Used EV prices are dropping quickly, and that’s a good thing

Let’s face it. Electric vehicles are getting cheaper, but they’re still expensive, with so-called “budget” models still costing north of $35,000. That, however, really only accounts for new electric vehicles — and it turns out that used ones are getting much more affordable. In fact, a new report suggests that the price of used electric vehicles is falling much quicker than that of gas counterparts.

I get it — the concept can be scary. New EV buyers certainly don’t want to find that their shiny electric vehicles are worth so much less after just a few years. But, in the grand scheme of things, this is actually a good thing.

The numbers

The report from iSeeCars notes that while in June 2023, average used EV prices were 25% higher than used gas car prices, by May 2024, used EV prices were 8% lower. That’s a pretty dramatic change.

When it comes to actual dollars and cents, the average price of a used EV was $265 less than that od an internal combustion engine (ICE) vehicle in February 2024 — and by May 2024, the gap widened to a hefty $2,657. That’s all the way down from EVs being sold for $8,000 more in June 2023.

Why are prices falling?

There are a few potential reasons for this dramatic change — and few of them are as scary as they might seem.

The big one is basically that electric cars are finally becoming mainstream. There are lots of factors that have kept electric vehicle prices up over the past 10 years or so. It’s only in the past few years that electric vehicles have become more accepted. Before that, they were really mostly for early adopters willing to deal with issues around charging, for example. Because of the fact that these cars are so much more common, they’re no longer considered a luxury.

Electric cars now being mainstream for a few years also means that there are more used models out there that aren’t Teslas — and as you can learn in economics 101, more supply usually means lowered pricing, at least if demand remains the same. There are enough used EVs to satisfy a larger portion of buyers willing to buy a used electric car that’s a few years old, and as such, the used EV market is more competitive.

Really, much of this comes down to the fact that electric cars just aren’t the shiny new toys they once were. There are plenty of five, six, or seven year-old Teslas out there, not to mention the Hyundai, Kia, and Ford EVs that are being sold after three or four years.

A buying opportunity

So what does all this mean? Well, it means that if you’re interested in selling your used electric vehicle, you likely won’t get as much money for it. But on the flip side, it also means that those interested in buying a used EV, you won’t have to spend quite as much. That’s a good thing — it means that electric cars will be more widely available to those who have been interested in buying one, but unable to afford it. More EVs on the road is better for the environment, and hopefully, it’ll also push charging networks to more rapidly expand their availability.

There are plenty of places you can find a great used electric vehicle. CarMax is a good example, and at the time of this writing, there were over 800 used electric cars available on the website. Carvana offered even more listings, with over 1,600.

It’s also a good idea to keep an eye on local listings on websites like Craigslist and Facebook Marketplace. There are plenty of car listings on both, and every now and then, you can find a great deal on a great car.

The future