Why It’s a Good Time to Buy a Used EV

By: Keith Wagstaff · May 01, 2024 · Reading Time: 3 minutes

New Life For Old Cars

If you’ve been toying with the idea to go electric for your car, this may be the time to do it. As leases expire and rental fleets are culled, lower prices could tempt U.S. consumers to finally embrace used electric vehicles.

Sales of new EVs slowed this year. Potential buyers have cited high prices as a major barrier to EV adoption, with only four models costing $40,000 or less in the United States.

But as demand for new EVs falters, used ones are becoming more attractive than ever.

Explaining the Price Drop

As of February, used EV prices dropped 13% over the last year, according to battery research firm Recurrent .

A series of Tesla (TSLA) price cuts have pushed other automakers to keep pace, putting downward pressure on prices for used EVs. At the same time, as the EV market has grown and matured, the supply of used electric vehicles has increased.

Plus, a flood of used EVs from car rental company Hertz (HTZ) could make electric vehicles even more affordable.

The Great Hertz Sell-Off

Last week during an earnings call, Hertz said it would sell an additional 10,000 vehicles from its EV fleet this year.

The announcement came several months after the company said it would sell 20,000 of its EVs, including Teslas, partly due to higher expenses related to collisions. For those who haven’t driven an EV before, the instant and intense acceleration can be quite a surprise.

Currently, on its website, Hertz is selling used Tesla vehicles for less than $30,000 and used Chevy Bolts for under $20,000.

Why EV Prices Could Drop Even More

Leases for electric vehicles skyrocketed in 2023, Jimmy Douglas, founder of EV marketplace Plug, told Fast Company . Those 36-month leases will end in 2026, and result in a glut of used EVs.

Meanwhile, electric automakers are expected to keep releasing lower-cost models. Bloomberg reported in March that Ford (F) is looking to sell a $25,000 electric crossover by 2026, while Tesla CEO Elon Musk said last week the company could release its most affordable model ever by 2025.

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