Do electric cars depreciate faster than petrol cars?

Summary

• Depreciation is a term used to describe the way a car’s initial value decreases.
• Electric cars depreciate for the same reasons as petrol cars, and at nearly identical rates.
• Joining Onto removes depreciation from the equation thanks to a convenient monthly subscription.

What is depreciation?

Depreciation refers to the way a new car’s value will decrease over time. When you purchase a new car, it’ll be worth 100% its initial value. But over time, as you put miles on the car and it goes through normal wear and tear, the car will gradually be worth less.

How much do cars depreciate per year in the UK?

As soon as you leave the dealer in your new car, it begins losing value. By the end of your first year driving it, the car can depreciate by as much as 40%. And after three years, it’s likely that it will have depreciated by 60%.

Depreciation doesn’t happen at one set rate for every car. For a long time, electric cars were thought to depreciate faster than petrol cars. While some more US-centric statistics may show that this is still the case, electric cars now depreciate at roughly the same rates as petrol cars in the UK.

Why do electric cars depreciate?

In the past, electric cars had unique factors that contributed to their depreciation. The market was much less established, so there was uncertainty about how electric cars would fare at resale. There also weren’t many public charging points yet, so some drivers were uncertain about making the switch without more infrastructure in place.

Today, electric vehicles depreciate for most of the same reasons as petrol cars:

• Mileage
• Wear and tear
• Age
• Condition (both internal and external)
• Service record

Subscriptions with Onto

The risk of depreciation and the eventual resale process can be significant obstacles to buying or leasing an electric vehicle.

But you can avoid all of these hassles with an all-inclusive electric car subscription from Onto. Simply sign up and book your first car. Drive the latest electric cars, without ever having to worry about depreciation.

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