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The serious problem of the electric car that they are not telling you and that is making insurance more expensive

The complexity of battery systems, coupled with the lack of cooperation from car manufacturers, is causing insurers to write off many lightly damaged electric cars.

We tend to think that the cost of acquiring a vehicle is basically what it costs. However, there are many more costs associated with it that must be taken into account because, whatever the car, it needs a maintenance.

Included in this ‘extra expenses’ package is the surethe cost of which varies enormously depending on the type of vehicle and model to be insured, regardless of whether the coverage is for third parties or full risk.

Well, it seems that have an electric car ownership may become a problem in the near future if the trend that Reuters has detected is maintained over time.

Impossible to repair batteries

The problem in question is that, for some time now, numerous good battery packs that are impossible to repair. And not because insurance companies have a preference for running away from problems and declare more claims than they should.

No, in this case the problem is posed by the car manufacturers themselves, who in practice make it impossible to repair batteries after accidents, even if they are minor.

Repairing electric car batteries has become a pipe dream for insurers.

“We are buying electric cars (EVs) for sustainability reasons,” says Matthew Avery, director of research at automotive risk intelligence firm Thatcham Research. “But an EV is not very sustainable if you have to throw the battery after a minor collision”.

This, in addition to negatively affecting the much-needed circular economy, poses a serious problem for the owner. And it is that, not in vain, battery packs can cost tens of thousands of euros and represent up to 50% of the price of an EVoften making them uneconomical to replace.

Why can’t batteries be repaired?

The problem lies in two main ways: manufacturers build cars in such a way that it is very difficult to access the batteries and, furthermore, they refuse to share the diagnostic data that allows repair companies to do their job.

Although manufacturers like Ford and General Motors They have already ensured that they are making battery packs much more accessible and easy to repair, others like Tesla are going the opposite way.

In fact, the Tesla Model Y manufactured in Texas already incorporates structural batteries with “zero repairability”says Sandy Munro, director of Munro & Associates, a consulting firm for automobile manufacturers.

According to data collected by Reuters, there are many car manufacturers who see how their models are left without repair for this reason, both in Europe and the United States.

More expensive insurance for electric cars

Insurances intended to cover electric vehicles are generally more expensive, but this situation is making premiums are further revised upwards.

Own Elon Musk complained that insurance was too expensive, but he stopped short of saying that some of his methods were to blame. Of course, Tesla already offers its own insurance at prices below the market average.

According to the Policygenius agency, the average monthly payment for electric vehicle insurance in the United States in 2023 is $206, 27% more than for a model with a combustion engine.

According to Bankrate, an online publisher of financial content, US insurers know that “even if a minor accident damages the battery pack… the cost of replacing this key component can exceed €15,000.”.

In fact, a replacement battery for a Tesla Model 3, which retails for around $43,000, can cost up to $20,000.

Andy Keane, AXA’s UK product manager, says that expensive replacement batteries “can sometimes make replacing a battery unfeasible.” And it is that, if an insurance company cannot access the data of the batteries, “You’re not going to take that risk because then you’re going to face a lawsuit if something happens to that vehicle.”admits.

Sustainable mobility? Depends

Another problem derived from the impossibility of repairing existing batteries is the one that affects the inherent sustainability of electric mobility.

In addition to being impossible to launch the much-needed circular economydisposing of an electric vehicle at an early stage of its useful life means that its lower environmental impact compared to a combustion vehicle disappears.

“If you throw away the vehicle at an early stage, you have lost almost all the advantage in terms of carbon dioxide emissions”recalls Christoph Lauterwasser, Managing Director of the Allianz Technology Center.

In many cases, accidents that do not seriously affect the batteries end up with the cars being scrapped.

At Synetiq, the UK’s largest sector company, chief operating officer Michael Hill says that over the past 12 months the number of electric vehicles in Doncaster’s isolation bay, where they need to be checked to avoid the risk of fire, it has shot up from maybe a dozen every three days to 20 a day. “We have seen a really big change and it is in all manufacturers”.

The recently adopted European Union battery regulations do not specifically address battery repairs, but called on the European Commission to encourage standards for “facilitate maintenance, repair and reuse”has indicated a source of the Commission.

Insurers claim to know how to fix the problem: have manufacturers make batteries in smaller sections or moduleswhich are easier to repair, and which open diagnostic data to third parties to determine the health of the battery cells.

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