It’s bad news for early adopters, but good news for those who are impatient for EV prices to come down to a more affordable level. A new report from the National Association of Auto Dealers (NADA) predicts that values for used plug-in vehicles are expected to decline nearly 30% this year – the highest depreciation rate of all vehicle segments.

For example, according to the NADA Official Used Car Guide, average trade-in values for the 2011 Chevrolet Volt and Nissan LEAF fell by a combined average of nearly $10,000 between May 2012 and May 2013. As a percentage of MSRP, the Volt retained only 49% of its value and the Leaf retained 42%. By comparison, a 2011 Toyota Prius retained 63% of its value, and a 2011 Chevrolet Cruze 62%, over the same period.

NADA estimates the annual rate of depreciation for plug-ins will improve little over the next two years, with annual losses going from 31.5% in 2012 to 29.7% in 2013 and 27.4% in 2014.

“The steep rate of depreciation for used plug-in electric vehicles can be attributed to limited range, manufacturer incentives and federal tax credits,” said NADA analyst Jonathan Banks. “Generous tax credits can certainly promote more new sales than would have been achieved otherwise, but they also have a negative impact on future resale values for one basic reason – few consumers are willing to purchase a credit-ineligible, used plug-in electric vehicle for more than they would pay for a new one, less the federal tax credit, so at a minimum, late-model used plug-in electric vehicle prices must logically max out below the manufacturer’s suggested retail price minus the credit.”

Source: NADA Used Car Guide