A Battery is Expensive - so, Lease

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Battery leases make comeback; electric car conspiracy fans take note | News Blogs - CNET News
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Battery leasing articles

Nissan Electric Car Chief Explains LEAF Battery Leasing : Gas 2.0

Battery leasing could help ease anxiety about hybrids - USATODAY.com

...Another plus for leasing is that it would make it easier to take advantage of another characteristic of lithium-ion batteries. They'll have up to 80% of their useful life left when they're no longer strong enough for use in cars, Patil says, and the leasing firm would be in a position to find other uses for them, such as for power backup at computer farms...

The Nissan Sell Or Lease Battery Connundrum « Electricnick, The EV Revolution

Nissan Considers Battery-Leasing for Electric Cars | Hybrid Cars

Eyeing Battery Afterlife, Nissan Holds Tight to LEAF Leasing

Do you wanna lease your battery?: Leaf Forum: Nissan Forums / Infiniti Forums - NICOclub

Buy the car, lease the battery - Springwise

Battery rental may spark electric-car boom: GM - www.drive.com.au

Battery leases make comeback; electric car conspiracy fans take note | News Blog - CNET News

 

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http://www.teslamotorsclub.com/battery-discussion/637-battery-expensive-so-lease.html <== (Moderators: Thread merge opportunity.)

Leased Electric Car Batteries Take a Big Step Forward | BNET Energy Blog | BNET

Batteries not included - Business - SignOnSanDiego.com

 

[Robert.Boston]

consumers want to recoup extra cost in a year

NYTimes.com: Wanted or Not: Alternative-Fuel Cars Flood Auto Show

Most consumers want to be able to recoup the additional cost of an alternative-technology vehicle within a year, Mr. Anwyl said. At today’s gas prices, the payback generally takes several years, if not more.

 

[ckessel]

NYTimes.com: Most consumers want to be able to recoup the additional cost of an alternative-technology vehicle within a year, Mr. Anwyl said. At today’s gas prices, the payback generally takes several years, if not more.

Seems like there should be some way for an EV manufacturer to offer a cheaper up front price and a pay-as-you-go on the battery. I think a solar company does that (Solar City?) where the installation is cheap or free and you rent the panels, but the energy savings basically pays for the rental cost and then some. If there was a way to set that up for EVs it would bring the "base" price down below an equivalent ICE and the battery "rental/lease/whatever" cost would be offset by fuel savings.

 

[dpeilow]

That is exactly what Renault is doing.

 

[TEG]

Nissan had basically said the same thing for the LEAF at first:
Nissan to lease LEAF battery for $150/month
But then did a change of direction and decided to keep the pack as part of the car:
No Battery Leases for Leaf, Says Nissan.

Some of it may have been due to bad PR / backlash from people still remembering the GM EV1 "we are taking our cars back" fiasco. There had been concerns expressed like "what if they don't renew my battery lease?"

 

[ChadS]

I don't understand why "long payback" is a problem. I mean, I understand that people psychologically don't like to take a hit now for a payoff later. But I don't think that applies here.

Most people get a loan or lease anyway. Let's say a gas Focus is $250/month, and a Focus electric is $375/month. But the average US driver saves $121/month in fuel costs, so they get their "payback" (same monthly outgo for a better car!) immediately.

What am I missing? (Serious question; I have never had a lease or loan and only look at TCO, so I don't understand how most people buy). Are they really only considering up-front costs, and not the payment? Are my guesses on the lease rates that far off? I know Leaf and Volt can be leased for $350.

I suppose one problem with a higher-up-front car is that if the car is destroyed, or sold underwater, you are on the hook for a larger loan payoff. But then again, if nothing happens to your gas cars but gas prices continue to rise, you are on the hook for larger gas payments. Another problem could be that the down payment would have to be higher.

 

[ckessel]

I don't understand why "long payback" is a problem. I mean, I understand that people psychologically don't like to take a hit now for a payoff later. But I don't think that applies here.

The article said folks want to recoup within a year, so it's pretty much the long payback issue. It's also a sticker shock marketing issue . If you can bring the MSRP sticker price down that helps get past one of the initial hurdles of getting someone to look at an EV.

 

[ChadS]

I understand the sticker shock part, because most people haven't calculated how much they spend on gas (average car 22mpg, 150k miles - that's 6,818 gallons, at $3.50 per gallon (like it's going to stay there!) that's almost $24k.

But I still don't understand what "payback" people are looking for. I understand many lazy people might not do the math and have sticker shock; but if they don't do the math, how do they "know" the payback "takes several years or more"? In some cases (as in the example above) the monthly payments for EV + fuel will be less than gas car + fuel.

 

[ckessel]

But if they are calculating payback, surely they are looking at how much they are spending.

You give vastly more credit to the average person than they deserve . "I was told there would be no math" is practically a lifestyle motto these days.

They look at the two prices and basically go "that one looks enough bigger that I'd have to do math, so it must be worse." If you have to do math to show something to them, they look at you suspiciously like you're doing a magic trick. Seriously.

 

[dhrivnak]

While I completely agree with Chads personally. Most people I find do not look at monthly energy costs. Being an engineer I do not see how but I have hit upon this issue MANY times.

 

[Arnold Panz]

But I still don't understand what "payback" people are looking for. I understand many lazy people might not do the math and have sticker shock; but if they don't do the math, how do they "know" the payback "takes several years or more"? In some cases (as in the example above) the monthly payments for EV + fuel will be less than gas car + fuel.

It's for hybrids, not EVs. A hybrid version of a standard car generally costs thousands more. Therefore, one can calculate, based on the better gas mileage of the hybrid vs. the standard version of the car, and averaging a certain number of miles driven per year, how many years it would take to "make up" the difference between buying the hybrid version of a car instead of the regular version based on the gas savings over that time period. This can be done with, for example, the Toyota Camry, Lexus RX, etc.

This was a common question when hybrids came out. It doesn't really work for EVs, or even for hybrids (like a Prius) that don't really have a non-hybrid equivalent. You'll notice in the article that they even compare a Volt to a Cruze.

 

[zack]

It would be nice to be able to expand your battery pack as you go, so if you decide you need more range, just buy an expander module like you buy computer memory.

 

[Doug_G]

I've pointed out to a few people that you have your monthly payments plus the gasoline. If you remove the gasoline costs then you could afford the more expensive car. They've all "got it".

 

[EVNow]

Most people get a loan or lease anyway. Let's say a gas Focus is $250/month, and a Focus electric is $375/month. But the average US driver saves $121/month in fuel costs, so they get their "payback" (same monthly outgo for a better car!) immediately.

Focus Hatch is 18,300. FFE is 32,500 (after Tax Cr). At 5% the monthly payments are $345 & $613. The difference is $268.

At 33 mpg, 1,000 miles a month and $4/gallon, it costs someone only $120. At 2,000 miles a month the difference starts to disappear - but that is very high mileage and brings its own set of questions about battery warranty and durability.

The quoted comparison - Volt vs Cruze, I'm sure works even worse for Volt.

This is the reason why people who buy a plug-in buy because they attach a value to it being a plug-in. Just like people who buy a luxury car instead of a Camry.

BTW, if we do that math comparing Mazda 3 to Leaf 2011, Leaf will actually come out ahead.

 

[vfx]

I thought the Volt Cruze comparison were far because they are different class of cars. Same size, different features.

 

[ChadS]

Focus Hatch is 18,300. FFE is 32,500 (after Tax Cr). At 5% the monthly payments are $345 & $613. The difference is $268.

The base Focus hatch is not a good comparison for the FFE, which will be their top-of-the-line model completely aside from the powertrain.

My numbers were lease numbers. After gas savings, there is no difference. Your numbers are purchase numbers; but in addition to not using comparable vehicles, you have not included the higher resale value of the FFE (which is used to set lease rates). Which admittedly doesn't help with the payments, but it does make the TCOs comparable.

Although as we've all noted, none of this matters because nobody does the math...

 

[EVNow]

My numbers were lease numbers. After gas savings, there is no difference.

Has Ford announced lease numbers ?

Interestingly, Volt & Leaf cost the same in terms of leasing. That didn't stop hoards of people from bashing Volt as being too expensive. In general I think people don't look at lease numbers when comparing.

 

[ChadS]

Has Ford announced lease numbers ?

No. I was speculating based on Leaf & Volt numbers.