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CloseHow government incentives affect electric vehicle residual values
Find out how government incentives play a crucial role in determining electric vehicle residual values, and how you can protect the long-term value of these models in your portfolio.
Understand how government incentives improve the desirability of your EV portfolio.
Recognise how incentives can negatively impact EV residual values and maintain them with expert-tailored forecasts.
HOW WILL INCENTIVES AFFECT LONG-TERM RVS
Learn how residual values will stabilise as we approach a net-zero future and how you can prepare for the changes.
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How government incentives encourage EV adoption
Some government incentives promote electric vehicle adoption by reducing upfront costs, making them more accessible and cheaper to infleet. Some recent European incentives that work include:
- Tax benefits: Commercial EVs may benefit from VAT deductions or exemptions
- Rebates and grants: These reduce the price at the point of sale, making EVs more competitive
- Reduced registration fees: These include reduced fees or exemptions from tolls to make an EV more appealing.
These incentives increase EV sales and popularity in the new and used car markets, but discounts can impact vehicle resale values.
You can track these market changes and access forecasts with our tool EV Volumes, which is updated monthly to help your business stay protected against sudden market movements. Stay on the forefront of EV trends – click below to learn more about EV Volumes today.
How government incentives can harm electric vehicle values
Although incentives help boost EV sales, they also carry negative effects that you should be aware of:
- Price cuts lead to an initial decrease in residual values: Discounts drive competition among comparable models, often lowering other EVs’ values in the new-car market
- Incentives only apply to new cars: Used EVs don’t receive the same incentives as new EVs, making it difficult to maintain their value
- Policy changes: Changing policies cause market volatility, therefore making values less predictable and EV models more of a financial risk.
A volatile market makes it more challenging for you to accurately forecast residual values. The true value of your fleet may have rapidly decreased compared to the original forecasts.
Close the gap between initial forecasts and accurate values. Use AutovistaREFORECAST to avoid price discrepancies and thrive in an unpredictable EV market. Click below to learn more.
Why the long-term value of EVs is improving
As government incentives phase out and transitioning to electric becomes more mainstream, residual values are expected to stabilise.
As more fleets and consumers choose EVs, the market should become more predictable. Depreciation rates are also expected to align more closely with internal combustion engine vehicles.
Governments worldwide are prioritising electromobility and implementing new emissions policies. With EV Volumes‘ data-driven insights on electric vehicle adoption rates, you can easily analyse over 130 markets and adapt to oncoming changes. Click below to manage your business for the net-zero deadline.