It’s been years since I’ve checked the used electric market, but I’m seeing cars like the Hyundai Ionic 6 or Polestar 2 for low 30s, where as they were in the high 40s or mid 50s new a year ago.
My suspicion is that:
- Normal car depreciation when driven off the lot
- General fear of batteries wearing down prematurely, even if the car has ~10k miles
- Any applicable federal rebates or otherwise have already been claimed and can’t be claimed on used vehicles(?)
Is there any other reason why these drop so quickly? Would buying one be considered foolish in anyway?
As others have said, the tech is evolving rapidly. Batteries are the biggest cost of a new EV and they are getting cheaper and better every year. There’s reasonable estimates we’ll see EVs with 500mi of range on a charge by 2026 for example.
Another thing that hasn’t been mentioned yet was how absolutely bonkers the car market was coming out of the pandemic with the “chip shortage”. There were months to years long wait lists for any type of new car, so if you wanted a car immediately it had to be used. Those wait lists are becoming resolved and the market is stabilizing.
When we went to buy our Ioniq 5 about a year ago, the comparable used EVs were scares and $35-40k compared to $45k for a brand new Ioniq. And our rusty 11 year old ICE car traded in for $6k, way more than it was worth.
Supply and demand.
- A couple years ago, teslas, specifically, had the highest resale value of any car …. When there was huge demand and they couldn’t build enough.
- Now Teslas, specifically, have poor resale value …… now that supply exceeds demand, prices new have been dropping, and Hertz dumped tens of thousands on the used market. Also the rebate means prices of new vehicles compete with more recent used
I don’t particularly think they are going low. However:
- Tesla has been artificially holding resale prices high for a long time. They could only do this when there was very little competition in the second hand market.
- The initial price for EVe is too high. All the manufacturers are trying to recoup R&D costs on one or two models. The cars aren’t worth the initial price and the second hand market corrects for this.
- We’ve been through a period of scarcity due to the supply chain getting screwed during CoVid, so demand couldn’t keep up with supply. Supply is far bigger now. Shortages are largely over and there are far more brands in the market.
What I’m saying is that it isn’t the second hand price being low. It’s that it used to be high for various reasons and the market is correcting. Cue people getting caught out because they didn’t see it coming, and getting vocal about it.
I haven’t looked at the used car market in 5 years, I know that it’s gotten more expensive due to the supply chain, but I’ve bought 3 used EVs over the years, all of them have worked fantastically and all of them were between 38k - 55k new, purchased for 15k-22k off lease. People just hear “EVs are expensive” but don’t take the trouble to actually look for themselves.
Used Nissan Leafs used to be like $7k cars. There are a lot of people who could use a nice, reliable $7k car capable of getting around any city for all practical purposes. But since it can’t go on a Great American Road Trip™, it doesn’t get looked at all.
I’d love to hear more about your experience! What 3 EVs did you buy used and which was your favorite?
I’ve bought Volts and an i3. The Volts were I think 12.5k and 12k and the i3 was 22ish. All 3 have been great but the BMW has a lot more compromises as a long distance vehicle. The Volts have been rock solid and super reliable. We only have one left, but it still reads with its normal rated capacity after 10 years.
Nobody really knows how long such a battery holds out. As it is the major cost factor of an EV, people are reluctant to pay high prices.
While we don’t know the top end yet, we know the average is at least 100,000 miles or every EV manufacturer wouldn’t warranty for that much. And that is just for when the batteries hit 30% degradation, not total failure.
Long term surveys are showing as little as 10% degradation after over 150,000 miles. After over 12 years on the road, less than 5% of old Teslas Model S’s have needed battery replacements. The average lifespan of an ICE car is around 12 years, but less than 8% of EVs built in 2011 have needed a battery replacement and less than 4% of EVs built in 2012 have.
Batteries. People already get range anxiety, bad batteries add to it.
Because they weren’t worth what they cost you in the first place - they’re artificially inflated. Like diamonds.
