According to a recent report from Automotive News, Volkswagen will “crack an industry barrier” by offering its used all-electric ID vehicles for lease. Fortunately for those of us in the States, VW plans to include North America in the upcoming strategy.
Volkswagen executives recently shared this information with Automotive News, explaining that it’s a way for the brand to maintain control over its valuable battery packs. The news came earlier this week, directly from VW Group CEO Herbert Diess during talks at the Munich motor show. He pointed out that re-leasing the cars will allow the company to put the battery packs to new uses, such as for fast chargers and home power options. Diess shared via Automotive News:
“In Europe, we are trying to get a second lease and even a third lease, and keep the car in our hands. Battery life, we think today is about 1,000 charging cycles and around 350,000 kilometers [about 215,000 miles], something like that. So, the battery would probably live longer than the car, and we want to get hold of the battery. We don’t want to give the battery away.”
Since EV batteries are expected to last for many years, the battery packs in older used EVs may still be worth a large chunk of change even after the car itself has depreciated significantly. Moreover, Diess believes an EV battery pack’s value could work to keep the car’s residual value high enough that re-leasing will be an affordable option for car shoppers.
Diess went on to say that we have already seen EVs holding their value better than gas cars. Regardless of the condition of the vehicle, unless it’s completely destroyed, there’s still a very valuable battery pack inside that can be reused, repurposed, and/or recycled.
CEO of VW Group of America Scott Keogh added that the brand is already working to implement this plan. He clarified that the residual values could keep VW EVs on the road in various owners’ possession for up to eight years. After that, the cars would be returned to VW so that the batteries can be removed and recycled.
At first glance, this seems like a win for Volkswagen and for EV shoppers as a whole. Head down to our comment section and let us know what you think of this plan. Are there any issues that may arise? Should other EV makers consider following suit?