Electric Shocker: Used EVs Are Now Cheaper Than Used ICE Cars
The average used electric vehicle’s value is down nearly 30 percent year over year
- A new study involving 2.2 million cars indicates that used EVs are cheaper than used gas cars.
- It also appears as though used EV values will continue to fall in the near future.
- On the other hand, gas-burning vehicles are losing value at a slower and more consistent rate.
Electric vehicles were all the rage over the last few years, but the current appears to be flowing in the opposite direction now. In February, used EVs were, on average, $265 lower than used gas cars according to a new study. In May, that price difference grew to $2,657. That marks a seismic shift in pricing trends when compared to last year.
The study in question considered 2.2 million vehicles aged one to five years old sold in May of 2023 and 2024. Notably, heavy-duty vehicles, low-volume vehicles, those discontinued for 2023 and after, and those in production for less than four model years aren’t included. That means that anomalies like the Fisker Ocean don’t affect these figures.
Read: There Are Over 220 Tesla Cybertrucks For Sale In The Used Car Market
According to iSeeCars data, the average used EV is 8.5 percent cheaper to buy than the average used gas car as of May 2024. In terms of dollars and cents, we’re talking about $28,757 versus $31,424. Looking back at the last twelve months, it’s clear that used EV values have tanked. In June of 2023, a used EV cost, on average, 25.1 percent more than a used gas car.
“It’s clear used car shoppers will no longer pay a premium for electric vehicles and, in fact, consider electric powertrains a detractor, making them less desirable – and less valuable – than traditional models,” said Karl Brauer, executive analyst at iSeeCars.
1- to 5-Year-Old Used EV Prices vs. Used Gas Car Prices
Interestingly, gas-powered cars haven’t seen the same giant dip but rather a very consistent pricing trend. Values have dropped between 2.1 and 7 percent in each month year over year. As of May, they’re 6.1 percent less on average than in the same month of 2023.
On the other hand, EV values seem to see almost a third of their value gone year over year. In September of 2023, the average used EV price was 39.1 percent less than in 2022. Now, it’s 29.5 percent down from May 2023.
Year-over-Year Change in 1- to 5-Year-Old Used Gas Car Prices
“While the drop in used EV prices is dramatic, what’s more disconcerting is no indication of used EV values stabilizing,” said Brauer. “At some point used EV prices will have to bottom out, but we don’t appear to be at that point yet.” He believes that ultimately, the change is due to low demand.
“The used car market’s attitude toward electric vehicles shows a dramatic shift over the past year,” said Brauer. “With so many EVs entering the new car market in recent years, and then flowing into the used market, it suggests an over-supply condition that will continue as more EVs come off lease. Without a major catalyst to increase EV demand, used prices for these models will likely keep falling.”
For those interested in a used EV, the time might be right to pick one up if you can handle the depreciation.
