Kia Niro EV and Tesla Model Y Earn Top Awards For EV Projected Residual Value
ALG, Inc., the industry benchmark for forecasting future vehicle values, and the analytics subsidiary of TrueCar, Inc., today announced the winners of the 2021 Residual Value Awards (RVA). The awards that caught our attention were those that were awarded for electric vehicles.
Tesla's Model Y crossover earned this award for the Premium EV class. The Kia Niro, one of our very favorite EVs based on our own testing, earned the award for the mainstream class.
The ALG Residual Value Awards recognize vehicles that are projected to hold the highest percentage of their Manufacturer's Suggested Retail Price (MSRP) after a three-year period, an important consideration for car buyers when assessing the total cost of ownership for a particular vehicle. This year's ALG winners have shown strong value in their competitive segments and were chosen from all 2021 model year vehicles on sale in the United States in the Premium and Mainstream segments.
"Residual values are a key indicator of an automaker’s success and really help determine the overall health of a brand or certain model,” said Eric Lyman, Chief Industry Analyst at ALG, a subsidiary of TrueCar. “Consumers who are looking to buy their next vehicle need to take residual values into consideration as they provide insight into the total cost of ownership of a car. New vehicle buyers can get peace of mind that purchasing a vehicle that wins the ALG Residual Value Awards will hold more of its value compared with its peers when it comes time to sell it or trade it in.”
This is the first year that ALG included a premium EV category. We feel that ALG is correct in projecting that the Model Y will have a high resale value. Tesla overall has done well in this regard and there is another aspect of resale value that makes it likely Tesla owners will enjoy a solid retained value for their Model Y. Unlike many EVs, there are no federal tax incentives, and very few state incentives for the Model Y. Tesla has used up its federal tax incentives and most state incentives are capped at $50K MSRP. Nearly all Model Y's sell for more than this price point.
The Niro EV from Kia does enjoy both federal tax incentives, and in states that offer them, rebates. When these are factored out, we feel the Niro will likely retain its value well. There are two main reasons. First, Kia scores above average for durability. Second, we found that the Niro punches way above its weight class when we drove it back to back with the Tesla Model 3 SR+.
Time will tell if ALG's projections are correct. You can view the full ALG projected residual value awards report here.
John Goreham is a life-long car nut and recovering engineer. John's focus areas are technology, safety, and green vehicles. In the 1990s, he was part of an academic team that built a solar-electric vehicle from scratch. His was the role of battery thermal control designer. For 20 years he applied his engineering and sales talents in the high tech world and automotive supply chain market. In 2008 he retired from that career to chase his dream of being an auto writer. In addition to Torque News, John's work has appeared in print in dozens of American newspapers and he provides reviews to many vehicle shopping sites. You can follow John on Twitter, and view his credentials at Linkedin