With gasoline prices constantly lower than last year and increased consumer appetite for SUVs, crossovers and pickup truck, deliveries of plug-in hybrids and electric vehicles have stumbled.
With sales dropping constantly in recent months, industry experts and analysts have dropped the ball on the gasoline prices, but a new study highlights the existence of other factors in the equation – such as the residuals, or trade-in prices, which have been plummeting lately when it comes to battery-powered autos. Electric vehicle fans have been using for a long time two important arguments to support their benefits and promote the green technology. First off, the environmental impact – or rather lower or complete lack thereof. And secondly, the potential financial savings incurred from switching to the less expensive electricity, rather than gasoline, for travel.
The financial aspect is getting harder to believe every day now, though. Gasoline prices are now around a quarter lower than during the same period of last year and way below the spring 2014 peak of around $4 a gallon. And the latest dropping yield from residuals might actually overshadow the eventual fuel cost savings. “The electric car premium over a counterpart gasoline model for mainstream brands has pretty much disappeared for used vehicles from an average premium of $16,600 for new vehicles,” comments a summary of the research done by the Black Book, a service that tracks used vehicle pricing. “In fact, in a couple of cases, a used electric model now costs less than (its) gasoline counterpart.” Naturally, the low residual value is also a reflection of the weak new vehicle sales across the segment as consumers are increasingly backing away from high-mileage vehicle offerings.