Good luck selling a used EV

Leland Teschler • Executive Editor

There were some interesting developments at the recent and aptly named Battery Show near Detroit for those who follow battery technology. One in particular came from the Michigan-based Our Next Energy (ONE). The firm released details about a 240-Ah prismatic cell battery it has designed and which is said to be the highest energy density large-format cell yet produced. Perhaps the most noteworthy fact about the new battery is that its design eliminates the need for graphite and anode manufacturing equipment—ONE dubs it anode free, though it is indeed polarized. That lets ONE cells be produced using about half the current manufacturing equipment needed to make equivalent capacity cells today.

ONE figures it will be able to turn out the new batteries at a cost of $50/kWh. For comparison, the average new EV battery goes for around $128/kWh, a price likely to rise because of inflation and the scarcity of rare earth minerals.

But if you buy an EV and its battery dies after the warranty expires, you’re probably going to end up paying a lot more than $128/kWh. Greencars, a website specializing in EV learning and shopping, reported in 2020 that 16 kWh Chevy Volt battery packs cost about $4,000 to replace, putting them at about $240/kWh. Keep in mind that a brand new Volt costs about $26,600 when it comes off the showroom floor. A 2011-2015 Chevy Volt remanufactured battery pack is priced at $6,000 at Greentec Auto, a company specializing in hybrid battery replacement. These batteries have 17.1 kWh of capacity, putting their price at $350/kWh in 2021 dollars.

Most EV owners can be thankful that car makers typically warranty the battery in these vehicles for between eight and ten years and 100,000 miles. But it’s clear that out-of-warranty battery problems on EVs or hybrids can get expensive. Recurrent, an organization that covers pre-owned EV transactions, points out that the cost of an out-of-warranty 100 kWh battery (as found on long-range Tesla vehicles) replaced in 2025 might range from $5,600 to $13,500, depending on whose predictions you want to believe.

These estimates assume that industry continues making advances in battery technology similar to that just announced by ONE. Today battery replacements even in budget-priced vehicles are pricey. The Nissan Leaf, which starts at about $27,800, can come with batteries ranging in size from 30 to 62 kWh. Replacement costs for these batteries range from about $3,500 to $9,500. Even hybrid EVs with their relatively smaller batteries have eye-popping battery replacement costs. Consider the 2022 Hyundai Ioniq Plug-In Hybrid which starts at $26,800. A replacement battery for a 2018 or 2019 model had an MSRP of $2,853.53 last year. The battery in the Ioniq HEV is 1.56 kWh, equating to about $1,829/kWh.

New-car warranties mean that buyers of new EVs probably don’t worry much about replacing their batteries. But EV battery cost is a top-of-mind for those of us who typically buy used cars. I myself am in this group. It was more than 30 years ago that I bought my last new car off a dealer lot. I don’t see myself buying a used EV knowing I may have to shell out 15% of what I paid for the car in a year or two when the battery gives out.

I suspect I am not the only potential used-EV buyer who thinks this way. Baring drastic improvements in EV battery pricing, the automotive industry may be faced with a new paradigm as EVs age: It may end up being impossible to sell a used EV without first replacing the battery. Alternatively, buyers like me will be unwilling to buy used EVs without a drastic price drop that far exceeds typical Blue Book depreciation for ordinary ICE vehicles today.

Whatever happens, it will be interesting to watch.