Falling prices for used EVs boosts demand in January

Demand for used electric vehicles (EVs) increased in January as a result of falling prices.

Used EV prices fell by 15.3 percentage points between October 1, 2022, and January 31, 2023.

The price crash was amplified when Tesla slashed the prices of its Model 3 and Model Y by up to £8,000. The move, announced last month, is expected to help it compete in an increasingly competitive EV market in the UK.

Shortly after the announcement, Cap HPI revealed that used EV values are declining four times faster than their diesel-powered equivalents.

Despite the increase in sales, data from Indicata shows used EVs are still taking twice as long to sell as used hybrids and even longer than used ICE cars.

EVs accounted for just 5.0% of UK used sales in January compared with 46.0% for petrols, the most popular fuel type, 37.3% for diesel and 11.7% for hybrid.

“Just as three to four-year old EVs were coming back into the market the level of younger cars being recycled by OEMs and their dealers increased. Simultaneously, the cost of living was rising quickly, and consumers couldn’t justify paying two to three times as much for a used EV as an ICE car,” explained Jon Mitchell, Inidicata UK’s group sales director.

“The result was a rapid fall in demand and prices as part of a major market correction. We expect a few more future adjustments as EVs establish themselves with consumers and dealers as they become an integral part of the used car mix,” he added.

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