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April 21, 2010

ANALYSIS: EV batteries must not be leased says used car monitor

Used car price specialist CAP says it will refuse to put second hand values on electric cars if batteries are leased, as some carmakers propose.

Used car price specialist CAP says it will refuse to put second hand values on electric cars if batteries are leased, as some carmakers propose. A number of companies are looking at the idea of leasing batteries to future EV owners to keep costs down but Martin Ward of CAP’s monitoring team which predicts future values for UK fleet, leasing and rental companies, said that batteries must be owned by the car buyer. He told the Sunderland International Automotive Conference: “Otherwise you have a situation where you don’t know who owns what? Also how do you insure it – you cannot insure something you do not own. “If the vehicle is written off in an accident, what proportion of the insurance goes to who? There are so many ifs, buts and maybes about EVs at the moment but this is one area CAP feels strongly about. “We have spoken to the British Vehicle and Leasing Association about this and they are in agreement. If you buy an electric vehicle the battery has to be part of it.” In terms of applying residual values, Ward said that at current prices EV’s will only retain about 23% of their value when sold on after three years. As prices come down, however, this will move closer to 50%.

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