Batteries in electric vehicles generally come with a minimum warranty of eight years/160,000 km. As the EV evolution pushes onward, consumers are seeing what that warranty — or rather, the end of it — looks like in the real world. And some of what they’re discovering is bound to give them pause.
Recent headlines highlighted a Stoney Creek, Ontario man dismayed to discover the cost of a new battery for his 2017 Hyundai Ioniq would be about $50,000. We’ve seen similar reports in recent years, but prepare for an onslaught as those early adopters hit up against their warranties, or in this case, go past it. With over 172,000 km on the car, it was just out of warranty.
When the consumer purchased the used vehicle, it had 69,000 km on it. When told of the gob-smacking 50 grand expense, he opted to instead scrap it. Hyundai Canada has stepped in to give the customer fair market value in cash or towards a new Hyundai, but noted it “was scrapped by the customer before these diagnostic procedures could be completed, precluding a definitive assessment of the required service.”
Hyundai Canada isn’t downplaying what happened. Jennifer McCarthy, National Manager of Public Relations, is clear. “We know we had a misstep in [this] case…that is not in line with our standards for customer service…we are in the process of standardizing practices across our dealer network, specifically concerning battery-related issues, to ensure our customers receive consistent and fair treatment.”
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That $50,000 number came as a line item to the dealership: $44,400 plus taxes. That’s what they were told, that’s what they told the customer. They weren’t out of line; dealers do not control the price of parts. Hyundai Canada is wearing the blame for the communications breakdown because they recognize we’re all — manufacturers, dealers, consumers — on this learning curve together.
How much does it cost to replace an EV battery?
The high cost of replacing EV batteries that are no longer good enough to power those vehicles (they can still be used for other purposes) has been making headlines on both sides of the border for a few years now. A 2014 Ford Focus Electric bought for US$11,000 needing a US$14,000 battery; a 2018 Kia Soul needing a $23,000 battery fix outside of warranty (Kia agreed to pay half); a US$30,000 battery quote for a 2012 Chevrolet Volt, a car worth US$10,000.
The Drive does a good job of educating consumers about expected battery costs. Every manufacturer knows they will have to bridge consumer’s concerns (and invoices) as we transition to EVs. George Iny, executive director of the APA, says “prices for replacement battery modules from the automakers run from $15K (some Leaf models) to about $45K (some Hyundai and Kia models). Bolt and Tesla S & X are just under $30K. The solution before scrapping the car would have been to source a used battery pack from a recycler or locating a shop that could rebuild the original module. Assuming someone does it, the price would be under $10K.”
I asked Chris Muir, automotive consultant and professor at Centennial College to do just that. “Used batteries for that car from a recycler, with up to a one-year warranty are roughly $3,500. The closest one is in Ste. Sophie, Quebec. Call it $5,000 with shipping. The book pays two-and-a-half hours for that battery. If the tech was using book time at a dealer and the door rate was $200 an hour that’s only $500. Add another $500 to $1,000 for odds and sods. Your total is only $6,500 for a used battery with 90 days to a year of warranty from a wrecker. With used, you’re still in that regular powertrain feasibility zone. Hell, a used engine for a Ram 5.7 of the same year starts at $3,750, and quickly goes up from there.”
Car owners outside of warranty frequently seek aftermarket solutions to mitigate costly repairs; it will become easier over time for EV owners to follow suit.
How long should an EV battery last?
The U.S. Department of Energy says that “the advance batteries in electric vehicles are designed for extended life but will wear out eventually… Predictive modelling by the National Renewable Energy laboratory indicates that today’s batteries may last 12 to 15 years in moderate climates (8 to 12 years in extreme climates).” EV batteries rarely experience a total fail.
How does auto insurance work with an electric vehicle?
Canada is an extreme climate. We’re still learning how many things impact that battery life. Insurance companies are already grappling with the costs, as Iny reveals: “Price of a Kia Niro EV: $45,000. Replacement price for the Niro’s batteries following an impact with a metal bar on the road that pierced the battery, causing the loss of its coolant: $52,000. Vehicle a total loss.” There are similar reports with Tesla, Stellantis, Nissan, BMW, and other EVs after a crash.
Owners need to be aware of insurance considerations, as McCarthy points out. “When it comes to expectations around EV battery replacements outside of warranty periods, it’s important to note that the automotive industry, including EV producers like Hyundai, is continuously evolving to meet the unique challenges presented by EVs. while the aftermarket for EV batteries is still developing, consumers should be aware that traditional insurance policies for electric cars typically provide coverage similar to those for ICE vehicles, including liability, collision, and comprehensive coverage.”
She continues: “Most electric car insurance policies in Canada can also offer additional coverage specific to electric cars, such as coverage for the battery pack and charging equipment. It’s advisable for EV owners to consult with their insurance providers to understand the extent of coverage available, especially for high-value components like batteries.”
The aftermarket simply isn’t established yet. While you can shop around for a new battery (or anything else) for your ICE vehicle at dozens of outlets, that’s only possible because technology that has been around for decades has created a market for servicing those vehicles. The EV aftermarket will look very different in even a few years, but right now, consumers have to factor in possible costs once warranty is up.
Dealers are limited in what they can do, but it’s worthwhile to cultivate a good relationship with one, especially on emerging tech.