The value of the 2015 year model i3 is unique and we may not be seeing a similar effect in future years. Surely BMW i3's will always be "discounted" in one form or another b/c its MSRP is just priced too high to start with, but the values being offered on used 2015 i3's come from a combination of things all happening at once that may not repeat itself down the line. I could be wrong, but here are my thoughts (it'll be interesting for me to read this back 5 years from now):
1. Tesla.
People are holding off buying an EV b/c they think they want the Tesla Model 3 (that was me a month ago). Those that don't have it already are waiting for the base model to be released. When that happens, many people will realize they don't want it anymore b/c all the tax credits are gone. These would-be buyers will look for alternatives which will add to the demand on other vehicles, one of which is the i3.
2. There are a number of new EV's coming out.
This will only decrease demand for the i3 as consumers see they have more options than they once had. Once upon a time, the i3 was the fastest EV out there behind the Tesla Model S. That's no longer the case. The i3 also had one of the largest batteries. We see that's definitely no longer the case. And in fact, people are flocking to larger sized batteries thinking that's really what they want. Or is it?
3. Misunderstood consumers.
Wannabe EV owners want enough range so that they don't have to charge the car any more often than they get gas. Once they realize and accept that it's okay and preferred to charge it nightly, they'll recognize that they shouldn't be paying a premium for a larger battery which is less efficient, takes longer to charge, will cost more to repair/replace, and is of course exponentially more expensive. Consumers aren't going to be dumb for long. They'll come around and realize they don't really drive 200 mi a day and they'll be more accepting of vehicles with lower ranges. For now though, loads of people are craving huge range. The more the better. Until they get smart, the deals will stick around.
4. Consumer confidence will increase and leases returns won't come in such large numbers.
It's no secret that people lease EV's moreso than buy them. It was because of EV's that people started to lease for reasons other than affordability and excitement of switching cars regularly. Many first time leasors do so with an EV. Technology was growing so quickly and there wasn't a lot of confidence in batteries. Although EV's have been around awhile, it's still in its infancy. EV's haven't been around long enough to see a bunch of batteries fail to really know how long they last. As time goes on, people will get more confident in EV's and we'll see an uptrend in purchases over leases which will decrease the inventory of lease returns.
The i3 came out in 2014. Most people know to let the first year slide while the manufacturers work out the bugs. Huge number of leased 2015 models are being released into the market as lease returns. So much in fact that CPO cars are priced competitively with private sales. There's literally no reason to buy a non-CPO unless you found a Mr. Porter, Launch Edition package, Value Package, Value Package +, Shadow Sport, Carbon Edition or any other limited edition model.
5. That PG&E thing is temporary.
PG&E and Edison are/were both offering $10k off new cars. This incentive is making people think twice about buying used. Some people will bite on this offer, creating less demand for the used ones which further increases inventory relative to demand for 2015 cars.
If people pay less for a car up front, they're going to be willing to let it go for less when it comes time to sell (moreso than if they paid full price). When these 2018 models come back into the market as used cars, they'll compete with the other listed cars. I think we've hit our bottom for i3's still under the 4 year warranty (which is a big thing for consumers of EV's) as I've seen some i3's under $15k with MSRP's of $48k. I don't expect to see a spread like that for any other model year that's still covered by CPO warranties.
If you don't know whether you want an i3 or not or are comparing it to any other car, don't get the i3. It's not for you. If you are in love with it, you'll know it and the time to buy is now.
1. Tesla.
People are holding off buying an EV b/c they think they want the Tesla Model 3 (that was me a month ago). Those that don't have it already are waiting for the base model to be released. When that happens, many people will realize they don't want it anymore b/c all the tax credits are gone. These would-be buyers will look for alternatives which will add to the demand on other vehicles, one of which is the i3.
2. There are a number of new EV's coming out.
This will only decrease demand for the i3 as consumers see they have more options than they once had. Once upon a time, the i3 was the fastest EV out there behind the Tesla Model S. That's no longer the case. The i3 also had one of the largest batteries. We see that's definitely no longer the case. And in fact, people are flocking to larger sized batteries thinking that's really what they want. Or is it?
3. Misunderstood consumers.
Wannabe EV owners want enough range so that they don't have to charge the car any more often than they get gas. Once they realize and accept that it's okay and preferred to charge it nightly, they'll recognize that they shouldn't be paying a premium for a larger battery which is less efficient, takes longer to charge, will cost more to repair/replace, and is of course exponentially more expensive. Consumers aren't going to be dumb for long. They'll come around and realize they don't really drive 200 mi a day and they'll be more accepting of vehicles with lower ranges. For now though, loads of people are craving huge range. The more the better. Until they get smart, the deals will stick around.
4. Consumer confidence will increase and leases returns won't come in such large numbers.
It's no secret that people lease EV's moreso than buy them. It was because of EV's that people started to lease for reasons other than affordability and excitement of switching cars regularly. Many first time leasors do so with an EV. Technology was growing so quickly and there wasn't a lot of confidence in batteries. Although EV's have been around awhile, it's still in its infancy. EV's haven't been around long enough to see a bunch of batteries fail to really know how long they last. As time goes on, people will get more confident in EV's and we'll see an uptrend in purchases over leases which will decrease the inventory of lease returns.
The i3 came out in 2014. Most people know to let the first year slide while the manufacturers work out the bugs. Huge number of leased 2015 models are being released into the market as lease returns. So much in fact that CPO cars are priced competitively with private sales. There's literally no reason to buy a non-CPO unless you found a Mr. Porter, Launch Edition package, Value Package, Value Package +, Shadow Sport, Carbon Edition or any other limited edition model.
5. That PG&E thing is temporary.
PG&E and Edison are/were both offering $10k off new cars. This incentive is making people think twice about buying used. Some people will bite on this offer, creating less demand for the used ones which further increases inventory relative to demand for 2015 cars.
If people pay less for a car up front, they're going to be willing to let it go for less when it comes time to sell (moreso than if they paid full price). When these 2018 models come back into the market as used cars, they'll compete with the other listed cars. I think we've hit our bottom for i3's still under the 4 year warranty (which is a big thing for consumers of EV's) as I've seen some i3's under $15k with MSRP's of $48k. I don't expect to see a spread like that for any other model year that's still covered by CPO warranties.
If you don't know whether you want an i3 or not or are comparing it to any other car, don't get the i3. It's not for you. If you are in love with it, you'll know it and the time to buy is now.