Thursday, December 23, 2010


Buying a LEAF is not rational. Here's why:
  • It never pays to buy a new car You lose too much in depreciation as soon as you drive it off the lot. From a purely economic perspective, the optimal strategy is to buy a 3-year old used car.
  • Never buy version 1.0 of anything The LEAF has a new motor, new battery, new telematics. There are going to be problems with the car, hopefully minor, probably annonying.
  • The cost savings aren't there (yet) With gas at $3.00 per gallon and electricity at $0.11 per KWh, you're basically at par with a Toyota Corolla XLE. On the other hand, if gas goes to $4.00 a gallon and stays there, you'd be ahead with the LEAF to the tune of $2500 after 5 years.
On the flip side, reviews like this drive me crazy:
"Of course, the Leaf and Sierra HD are designed for totally different purposes. Despite all the attention paid to the Leaf’s electric drive train, it is essentially a midsize family car designed for commuting, running errands and weekend getaways. In contrast, the Sierra HD is a workhorse built for carrying work crews and heavy equipment to construction sites..."

How many days per week do you spend "commuting and running errands" versus "hauling heavy equipment to construction sites"? Did you know that Lowe's or Home Depot will rent you a pickup if you really need one?

So why buy a LEAF? Because the idea of an electric car is just so cool. Because life three standard deviations from the mean is much more interesting. And let's face it, no one buys a new car for economic reasons. If you did, you'd buy a bus pass. Or a bicycle.

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