Why Used Electric Cars are a Great Value for Buyers
Used electric cars are becoming increasingly attractive to second-hand buyers, offering better value compared to their combustion engine counterparts. Cox Automotive, the owner of Manheim Auctions, has noted a stabilization in used vehicle prices, particularly for electric vehicles (EVs), which are now generally cheaper to purchase than diesel cars and are not as affected by economic fluctuations as they were in the past.
According to recent data, the average price of a two-to-four-year-old EV sold by Manheim Auctions is currently £15,142, showing a slight increase of 1.1% (£162) from January but a decrease of 6.5% (£1,061) compared to the previous year. This price is significantly lower than the average price of an equivalent diesel car, which stands at £18,619 in February, making EVs 23% (£3,477) cheaper.
While petrol cars are still priced lower than EVs at £13,392 in February (11.6% or £1,750 cheaper), the gap has been narrowing over the past year, with petrol values increasing by 2.4% (£304) month on month and by 4% (£509) year on year. Cox Automotive predicts a significant growth in the used EV market, with volumes expected to increase by 117.5% by 2028.
Despite the advantages of buying a used EV, there are some challenges to consider. The market for used EVs is expected to remain fragmented, as these vehicles are generally priced lower than traditional internal combustion engine (ICE) cars, making it difficult to retain their value. Regulatory pressures, such as VAT charges on charging, changes to benefit-in-kind tax rules for plug-in hybrid electric vehicles (PHEVs), Vehicle Excise Duty adjustments, and the potential introduction of road pricing, may also impact the used electric car market.
However, a survey conducted by Cox and Regit revealed that 69% of drivers are not willing to pay more for an EV over a petrol or diesel alternative. The availability of lower-priced used EVs could be a driving factor in increasing adoption rates. Dealers, who were previously hesitant to sell second-hand EVs due to price volatility, are now recognizing the value of these vehicles, as they tend to sell faster and perform well in the market.
In conclusion, while there may be uncertainties surrounding the used electric car market, the affordability and performance of these vehicles make them an appealing option for buyers looking for a cost-effective and environmentally friendly transportation solution.
