A forecast residual value of 20% for the first fully electric van, at 3yrs/30,000 miles, reflects conservative views in the trade over the future prospects for used electric vans, says CAP.
The forecast for the Azure Dynamics Transit Connect is published in the latest edition of CAP Monitor – Future Residual Values for Commercial Vehicles, the independent industry benchmark for forecast used prices.
However, the majority of these vehicles are expected to be leased by Ford, which is working against an assumption of a 0% residual value forecast.
The Azure Dynamics Transit Connect, launched into the UK market this summer through a small network of selected Ford commercial dealers, is the result of collaboration between Ford and Canadian company Azure Dynamics.
With a new list price of £39,999, the van is forecast to retain a value of £8,000 after 3yrs/30,000 miles - 20%, while a long wheel base Transit Connect Trend spec diesel equivalent has a residual value forecast of 33%.
CAP has been at the heart of debate during the past 12 months around the commercial issues surrounding electric vehicles in general and has been consulted by many manufacturers and organisations around the industry seeking to make a success of their first steps into this embryonic sector.
In the light commercials market, however, CAP’s opinion has been that the commercial viability of electric vans remains fraught with uncertainty, especially for second users. One of the major issues has been the still largely unknown potential for the need to replace expensive battery packs. The prospects of persuading second users to pay a premium for technology that remains in its infancy remain slight, in CAP’s view.
CAP Commercial Vehicle Monitor editor Tim Cattlin said: “We have no wish to dampen enthusiasm for any new development in the light commercial vehicles sector but at this point the prospects for all-electric vans are fraught with difficulties, despite the clear operating advantages of using one for specific kinds of work.
“We are looking to the future and a typical trader’s willingness to risk purchasing such a vehicle for stock. At this point it seems unlikely that the risk around battery life alone will be considered reasonable until a real track record of reliability has been established, along with a clear understanding of battery longevity.
“Another serious sticking point is the risk to an end user of having to spend several thousand pounds additionally on a replacement battery pack on a 5 to 10 year old vehicle.
“Our current residual value forecasts are therefore conservative, having taken all of the relevant factors into account. However, our minds remain open and as more market experience is gained the industry can rest assured we are closely monitoring for everything that can be learned about this new emerging sector.
“We also recognise that although these vehicles are likely to cause sleep loss for a fleet manager, to the marketing director of an environmentally conscious business with a proactive desire for a pioneering green image, their value is not entirely tied to the balance sheet.”
Read our review of the Azure Dynamics Transit Connect.