Used electric vehicle prices in the United States dropped more than 20% in the last year, opening the door for buyers once deterred by high costs.
Used car prices overall fell 6.8%, but the used EV market in particular underwent “a major course correction,” report experts at the Edmunds online automotive inventory, after prices declined 20.5% year over year from the second quarter of 2023 and 38.5% from Q2 2022.
“This downward trend in values marks an abrupt turn in the trajectory of the used EV market, which had a runup in prices with the introduction of competitive products,” writes Edmunds insights director Ivan Drury. “We seem to have reached a point where used EVs values are succumbing to more mainstream market forces.”
The drop results from a few factors, beginning with a notable uptick in EV manufacturing that has affected supply. Most of the Teslas now on the road were produced only in the last four years, whereas previous years rolled out only a much-hyped trickle of new cars, writes InsideEVs.
But as the demand for new EVs fell short of expectations, manufacturers slashed prices to compete for market space, while a host of tax credits and incentives from the Biden administration’s Inflation Reduction Act pushed new EV prices down even further.
“This news shouldn’t surprise anyone in the automotive industry, as we’ve seen automakers utilize virtually every incentive under the sun to move stale new-EV inventory,” Drury writes. “The trickle-down effect on the used vehicle market has been pronounced.”
Edmunds identifies five EVs that may be particularly good buys at this time: the Chevrolet Bolt EV, Hyundai Ioniq 5, Tesla Model Y, Ford F-150 Lighting, and BMW iX.
But these deals may not last. “Prices are going down and interest rates are coming down—that’s obviously good news,” Baris Akyurek, vice-president of insights and intelligence at AutoTrader, told the Globe and Mail. “But on the other hand, when these things happen, usually demand picks up.”
And “when demand picks up, prices will react accordingly.”
In the United Kingdom, buyers are taking advantage of cheap used EV prices for now, says the UK-based car history checking service HPI, reporting that some used EVs are now cheaper than their fossil-fuelled counterparts.
HPI EV specialist Chris Plumb told Express the rise in EV sales shows that consumers are driven by opportunities to cut car ownership costs.
“The growing availability of second-hand electric models is driving demand as motorists want to reduce their environmental footprint and make significant motoring cost savings due to high diesel and petrol prices,” he said.
But “switching from traditional petrol and diesel motoring to electric isn’t a like-for-like swap,” he added, with access to charging and the end of road tax exemptions in the UK among factors to consider.
