliable parts, and pitching of expensive warranty contracts seems likely. Yes, I'm a cynic :)

I think that the gradual reduction in cost of the battery coupled with high demand in the future might give manufacturers significant boosts in short term revenue generation.

I agree that most companies will earn their revenue through planned obsolescence.
Unreliable parts though, would hurt the manufacturer's reputation and drive down demand and that would hurt in the long run?
Warranty extension could definitely be a big sell.
 
akhung said:
alozzy said:
Having said that, car manufacturers make most of their money from servicing cars so it will be interesting to see how they try to retain that revenue. Planned obsolescence, unreliable parts, and pitching of expensive warranty contracts seems likely. Yes, I'm a cynic :)

I think that the gradual reduction in cost of the battery coupled with high demand in the future might give manufacturers significant boosts in short term revenue generation.

I agree that most companies will earn their revenue through planned obsolescence.
Unreliable parts though, would hurt the manufacturer's reputation and drive down demand and that would hurt in the long run?
Warranty extension could definitely be a big sell.

An excerpt, from an article I found, RE dealership revenue sources:

So where does the majority of a dealership's profit come from? It's not from car sales, at least not directly. It's from the service and parts department, which accounts for the other 49.6% of the dealership's gross profits, according to NADA.

Many regular ICE maintenance items have high margins yet most of those do not apply to EVs. Either they accept losing much of their profits (unlikely), or they find a way to make EVs less reliable, or they charge way more for the servicing they do.

The one saving grace is that there will likely be more competition, as new EV manufacturers fight for market share, so hopefully that will hold them accountable.
 
Might be related....our local util now offers up to $3k in rebates on used EV's. I haven't bothered to read the details but I assume it only applies to qualified dealers and models.
 
goldbrick said:
Might be related....our local util now offers up to $3k in rebates on used EV's. I haven't bothered to read the details but I assume it only applies to qualified dealers and models.

Is that the scrap it program? I heard that it is ending this year.
 
Nope. They used to give a credit for several new EV's (I got $10k off my Leaf from them) but nothing for used cars. Now it's up to $5k for new and up to $3k for used. Both must be bought from 'authorized dealers' so you must buy from a local dealership but I have to think this will help support the price of used EV's bought from private parties as well.
 
Back
Top