Why Does Nissan Leaf Depreciate So Much?

If you are on the market for a used EV, you may have seen that used Nissan Leafs are very cheap. These deals are too good to be true. 

We have analyzed more than 800 used Nissan Leafs price [source 1]. This is our conclusion — You can buy a 5-year-old Nissan Leaf at almost 70% discount. For example, in 2020, you can buy a 2015 Nissan Leaf for $7,000. When this 2015 model came out, its price was around $30,000 without any government incentives. That’s an enormous depreciation.

This has a few implications. One, if you want to buy a new Nissan Leaf, remember that after 5 years, your Leaf would lose almost 70% of its value. Two, though Nissan Leaf is a great car and requires very few maintenances, in the long run, you are losing money in the form depreciation. 

In this article, we are going to talk about the key factors behind the Nissan Leaf’s enormous depreciation.

Poor Range:

Up to 2017, A Nissan Leaf could go only 70-100 miles depending on models on a single charge. Only in 2018, Nissan has started offering 150 miles range Nissan Leafs. Nowadays, a 70-100 miles range for an EV is absurd. For city driving, it may be okay, but for road trips, it is impractical. 

In a real-world scenario, you can’t even reach this EPA estimated range. For example, you would lose range if you have turned A/C or heater on. A Leaf gets less mileage on highway speed than city speed — however, this is true for all EVs. Battery temperature also plays a role in EVs. For example, in a colder climate, you would lose your EV range.

So, this real-world low EV range makes a Nissan Leaf very unappealing.

Battery Degradation:

In the above section, we talked about the insufficient range of a Leaf. What we did not talk about is its battery degradation over time. 

Nowadays, every EV is powered by a Lithium-ion battery. Every EV manufacturer on the market uses a “battery temperature management system” to control the temperature of the Lithium-ion battery except Nissan. Some company uses liquid-cooled battery such as Tesla, other uses air-cooled battery. If needed, a company like Tesla also uses a heater to raise the battery temperature in cold weather to optimal operating temperature. But Nissan Leaf has nothing. No battery temperature management system. This is a significant design mistake. Nissan still refuses to recognize and fix it.

A lithium-ion battery performs best at around 70 Fahrenheit (21-degree Celcius). A hot or cold battery will perform poorly.

When we drive on highway speed, recharging the battery or on a hotter climate, the battery temperature will rise significantly. If the battery temperature is not controlled, the battery will degrade faster. Though every EV battery deteriorates over time, this uncooled battery will degrade dramatically. Nissan Leaf does not have any battery cooling system. As a result, Nissan Leaf’s battery deteriorates very fast over time.

EVs Lithium-ion battery also performs poorly in cold temperatures. To run the EV efficiently, you need to raise the battery temperature slowly to optimal temperature. Too dramatic battery temperature rise would damage the battery. Nissan Leaf does not have any battery heater either. 

Let’s look at an example. Have you ever used a Samsung smartphone? Samsung makes a great phone, but it has one major problem. Their phone becomes very hot pretty quickly, especially when playing games or running an app that does processor-intensive work. This phone becomes very slow until you cool it down. The opposite also true. Your phone will lose battery charge very quickly if the phone becomes very cold. For example, if you are camping on a cold night, you will experience it.

Because of this lack of battery thermal management system, Nissan Leaf’s battery degrades faster compared to other EVs on the market. The low range, coupled with high battery deterioration, makes Nissan leaf more unappealing.

High Battery Replacement Cost:

Even a few years back, the battery replacement cost of a Nissan Leaf was decent, around $5,500. However, Nissan has raised the price recently. Now, it costs around $8,500. Spending this amount of money on a used car is ridiculous. The whole argument — Nissan Leaf is a low maintenance vehicle — crumbles if you consider the battery replacement cost.

Boring Design:

Compared to other EVs on the market, Nissan Leaf’s design is very mundane. It’s one of the most boring looking vehicles on the market. As a result, the old Leafs does not have any demand. This also drives down the resale value of this car.

EV incentives:

Sometimes the price of a new Nissan Leaf with federal and state incentives is almost similar to a used Nissan Leaf, that needs a battery replacement. Moreover, the new second-generation Leaf has more range — 150 to 200 miles — than the first generation Leafs.

The Story of Nissan Leafs Sales Numbers 2010-2019:

Here is a table of Nissan Leafs sales numbers by year. 

YearNissan Leaf Sales Number
201019
20119,674
20129,819
201322,610
201430,200
201517,269
201614,006
201711,230
201814,715
201912,365
Nissan Leafs Sales Number 2010-2019

We see that Nissan Leafs sales grew steadily from 2010 to 2014. Since 2014 its sales number is dropping like a stone. Every year EV adoption is overgrowing, but Leafs sales are going down. It means not only you, but a vast majority of people are buying an EV from other manufacturers. Though there are thousands of happy Nissan Leaf owner, everyone’s need and expectation is not same. The falling sales number tells that Nissan Leaf is losing its popularity among the buyers. As an EV buyer, you should keep this in mind. If you buy a Leaf today, maybe after 5 years, it could be harder for you to sell your used Nissan Leaf.

Conclusion:

In conclusion, because of the limited range, high battery degradation coupled with high battery replacement cost makes Nissan Leaf an undesirable vehicle. Most of the buyers don’t want a mundane looking EV anymore. This hurts the used Nissan Leaf market. Because of this lack of demand Nissan Leaf depreciate so much.

Frequently Asked Questions About Nissan Leaf:

Does Nissan Leafs hold their value?

Unfortunately no. Nissan Leafs does not hold its value at all. A newly purchased Nissan Leaf would lose almost 70% of its value over 5 years. This makes Nissan Leaf the most depreciated electric car on the market.

How long do Nissan LEAF batteries last?

Nissan Leaf’s battery lasts a long time, but it will degrade very quickly compared to other EVs on the market. Because of this battery deterioration, you would lose range over time. This will make the Leaf unusable after 6-7 years with the original battery.

Is buying a used Nissan Leaf a good idea?

You can buy a used Nissan Leaf with an almost 70% discount. If the battery is in good condition, there was no accident; if you are not going to take a road trip in this Leaf and low EV range does not bother you, then it’s not a bad idea to buy a used Nissan Leaf. However, you won’t get any government incentives for a used EV purchase.

How much does it cost to replace the batteries in a Nissan Leaf?

Nowadays, the cost to replace the batteries in a Nissan Leaf is around $8,500, including labor up from 5,500. 

Why does Nissan Leafs lose value?

Because of poor range, high battery degradation coupled with high battery replacement cost, and boring design makes Nissan Leaf an undesirable vehicle. So, the majority of the people don’t want to buy a used Nissan Leaf. This hurts the resale value, thus making a used Nissan Leaf very cheap.

References:

Source 1: https://www.carfax.com/Used-Nissan-Leaf_w536