A revolting trend: EV battery fraud
Swapped batteries are becoming a growing risk for those seeking used electric vehicles
Interested in an electric car, but finding current prices are a bit too high for your budget? Worry not, as the second-hand EV market is well garnished with a wide variety of appealing zero-emission alternatives.
But while it’s true that an electric vehicle requires less maintenance than a gasoline one — resulting in second-hand models that are in great mechanical shape — consumers must stay on the lookout for a rapidly spreading problem in the second-hand EV market: battery fraud. Here’s what you need to know to avoid being trapped in an EV headache.
What kind of fraud are we talking about?
By battery fraud, we’re talking about batteries that are being replaced by older, degraded models. As demand for second-hand electric vehicles climbs, so does the demand for parts. The EV industry has also seen a rising trend in specialty shops stuffing newer, more potent battery packs in older EVs.
This is the case with Ingenext, a Quebec-based EV specialist located in the city of Trois-Rivières. The company purchases salvaged EVs for parts, but also upgrades older models.
Guillaume André, the founder and president of Ingenext, realized that the Nissan Leaf Plus models he purchased from a U.S.-based auction site didn’t come with their original 62 kWh batteries. After inspection, he noticed that the cars were in fact equipped with degraded 24 kWh units from early 2011 to 2015 first-generation Leafs.
After doing some research, André was able to pinpoint where the fraud had taken place. No, it didn’t come from IAA, the auction site who sold him the car. It came from EV Rides LLC, a specialized shop located in Portland, Ore. EV Rides had kept the healthy batteries for itself before sending the dead LEAFs to auction.
Ingenext paid a little over $20,000 (including shipping) for two useless Nissan Leafs. André was able to contact EV Rides and they initially agreed on some form of compensation. However, after speaking with the company a few times, all communication suddenly ended.
Subsequent attempts to contact EV Rides for this story were unsuccessful.
How this affects you
Fraudulent battery swapping isn’t only happening on salvaged cars, but also on clean, well-running second-hand electric vehicles. What’s even more worrying is that in some cases, the dealership selling you the car isn’t even aware that the battery has been swapped.
In the aftermarket world, healthy batteries are worth a healthy sum. For instance, a 62-kWh Tesla battery can sell from anywhere between $20,000 and $30,000.
Most dealerships are simply not aware of such practices. Additionally, auction purchases are typically done quickly, with very little inspection taking place. And no, there is currently no law that prevents these fraudulent acts from happening.
“The auction has no legal responsibility over the quality of the items sold, so obtaining compensation from a fraud like this is pretty much impossible. We (retailers) end up stuck with vehicles that have very little market value,” André said during an interview.
Daniel Breton, the current president of Electric Mobility Canada, was able to offer some suggestions for this emerging issue.
“I have recently heard of this phenomenon as well,” said Breton. “What I’ll say is that governments need to quickly impose regulations, similar to (the regulations on) rolled back odometers on ICE vehicles, or consumers will once again end up paying the price for these fraudulent practices.”
What to do before buying
The first thing you need to do before signing that cheque is have the car inspected. If possible, try to have the car checked by an EV specialist. They tend to have the proper tools to evaluate battery degradation.
All EV batteries have some form of inscription showing their model number and capacity, but some inscriptions, like the one on a Nissan Leaf, are harder to access since the sticker is located on the top part of the battery. This will require a full removal of the battery unit to properly inspect it, something an EV specialist can do rather easily.
The EV specialist can also connect the car to a computer to access the battery’s state of health. However, André tells us that he has seen situations where the software has been rolled back. In other words, you can have a fully degraded battery, but your car is telling you that everything is fine. The only way to really know what’s going on is by removing that battery and properly inspecting it.
If you think your electric vehicle has been subjected to battery fraud, know that the dealership is immediately responsible even if they didn’t do the swap. As a consumer, you are entitled to compensation or a refund if this applies to you.
““We (retailers) end up stuck with vehicles that have very little market value.”
GUILLAUME ANDRÉ FOUNDER AND PRESIDENT OF INGENEXT