Depreciation of an e-bike

[Kudoscycles]

Some while ago I used flecc's formula to calculate the depreciation costs of an e-bike,comparing capital expenditure and battery types-the calculations have great relevance to AndyB's dilemma over his current £500 replacement battery costs.
Some claim that the depreciation of an electric bike is relatively lower than that of a conventional bike, l have no evidence to support that claim. However, the old adage 'lf you don’t pay it, you can't lose it'!

There is a regular contributor on the forum Pedelecs Electric Bike Community - Latest News who has attempted to put a depreciation percentage against the cost price of e-bikes, the replacement cost of the battery is a dominant factory. He has an example of an e-bike costing £1100.00, with LiMn02 replacement battery cost £500.00. His calculations - example 1.

Example 1 - £1100.00 e-bike, LiMn02 battery £500.00 (2 year cycle life)One year old

Purchase price
1,100.00

Battery value (500.00)
Bike value 600.00
25% depreciation (150.00)
Bike value, after 1 year 450.00
Residual value of battery, 50% 250.00
Value of bicycle after 1 year 700.00

Two year old
Purchase price 600.00

35% depreciation (210.00)

Bike value 390.00

Residual value of battery, 0% 000.00

Value of bicycle after 2 years 390.00


Loss over 2 years £710.00 and you are about to face another £500 replacement battery cost.

Using the same formula, the calculation based upon a typical Kudos cycle, purchase cost £745.00, fitted with LiFePO4 battery cost £237.00 - example 2.

Example 2 - £745.00 e-bike, LiFePO4 battery £237.00 (5 year cycle life)One year old

Purchase price
745.00

Battery value (237.00)
Bike value 508.00
25% depreciation (127.00)
Bike value, after 1 year 381.00
Residual value of battery, 50% 189.60
Value of bicycle after 1 year 570.60

Two year old
Purchase price 508.00

35% depreciation (177.80)

Bike value 330.20

Residual value of battery, 0% 142.20

Value of bicycle after 2 years 472.40


Loss over 2 years £272.60 and you still have 3 years left of battery life with a final battery replacement cost of only £237.00.

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[piotrmacheta]

The tax man has figures for bike depreciation under the cycle to work scheme.

 

[eddieo]

none of the above take account of desirability...surely one of the most important facts re resale value. Have never had a problem selling my bikes, in fact could have sold most of them many time over...transferable warranty good in this respect, as it gives an element of peace of mind

 

[flecc]

none of the above take account of desirability...

My original formula did, the bike's percentage fall by age being adjustable for such circumstances. That doesn't affect the separately calculated battery where desirability doesn't come into it, just the life span.