Low resale values for electric cars have pushed the leasing firms that drive Europe's auto market to double prices over the last three years and some are threatening to quit the business altogether if regulators force them to go electric too fast, industry executives say.
The jump in prices for electric car leases comes as cuts in subsidies for new EVs in key markets such as Germany are hitting sales and risks stalling Europe's electric transition, just when Brussels wants to step on the accelerator, the executives say.
"If we were pushed very, very hard, that everything has to be electric too soon ... my shareholders will say 'we don't want to take the risk' and we'd be out of the market," said Tim Albertsen, CEO of Ayvens, one of Europe's largest auto leasing firms. "Let's be honest, without us, who will take the risk?"
Ayvens, which is majority owned by French bank Societe Generale, has a fleet of 3.4 million cars, of which about 10% are EVs.
Leasing companies play a pivotal role in Europe as 60% of new cars of all fuel types are leased, according to calculations by environmental group Transport & Environment based on data from market research firm Dataforce.
When it comes to EVs, the proportion is estimated to be as high as 80%.
According to data provided to Reuters by Dataforce, in the 16 European markets where it can identify fleet registrations - including Germany, Britain, France and Spain - 60% of new EVs go to corporate fleets and commercial buyers. Experts say those buyers almost exclusively use leases and about half of the remaining sales to private buyers are also leases.
In markets with no EV subsidies for private buyers, the dominance of corporates is even more pronounced. In Britain and Belgium, for example, individuals accounted for just 23% and 8% of new EV purchases respectively in 2023, Dataforce said.
The price of a lease is designed to account for the depreciation of a vehicle over the typical three-year lease period, based on estimated resale prices, or residual values.
But if second-hand prices end up being lower than anticipated when the lease ends, leasing firms take a financial hit when they get the vehicle back.
For various reasons - from Tesla's price cuts to concerns about charging infrastructure and battery life to the influx of more affordable Chinese EVs - second-hand electric car prices have been sliding in Europe since hitting a peak in October 2022.
According to figures provided to Reuters by data firm Autovista, resale values for EVs in Germany in early July were 24% below pre-pandemic levels and 30% lower in Britain.
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.