Cars are going to be the next bubble

[Optimistic Nick]

Is that on a contract hire Nick?
The residuals on electric cars are high at the moment , that will change as they become more main stream.

We are starting to see electric cars become available to the hire market . That will force residuals down.

Funnily enough, just had a mailshot on the Audi etron . Was thinking maybe change my C63 for one . Maybe next year ..

Yeah but through company car scheme - I get a deduction from taxable pay for hte lease cost, but the BiK is currently nil. It goes up to 1% next year, and 2% after that.

There is a "latest news" section in our company car scheme website where they announce new cars. Of the last 10: 8 have been EVs; the other 2 have been PEHVs.

There are some amazing cars out there and on the way. I actually think the etron is overpriced for what it is now, but it's a bit like buying a computer: something far better is always on the way, and if you wait for the best deal you will never jump on in the first place. At the top end the Lucid Air looks incredible, and the Porsche Taycan has supercar performance for a fraction of the normal price. The BMW iX3 is orderable now and is considerably cheaper than the etron and the BMW iX looks fantastic. But it is the more mainstream cars that I think will change it. I'd almost rather have the Skoda Enyaq than the etron but they won't be available until the summer and the Hyundai ioniq 5 looks amazing, and they are going to comparable in price to normal ICE cars. I think the switchover is going to come very quickly now that ranges are generally well over 200 miles and many far more than that.

[Optimistic Nick]

Don't get me wrong, I can not afford one yet but it is still very early and the early signs look really promising!
The price of batteries has fallen 88% in the last decade, and this trend is continuing.

I think something is going to snap in about 3 years. I am not sure how long the government is going to maintain the tax benefits for electric cars - currently they are effectively an entirely tax-free benefit. If they turn the tap off, everyone is going to hand back the keys and the market is going to be absolutely flooded, which will push down prices in the second hand market. Plus the technology means that stuff is going to become obsolete far quicker? Dunno. But I am hopeful that the gap in cost between electric and ICE will reduce greatly in the coming years.

[chris lee]

I think something is going to snap in about 3 years. I am not sure how long the government is going to maintain the tax benefits for electric cars - currently they are effectively an entirely tax-free benefit. If they turn the tap off, everyone is going to hand back the keys and the market is going to be absolutely flooded, which will push down prices in the second hand market. Plus the technology means that stuff is going to become obsolete far quicker? Dunno. But I am hopeful that the gap in cost between electric and ICE will reduce greatly in the coming years.

In response to the point about technology becoming obsolete, I believe the opposite is happening. If I use Tesla as an example they provide over the air updates to all cars, so one morning you can get in your car to go to work and it will have had a whole software upgrade, much like how an Iphone will get a upgrade.

One such update actually optimized power usage and increased the range of older cars. Imagine getting into your old petrol car one day and your MPG has increased with a free update, that is essentially what is currently possible with electric cars.

[tricks]

Good thread for me. Driving a big diesel but it’s fine for 5 years plus. But do I cash in now and get a leased ID 4 for example ? £300 per month? I’m verging to going electric sooner than later.

[Optimistic Nick]

In response to the point about technology becoming obsolete, I believe the opposite is happening. If I use Tesla as an example they provide over the air updates to all cars, so one morning you can get in your car to go to work and it will have had a whole software upgrade, much like how an Iphone will get a upgrade.

One such update actually optimized power usage and increased the range of older cars. Imagine getting into your old petrol car one day and your MPG has increased with a free update, that is essentially what is currently possible with electric cars.

I mean more the hardware, the batteries etc. Just look at the ranges possible now and compare that to what was available 5 or 6 years ago. And the speed of charging too. In 3 years time, my etron with 200 mile range (at a push) is going to look ancient when its competitors that are just 2 or 3 years younger can do 50% or even 100% more range and charge in half the time.

[tricks]

Isn’t that why leasing electric makes sense at the moment?

[Optimistic Nick]

Good thread for me. Driving a big diesel but it’s fine for 5 years plus. But do I cash in now and get a leased ID 4 for example ? £300 per month? I’m verging to going electric sooner than later.

It looks amazing but I think it is basically the same as the Skoda Enyaq which is cheaper and I think looks fantastic - I actually canceled my etron order briefly to order the Skoda, but the lead time was about 9 months! The Hyundai ioniq 5 looks even better (although I think there is still quite a wait for that) - range of over 300 miles; 0-60 in 5 secs; massive boot; can charge in 18 mins. And it looks like the 1980's vision of the car of the future.

The other one that looks great value and is tried and tested is the Kia Nero. I was also sorely tempted by the MG SUV, but the range just wasn't quite large enough. But that was cheap as chips on my scheme - literally less than the monthly running costs of my existing car even before depreciation.