I have followed Patrick Boyle videos since he began on Uoutube
and while I generally agree with his analysis and opinions, there are some
areas where his short term (YOY) analysis is not representative of the longer term trend.
IMO this is true with respect to his video above.
He is comparing 2023 (last annual data available) with 2022
Re depreciation :
He is taking the depreciation of say a Tesla 3 as being much higher than an Audi Diesel
of similar years. IMO this is deceptive for 2 reasons:
(a) There was a shortage of supply of Audi's due to chip shortages which saw the
pent up demand drive up the price of this car,
(b) He uses the retail price of the EV say (Tesla 3) from which to calculate depreciation;
not the transaction price which is most western markets was by $7500 or 10% of the
. retail price.
He did not compare price depreciation across the board for a one year old car
which in Aus is at lest 25%. Those doing operating lease (fully maintained
car with a guaranteed buy back price allow the highest depreciation rate
of about 25% for year one, 35% for year 2 and 42.5% for year 3 . Diesel 4x4s
is usually less.
So in summary depreciation can be impacted by replacement (new) price
movements (eg the A3 Diesel Audi example which he gave) scarcety,
government tax incentives for new car purchases and Government buying
incentives. fuel/electricity costs ..eg: $7500 on BEVs.....in other words
the overall cost of ownership. By monitoring the resale of EVs PHEVs
& HEVs in the Brisbane market, it becomes evident that about 80%
going through the local auctions are either ex-Gov or ex-fleet who
have different criterion that the average dad & mum owner.
For example Government buys at fleet rates (normally 15% discount
as does national fleet. Then remove GST of 10% and you then end
up with 25% discount vs the transaction price paid by a mug punter
(GST paying fleets and businesses can claim back the GST by
offsetting it against GST on company sales.
So it can be deceptive to cherrypick IMO and in one jurisdiction
where the figures support ones these and then project that globally
ad oif that were to be the universal yardstick.
RE: Hertz.
Before leasing the 30,000 odd Teslas Hertz was in financial strife
and subsequent downturn in business during Covid exacerbated that .
Remember when Budget Rent a Car went burst? there were 1000s
of ex budget vehicles being offered at auction for 2 bob.
Again IMO its deceptive to take a failing Car Rental Company striving
for its existance and comming out of bankruptcy as a paradigm for the global used EV market.
(source NY Times)
Hertz obviously misestimated its market by leasing 30,000 Tesla EVs
at a time when covid was hitting and that the economics of renting an EV
at a premium price for a short distance rental did not stack-up for the
majority of renters . For example to pay $20 USD a day premium for sale a Tesla
3 means at least $17 extra for petrol in an ICE and at US petrol pricing
on the average 4 Cyl ICE car $17 US means an extra 250 kms per day
until it breaks even with a Tesla 3. IMO the average Hertz rental
would be less than 100 kms/day. Knowing Americans, bottom line
is more important than paying a green premium.
So while I appreciate Patrick Boyle's economic commentaries generally,
there are more moving Parts in some areas he addresses.
