Used electric cars seem to be getting cheaper, a trend observed last year and one that continues into the second quarter of 2024. This price drop was most likely prompted by the massive and aggressive price cuts put in place by Tesla, which also affected the value of used examples, and it looks like the price of used Teslas dictates what other used EVs are worth in the US.
According to a Recurrent report for Q2 2024, 55% of all EVs listed for sale in the US cost less than $30,000. The report also found that over half of all used EVs cost less than $25,000, which makes them eligible for the $4,000 federal tax credit for used EVs. This is three times higher than when the Inflation Reduction Act was implemented, marking a clear downward trend for second-hand electric car prices.
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Used EV prices keep falling
Prompted by the big discounts offered by Tesla and other EV makers, as well as a slowdown in the number of new EVs being delivered, the price of used electric models is on a downtrend.
Recurrent data suggests that the price of a Model 3 over two years old has fallen by 27% year-over-year. It’s higher for a similar Model Y at 31% and even higher still for a Model S at 32% compared to Q2 2023.
Additional findings point to the fact that new EVs are on average $2,000 more expensive than ICE vehicles before the $7,500 federal tax credit. With the big federal discount, it found that price parity between EV and ICE vehicles has already been achieved, although it doesn’t seem to include all EVs on the market, just a selection, so it doesn’t offer the complete picture.
Another study published in early March by iSeeCars found that EVs depreciated almost 10 times faster than ICE or hybrid vehicles from February 2023 through February 2024. It notes that while the average used car price in the US decreased by 3.6% over the past year, the price of used EVs fell by 31.8%.
The used EV with the biggest price drop year-over-year was not a Tesla, though. It was the Chevrolet Bolt EV, which lost 30.4% on average, or a difference of around $7,900. Next up was the Nissan Leaf with a 29.1% drop, followed by the Kia Niro EV with 27.1%. Tesla also saw drops for the Model X, Model 3 and Model S, which lost 24.6%, 24.1% and 20.5%, respectively.
The study found that while in March 2023 the average price of a one-to-five-year-old EV was $43,694, by February 2024, it had dropped to $30,904, which seems to concur with the findings of the other study mentioned in this article. Used Teslas were the cars that lost the most value, up to 28.9%, which is more than twice as much as the second-place carmaker on the list, Alfa Romeo, which lost 13.3% in the same time frame.
Used EV values have shown signs of stabilizing over the last few months, but as manufacturers keep offering discounts on new examples, this will only serve to drive used prices down further. Tesla isn’t the only EV manufacturer offering big discounts; it is joined by Fisker, which has also implemented massive price cuts as it awaits its uncertain future, as well as Lucid, which is offering nearly $30,000 off one of the Airs it has in stock until the end of April.
