The typical worth of used electrical autos has dramatically declined over the previous yr, reaching its lowest level in Could 2024 attributable to a mix of a number of market forces.
Traditionally, the typical used EV has been far costlier than the typical used gasoline automotive, however that development has swapped totally prior to now few months. Used EVs are actually changing into cheaper than gasoline vehicles. The gulf is predicted to widen additional within the coming months.
Automotive analysis agency iSeeCars analyzed over 2.2 million one- to five-year-old used vehicles offered between Could 2023 and Could 2024. It discovered that the typical used EV worth is down 29.5% year-over-year. Costs of used gas-powered vehicles have additionally dropped, however solely by a median of 6.1%.
In Could 2024, the typical late-model used EV price $28,767, 8.3% under the typical late-model gasoline automotive at $31,424. These costs spotlight a serious shift from a yr in the past, when the typical used EV price $40,783 and the typical used gasoline automotive price $33,469.
A number of components could possibly be driving down the costs of used EVs. At first of 2024, new IRS guidelines went into impact, making federal tax credit accessible to patrons on the level of sale. As an alternative of ready until the tax season begins, patrons are actually capable of receive tax credit score advantages proper once they stroll into dealerships for a brand new or a used EV, reducing the acquisition costs considerably.
Different components might embrace elevated competitors, falling lithium costs and improved manufacturing.
“There’s no denying the crash in used EV values over the previous yr,” mentioned Karl Brauer, govt analyst at iSeeCars. “We’ve watched EV costs fall between 30-40% since June of final yr, whereas the typical gasoline automotive’s worth has dropped by simply 3-7% in that very same timeframe,” he added.
So which used EV fashions precisely are cheaper now? For starters, one- to five-year-old Tesla Mannequin 3s have been priced at a median of about $37,000 a yr in the past. At this time should you’re fortunate you’ll be able to snatch a used Mannequin 3 up for beneath $29,000. (Costs can fluctuate majorly relying on the age and situation of the EVs and after factoring in state and native subsidies.)
For the sake of comparability, the typical gas-powered used BMW 3 Sequence is priced at $33,245. A yr in the past a used Mannequin 3 price $2,635 greater than a used 3 Sequence. At this time, it’s $4,806 cheaper than the Beemer.
The gulf between premium mid-size electrical SUVs and premium mid-size gasoline vehicles is getting smaller, too. A yr in the past, a used Tesla Mannequin Y went for $39,502 on common. That was $4,570 greater than the typical worth of a used gas-powered BMW X3.
At this time, the value distinction is barely $175. A used Mannequin Y got here in at a median worth of $34,734 in Could 2024, whereas a used X3 prices about $34,559.
The highest ten vehicles within the used automotive market which have witnessed large worth drops year-over-year embrace the Jaguar I-Tempo, Chevrolet Bolt EV, Hyundai Kona Electrical, Kia Niro EV and Nissan Leaf.
Value parity with gasoline vehicles is now not an unattainable goal. Whereas used EVs price a lot much less to buy and run in comparison with used gasoline vehicles, we’re seeing an identical development amongst new EVs. There’s additionally a rising crop of long-range EVs with costs properly under the typical transaction worth of a brand new automotive. With used and new long-range EVs cheaper than ever, we could also be getting near fixing the EV affordability drawback.
