The used electric vehicle market is experiencing a significant shift, mirroring changes observed in the new car market over the past couple of years. Until 2021, used electric vehicles constituted a small fraction of the used car marketplace. However, due to an influx of EVs into the market and a scarcity of other vehicles, an increasing number of used car buyers are now considering electric options.
Financial Considerations and Incentives
When pondering the purchase of a used electric vehicle, one must assess the financial advantages. While there isn’t a federal tax credit of $7,500 available for used EVs, some states offer state income tax credits, substantially reducing the overall cost. Additionally, the absence of the tax credit on used EVs might mean they’re already discounted by the value of that credit, making them substantially cheaper compared to new models.
Potential Savings and Utility Rebates
Apart from tax incentives, there are potential long-term savings with an electric vehicle. Consider the reduced fuel costs over the lifespan of the vehicle. Furthermore, some electric utility companies provide rebates for individuals owning a used electric vehicle, aiding in electricity cost savings. For example, California Edison offers such rebates, and similar incentives may exist with local electric companies.
Addressing battery concerns
Battery lifespan and replacement concerns often deter buyers from investing in used electric vehicles. While batteries will eventually need replacement, it’s usually after several years of use. However, specific conditions or extreme weather might cause premature battery failure. Thus, ensuring the vehicle’s battery health is crucial before purchasing.
Evolving Resale Value
Currently, the resale value of EVs is generally below average. However, as the demand for combustion vehicles diminishes, used electric vehicles may see an increase in resale value in the coming years. A well-maintained modern electric car might become a budget-friendly option compared to traditional internal combustion engine cars.
Future Shifts in the Market
The trajectory of the automotive market is evolving rapidly. As seen with Hyundai’s decision to move away from gas vehicles entirely and focus on all-electric models, the landscape of used electric vehicles is poised for substantial transformations. This shift could potentially redefine the value and desirability of used EVs in the near future.