- Insurers scrap EVs at half the rate of ICE vehicles
- EV repair costs are 29% higher than ICE vehicles
- Lack of trained EV technicians poses industry challenge
A new analysis has revealed that insurers are writing off and scrapping electric vehicles at a rate that is half that of petrol and diesel automobiles.
A series of reports indicate that insurers are disposing of electric vehicles (EVs) at an alarming rate due to the unrepairable harm that minor collisions are allegedly causing to the batteries.
Although the most recent report indicates that the write-off rate is significantly lower than anticipated, the current average repair costs for electric vehicles (EVs) are considerably higher than those of conventional internal combustion engines (ICEs).
In response to inquiries from various sectors of the automotive industry, Cap Hpi, an automotive data company, has analyzed DVLA data to determine whether electric vehicles are being written off at a higher rate than internal combustion engines.
There is ‘conclusively no evidence’ to support the theory that battery-powered cars are scrapped at a higher rate than ICE models,” it was stated.
The study discovered that 40 electric vehicles (EVs) were discarded out of the 334,525 cars on the road last year, which accounts for 0.01% of the total. This information pertains to vehicles that are less than one year old.
This contrasts with the 701 of 2,026,146 ICE vehicles (0.03 per cent).
In 2023, 782 (0.09 per cent) of 912,341 electric vehicles (EVs) were discarded, while 10,300 (0.18 per cent) of 5,788,617 petrol and diesel vehicles were scrapped when the age of cars was extended to three years.
Lastly, official records indicate that 1,433 (0.13%) of 1,130,581 EVs were compelled to be discarded, while 33,700 (0.33%) of 10,278,745 petrol and diesel models were scrapped. This information pertains to motors that are up to five years old.
Jonathan Clay, the director of cap hpi identification, emphasizes that the report underscores the critical necessity for industry and consumers to understand emergent trends accurately as the electric vehicle market evolves.
The cost of repairing electric cars is higher.
Numerous reports in the past year have asserted that EV write-offs are significantly more prevalent than they actually are. However, the data contradict these assertions.
According to a March 2023 investigation by Reuters, insurance companies are under increasing pressure to permanently remove electric vehicles from the road following minor collisions, which is raising premiums.
The report cautioned that battery packs that have been dented or mildly damaged ” accumulate in scrapyards in certain countries.” Experts have stated that the costly batteries in Tesla Y SUVs have “zero reparability” due to their status as a structural component of the vehicle.
Additionally, Thatcham Research, a UK-based automotive risk intelligence company, conducted additional research last year that cautioned that electric vehicles (EVs) are more costly to repair, require more time to be repaired, and are more frequently written off due to battery damage.
The Impact of BEV [Battery Electric Vehicle] Adoption on the Repair and Insurance Sectors report, published in July and funded by Innovate UK, the government’s innovation agency, asserts that road collisions involving an electric car are frequently “catastrophic for the vehicle.”
This is due to the “concerning lack of affordable or available repair solutions and post-accident diagnostics,” which frequently results in the dismissal of electric vehicles as uneconomical to be reintroduced to the road.
This is most frequently the case when the high-voltage battery pack has been damaged in a collision. Insurers often determine that the cost of repairing or replacing electric car batteries exceeds the vehicle’s total value when injured, even though they account for a significant portion of the vehicle’s original value.
The study indicated that the cost of replacing EV batteries varied significantly depending on the model, even though the procedure is exceedingly costly regardless of the vehicle.
According to Thatcham Research, a new battery for a premium electric car, for example, costs approximately £29,500. This exceeds the cost of a new petrol Volkswagen T-Roc SUV.
The average battery replacement cost for “budget-friendly” electric models is estimated to be £14,200, which is higher than the cost of a Dacia Sandero, the most affordable car in Britain.
Solera, the parent organization of Cap HPI, which specializes in vehicle lifecycle data, reports similar findings.
The results of the analysis of approximately 92,000 global repair estimates for vehicles between January 2021 and August 2023 were published in November.
The most significant discovery is that the global average of EV repair costs is 29% higher than that of ICE vehicles.
“Unlock your financial potential with free Webull shares in the UK.”
This is primarily due to the fact that EV parts, including components such as high-voltage batteries and control units, are, on average, 48% more costly.
In reality, EV battery systems are the most expensive vehicle components, surpassing the cost of components such as headlamps.
Additionally, it determined that specific components, particularly rear bumpers, have a significantly higher replacement rate in electric vehicles than in internal combustion engines.
Jonathan Clay of Cap Hpi emphasized the significance of comprehending the effect on scrappage rates, as repair costs for EVs are up to 29% higher than those of ICE vehicles, according to a Solera study.
The sector is also confronted with a significant challenge: a need for more technicians who are adequately trained to service electric vehicles.
The Institute of the Motoring Industry’s most recent forecast indicates that there will be a shortage of 30,000 EV-qualified mechanics by the time the prohibition on the sale of new ICE vehicles is implemented in 2035.
