Electric Car Resale Value Dropping Fast?
Now, buyers have more options. They can choose from various electric car models. This is because the supply of electric cars has increased. It's good news for those who want to switch to electric cars. Additionally, competition among manufacturers has intensified. Therefore, prices of electric cars have gone down.
Car Dealer magazine research reveals that 29 of the 30 worst depreciating used cars are electric models over the last half year.
Electric cars have decreased in auction prices by 33.6% since last December. This is a huge drop compared to diesel cars which lowered by an average of 1.3%, and only 0.5% for petrol vehicles.
Premium electric vehicles can cost a lot. This can lead to a big loss. For example, the Porsche Taycan and Tesla Model X dropped by over £20,000 each.
Before we dive into the reasons why, there are a few things to keep in mind. The data only focuses on cars that are three years old and have average mileage. This means that the newest models aren't included.
The trade figures are the prices dealerships pay at auction. They are not the cost for customers. This will affect the customer's cost. The resale value is important for those looking for a new car.
Why Are Electric Car Prices Dropping?
An assembly line for electric cars. This line manufactures electric vehicles. The process starts with assembling the car frame. Then, the installers add the wheels and other parts. The batteries come next, making the car move. After that, the technicians test all systems. Finally, the cars are ready for shipping. This process reduces carbon footprint. Buy an electric car and help the planet!
There's no single answer to this. It seems like various factors are causing resale prices to drop.
Electric cars have more room for prices to drop compared to their fossil fuel counterparts. The gap between the prices can be around £10,000. Therefore, the percentage drop in price can seem greater.
Next, we need to consider the issue of supply and demand. In the last couple of years, lots of people have been wanting electric cars, but there aren't enough to go around, so people have to wait a long time to get them. This is because there are more people who want eco-friendly options than there are cars available.
It's not true anymore. Factories have caught up. You can now buy new models today.
"New" is a big deal. The cars listed are three years old, so people might have bought used ones before. But now, they don't have to.
Battery tech is getting better. This makes people question if buying an older electric car is worth it. Newer models can go farther on one charge.
Energy prices are rising. Electric cars are having trouble. This is a false economy.
EVs used to cost more upfront than petrol or diesel cars, but their low running costs made up for it. However, the war in Ukraine has caused energy prices to drop, meaning that EVs may not be as cost-effective as they once were.
Some incentive programs from the government, such as the Plug-In Car Grant, are ending. This could be why people are losing interest in EVs. The ending of these programs adds to the cost of owning an EV.
Tesla's recent price reductions have influenced the used car markets. Electrifying.com editor Tom Barnard shared this observation with Car Dealer magazine. The impact of Tesla's cuts should not be overlooked.
Owners and traders started getting scared of losing money. Residuals went down. That affected the worth of other cars too.
Electric cars are not keeping their value well lately. Many things are affecting the resale price. It's not a shock that this is happening.
Is The Future Still Bright?
At first, the Tesla car needs to be charged. The charging process can take several hours. The car is plugged into a charging station. Electricity flows into the car's battery. The battery stores the electricity. Once fully charged, the car can be driven again.
It may seem bad for electric vehicle supporters, but there are positive aspects that are not mentioned.
Electric cars used to be expensive, but now they're getting cheaper.
The UK will stop selling new petrol and diesel cars within 7 years. This will increase the use of electric cars. Charging stations for electric cars will improve as well.
Many people hesitate to buy old models as technology improves quickly. This shows how innovative the industry is and how much it's improving. VW's partner claims they have a battery that can go up to 1,000 km in range. This is double what most EVs can do now and should help with charger anxiety for long trips.
Rowan Atkinson wrote an article for The Guardian. He is an actor, comedian, and car enthusiast. His article talks about the environment. He thinks the best is yet to come. The article was popular and shared widely.
Atkinson said solid-state and hydrogen batteries and synthetic fuels can be useful. He said he felt fooled by early environmental benefits. Despite this, he is optimistic about the future.
He wrote that electric propulsion will help the environment globally. But this won't happen yet.
Which EVs Depreciated In Value?
Cap HPI reports that these are the top 5 cars that have experienced the greatest decrease in prices over the past 6 months. The decreases have been measured by percentage drops.
