Should EV Manufacturers Support the Second-Hand EV Market?

Should EV manufacturers support the second-hand EV market?
Should EV manufacturers support the second-hand EV market?

At this moment in time the second-hand market in electric vehicles is very small to say the least and perhaps not towards the top of the list of your traditional electric vehicle manufacturer. This is not to say that the second-hand market in EVs will not become important but there are at the moment too many variables to make valuing a second-hand electric vehicle very easy.

BMW recently confirmed plans to offer support to both the primary and secondary sales markets, promising to retain as much value as possible for those who acquire BMW vehicles and in particular the BMW i3 electric car. The company will appoint sales agents where BMW electric cars are available and offer a comprehensive support network. However, should EV manufacturers be involved in supporting the second-hand car market?

Technological unknowns

It is common knowledge that the electric vehicle industry is still relatively small, still in its relative infancy, and as such, there are some unknowns with regards to technology. We can roughly guess the longevity of the cars bodywork and the internal motor systems but at this moment in time it is difficult to forecast with any real confidence the longevity of the battery packs. Indeed, when you acquire a second-hand electric vehicle how would you know how old the battery packs were?

Quote from EletricForum.com : "There is a petition on the White House petition page that asks for a national network of electric vehicle charging stations. The idea being that it would help promote electric vehicle adoption by eliminating range anxiety."

There is also the fact that technology is developing so quickly in the electric vehicle industry that in many ways the cars available today could be out of date within two or three years. As a consequence valuing your electric vehicle in the second-hand market place at this moment in time is very difficult.

Supply and demand

In any marketplace the general value of services or products for sale is determined by supply and demand. If there is supply for a particular vehicle but little demand, prices will fall; if there is demand but little supply then prices will rise. The situation in the second-hand EV market is slightly different because the overall market is tiny compared to the traditional fuel powered automobile industry. As a consequence, there are even fewer second-hand electric cars available and those looking into this particular arena at the moment are more than likely looking for the bargain of a lifetime.

Until we see significant progress with regards to supply and demand for second-hand electric vehicles it is likely that some EV manufacturers will offer a form of market/price support. This is essentially a means of saying to potential customers, we appreciate the market is not yet fully developed and we will not leave you high and dry if you decide to sell your vehicle in the second-hand market. Quite how they will offer this support remains to be seen but more companies are now coming around to this way of thinking.

Conclusion

While the primary sales market for electric vehicles continues to grow, with sales in the U.S. alone expected to double in 2013, the secondary marketplace is struggling. The likes of BMW have already confirmed they will offer some form of support in the second-hand BMW electric vehicle market and others are likely to follow suit with similar strategies. It is unclear at this moment in time what form this support will take but already it is injecting a little more confidence into the electric vehicle market as a whole.