You bought your shiny electric vehicle thinking you’d made the smart, future-proof choice. Two years later, when you’re ready to upgrade, reality hits hard: your EV has lost nearly half its value. Welcome to the electric vehicle depreciation crisis that nobody warned you about.
Table of Contents
The Shocking Numbers: EV vs Petrol Depreciation
Investment banker Sarthak Ahuja recently dropped a truth bomb that’s making waves across the automotive world. Here’s what your vehicle is really worth after two years:
| Vehicle Type | 2-Year Depreciation | Remaining Value |
|---|---|---|
| Electric Vehicles | 42% loss | 58% of original price |
| Petrol/Diesel Cars | 20% loss | 80% of original price |
Read that again. Your electric car is depreciating twice as fast as a traditional fuel vehicle. That’s not a rounding error—it’s a fundamental problem threatening EV adoption worldwide.
The Real Culprit: Your Battery’s Dark Secret
Before you blame the entire electric vehicle concept, understand this: the villain in this story isn’t the car—it’s the battery. And here’s why it’s causing such chaos in the resale market.
EV batteries account for 30-40% of a vehicle’s total cost. Imagine buying a house where the foundation might be perfect or completely compromised, but you have no way to check. That’s exactly what used EV buyers face today.
The Smartphone Parallel Nobody Talks About
Ahuja draws a brilliant comparison to early smartphone markets. Remember when people refused to buy used iPhones because battery health was a complete mystery? You’d hand over cash, and the phone would die at 30% battery by evening. That fear kept the used smartphone market sluggish for years.
We’re living that exact nightmare with electric vehicles—except we’re talking about vehicles costing thousands of dollars, not hundreds.
Why There’s No Simple Battery Health Check
Here’s the frustrating reality: there’s no standardized battery health meter across the EV industry. Every manufacturer uses proprietary software, creating a Wild West situation where buyers are essentially gambling.
Think about it:
- Tesla uses its own diagnostic system
- Nissan has different metrics
- BYD follows another standard
- MG operates on separate parameters
It’s like every hospital using different blood pressure measurements. How would you know if you’re healthy or at risk? You wouldn’t—and that uncertainty kills resale value faster than any battery degradation ever could.
The Obsolescence Accelerator
There’s another twist in this tale: EV technology is advancing at breakneck speed. A two-year-old electric car isn’t just slightly outdated—it can feel genuinely obsolete.
When a 2023 model offers 300 km range and the 2025 version delivers 500 km, suddenly your “almost new” EV feels ancient. Petrol cars don’t face this problem because combustion engine technology has plateaued. An engine from 2023 performs nearly identically to one from 2025.
Three Critical Questions Before Buying
If you’re considering an EV purchase, Ahuja recommends asking manufacturers these essential questions:
1. What’s the battery warranty policy? Does it cover capacity degradation, or just catastrophic failure? Big difference.
2. How is battery health measured and reported? Can you access detailed diagnostics, or just a vague percentage indicator?
3. Is there a certified pre-owned program? This could be your safety net, offering verified battery health and extended warranties.
The Certified Pre-Owned Lifeline
Ahuja’s advice? “Maybe get certified pre-owned to be safe.” This isn’t just cautious banking talk—it’s practical wisdom.
Certified pre-owned EVs undergo manufacturer inspections, including battery health assessments. You’re paying a premium, but you’re also buying peace of mind and protecting your future resale value.
What This Means for Your Wallet
Let’s do the brutal math. If you buy a ₹30 lakh EV today:
- After 2 years, it’s worth approximately ₹17.4 lakh
- You’ve lost ₹12.6 lakh in value
Compare that to a ₹30 lakh petrol car:
- After 2 years, it’s worth approximately ₹24 lakh
- You’ve lost ₹6 lakh in value
That’s a ₹6.6 lakh difference—enough to buy a decent used car outright.
The Road Ahead
The electric revolution isn’t stopping, but the depreciation crisis demands urgent solutions. Until manufacturers adopt standardized battery diagnostics and transparency improves, EV buyers need to enter this market with eyes wide open.
The battery isn’t just powering your car—it’s the single biggest factor determining whether your “investment” becomes a financial sinkhole. Choose wisely, ask tough questions, and maybe, just maybe, let someone else take that initial 42% hit.
