Better residual value: Hybrid cars versus plug-in cars

The Toyota Prius c offers the best residual value after 5 years, and hybrid cars overall offer better residual value than plug-ins.

c hybrid offers best residual value compared to all hybrids and plug-ins

How does plug-in depreciation compare to hybrids?

Obviously, no one wants to buy a new car and then drive off the lot and suddenly realize its worth drastically less than what was paid. Unfortunately, all new cars lose value as soon as the dealer hands you the keys, which is why savvy financial folks, such as Warren Buffett, only buy slightly used cars.

And residual value after 5 years is an even scarier number.

So do hybrid or electric cars hold their value better?

ALG’s Eric Lyman recently told that, overall, hybrid cars hold their value better than plug-ins. Take away tax credits, and the numbers aren’t even close.

Overall, the Toyota Prius c takes top honers, with 44 percent residual value after 5 years. The regular Prius came in second at 42 percent.

The Chevy Volt — after the tax credit — is the top plug-in at 36 percent. Take away the tax credit; however, and the Volt drops to 32 percent. The Nissan Leaf came in at 31 percent, but only 23-24 percent without the tax credit.

Ultimately, it comes down to the battery. As the battery in plug-ins degrades over time, so do the values of plug-ins, especially in pure plug-ins. Fortunately, much work is now being done to find new ways of extending the life of plug-in batteries, such as in back up power systems. As these secondary uses of plug-in batteries become successful, the residual value of plug-ins could increase.

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