Manheim is developing a detailed condition report for electric vehicle batteries.
The move comes as the auction company anticipates handling more EVs at wholesale, said Grace Huang, president of Cox Automotive’s inventory solutions group.
A condition report that accurately gauges battery life could help shore up auction values for used EVs.
“It doesn’t matter how many miles are on it,” Huang said of EVs. “That’s not relevant in the resale market. It all comes down to how many charge and discharge cycles you have.”
Huang told Automotive News that Manheim is working with an unnamed automaker in developing the condition reports, which will be released later this year.
A key step is determining what range is left on a used EV’s battery.
“That’s our first goal,” Huang said. “If you have a [Nissan] Leaf with 80 miles versus a Leaf with 150 miles, a dealer’s going to purchase that Leaf with 150 miles very differently than 80.”
At the moment, dealers — and valuators — are largely in the dark on how an EV battery has been used over its life cycle and what kind of longevity remains. That has hurt EV prices at wholesale.
“People are just discounting,” Huang said. Used EVs nonetheless sell “because they’re selling at a massive discount.”
Cox is betting a detailed battery report would reduce the discounting and depreciation of EVs in general.
Cox Automotive President Sandy Schwartz said it’s a matter of the industry adapting to the coming wave of EVs.
“We have to figure out the next world,” he said. “… The whole marketplace counts on us to value cars. Tomorrow, it’s going to be a chassis and a battery.”
EVs represent about 2 percent of the total vehicle market, Schwartz said, and that share is even smaller at wholesale. “Ten years from now, that’s going be in the double digits,” he said. “How much are those cars going to be worth?”
