EV batteries are holding up much better than many people expected, but the industry is realizing that the battery condition and resulting expected range are critical variables, said Scott Case, CEO at Recurrent.
Photo: Bobit file photo
Black Book introduced Jan. 23 the industry’s first electric vehicle (EV) valuations, dubbed Battery Adjusted Values, which incorporate battery condition adjustments based on data from Recurrent, an authority in EV analytics.
Using battery conditions derived from vehicle-specific information and battery data from thousands of similar vehicles from Recurrent’s database, Battery Adjusted Values will apply an additional increase or decrease to Black Book’s widely circulated VIN-specific valuations.
This is a key milestone because used EV values to date are shaped by criteria from the combustion engine era, prioritizing metrics like odometer readings that are easily accessible, but do not directly reflect battery aging.
The battery is the most expensive part of an EV, and its condition impacts maximum vehicle range. Over time, all EV batteries degrade naturally in their capacity, although the rate varies widely based on battery chemistry, manufacturing processes, and how each vehicle was charged and cared for after its initial purchase.
Until now, critical information about battery condition has not been accounted for in used EV values.
“While electric vehicles are still vehicles, a single component — the battery — has never played such a significant role in a used vehicle’s value,” said Jared Kalfus, president of Black Book, in a news release. “Recurrent has the most comprehensive and actionable EV data available [than can] translate their battery ratings into value adjustments for our customers. It is the next, logical step in our ongoing mission of VIN-specific precision.”
EV Battery Adjusted Values Customer Segments
Battery Adjusted Values will first be available in Cherry, one of the industry’s leading mobile and desktop applications, in late January, and they will soon be rolled out across the entire Black Book portfolio, providing access to all Black Book customers:
- Auctions and remarketers can set reserve prices and increase transparency by combining battery adjustments with Recurrent’s battery condition reports.
- Commercial fleets can determine the optimal resale time and accurately set prices on remarketed EVs.
- Lenders, insurance companies and extended warranty providers can use battery adjustments to accurately model the underlying asset value, and likely resale value, of their portfolio EVs.
- OEMs and leasing companies can use this information for setting residual values of leases, by analyzing the change in battery condition and value over time.
“EV batteries are holding up much better than many people expected, but the industry is realizing that the battery condition and resulting expected range are critical variables,” said Scott Case, CEO at Recurrent. “Buying, selling, leasing, owning or covering an EV without considering the battery is like valuing a combustion engine vehicle without knowing the odometer.”
Early analysis shows that battery transparency increases the average value of used cars. This may not be surprising since 94% of EVs evaluated by Recurrent have a Range Score of 90 or above.