Values for three-year old used EVs fall by 43.8% in 18 months

The average three-year-old used electric car is now 43.8 percent cheaper than 18 months ago, new analysis suggests.

Indicata UK’s latest Market Watch report shows that used electric vehicles (EVs) experienced a 2% price fall in June, which has contributed further to achieving price parity between equivalent EVs and internal combustion engine (ICE) cars across many different sectors.

UK used prices fell by just 0.1% during June which, says Indicata, gives a clear sign of prices levelling off after falling by 16.5% since January 2023.

It also reports that demand continues to rise on the back of falling prices and is more in sync with supply.

Market days’ supply dropped to 50 days at the beginning of July, slightly behind hybrids at 47.5 days and diesel and petrol respectively at 45 and 41 days.

This means the UK had the lowest rate in Europe in June, due to a combination of stronger demand and dealers continuing to be cautious about stocking zero emission cars on their forecourts.

Market days’ supply is derived from dividing the currently available supply of inventory by the average daily retail sales rate over the past 45 days.

Manufacturer-backed tactical registrations also played a key role in the June market, says Indicata, with the sale of used cars under 12 months old up 15.9% month-on-month.

Many nearly new EVs are being fed into the market in this way as OEMs strive to achieve their 22% ZEV mandate 2024 target, it claims.

EV market share of used cars up to four years of age also continued to rise accounting for 9.3% in June, followed by diesel (10.8%) and hybrids (30.6%) while petrol remained the dominant fuel type with a 49.1% share.

Dean Merritt, Indicata UK’s head of sales, said: “Our latest used EV trends do not make enjoyable reading for leasing companies who have got used cars to sell at the end of customer contracts.

“Some are turning to secondary leasing for their younger lower mileage used EVs as a means of reducing the residual value pain, which also helps to reduce the chance of ex-fleet cars flooding the market.

“The good news is that consumer demand for used EVs continues to increase as prices get cheaper as they continue to find their feet in the used market. However, it remains a slower process than most would like,” he added.

Auto Trader also reported that pre-registering is on the rise as manufacturers seek to boost volumes of electric cars to reach their ZEV Mandate targets for 2024. 

“Whilst the market is growing, part of this is short cycle business and pre reg,” said Auto Trader UK director of automotive finance Rachael Jones on the Q2 broadcast of the Fleet News Market Insight with Auto Trader. 

She added: “There's been a 55% growth in vehicles listed on Auto Trader that are under one year old and under 100 miles on the clock, versus June last year. That's still a lot less pre reg than 2019 – it’s 44% back versus 2019 - but you can see that short cycle business is coming back.”