The UK car market has two significant waves across any year: The new registrations that happen in March and April and then again in September October – as the number plates change. The data science team at Auto Trader monitor close to 800,000 cars every day, checking for patterns in the underlying numbers. The latest data shows that demand for used electric vehicles is increasing and that second hand EV prices are becoming much more competitive.
Electric care are still a relatively new product to buy second hand. While it has been possible to buy EVs like the Nissan Leaf since 2011, the product available to drivers now is vastly different. The price, specification and (most importantly) range of modern EVs started to take shape around 2020. In the three years since, the number of brands/models in the market has exploded – and pricing has become much more competitive – especially with countries like China joining in the chase for consumer cash.
While Tesla has been the firm market leader until recently, with typical pricing in the £40-100,000 range, global number one BYD has launched the ATTO 3 less than £40,000 and has plans on the horizon to attack the £10,000 price point. Tesla has reacted to increasing competitive pressure with a series of package optimisations and price cuts. Other brands, unable to compete with Tesla’s reputation for performance/range, have had to follow suit – and a number of major European brands have been offering purchasing incentives worth up to £10,000 recently. As we reported recently, Tesla, SAIC and BYD continue to lead.
Year on year, the advertised price of a second hand EV has dropped by almost 19% – as availability has doubled (year on year) from May 2022 to May 2023.
Looking at the number of searches being carried out on second hand electric vehicles, the number of drivers who are looking to switch away from petrol/diesel is increasing by around 44% year on year.
The drop in average EV prices has significantly closed the upfront price gap between many electric models and their ICE counterparts, and in some cases, made them cheaper. For example, a three-year-old electric Jaguar I-PACE is now £600 cheaper than a traditionally fuelled F-PACE. And with retailers slashing the prices of used Teslas more than any other brand in response to new car price reductions, the average price of a used 3-year-old Model 3 (£30,700) is now just £3,600 more expensive than a BMW 3 Series of the same age – in August the price gap was a whopping £22,000. As a result, the Model 3’s market share of electric enquiries through Auto Trader has shot up from 8% to nearly one in five (18%) over the same period.
There are now around 15,000 second hand EVs for sale on Auto Trader and 29% of those are now under £20,000 – and searches for EVs has shot up from 4% to just under 8% in one year. You can find earlier model EVs, like the Citroen C-Zero, for less than £3,500 from time to time.
Auto Trader’s Director of Data and Insight, Richard Walker, said “The health of the used car market remains extremely buoyant, as despite growing pressures on household finances, we continue to see car buying demand on our marketplace well ahead of last year’s levels. With no imminent change to the current market dynamics, we can expect used car prices to stay strong for the foreseeable future, which should help retailers maintain robust margins”.
Walker predicts that there will be close to 1 million EVs on the UK’s roads by the end of the year.
So how long is it taking for EV buyers to make their selection and part with their money?
Well that is very brand dependent, according to Walker. He says that as supply and demand dynamics improve, used electric cars are starting to sell faster, with the average EV taking 42 days to sell in May, which is down from a peak of 47 days in January. However, the speed of sale lags far behind petrol and diesel cars, which both took an average of just 27 days to leave forecourts last month. The Tesla dynamics impacting price are also seeing used Teslas fly off the forecourt with an average of 22 days to sell, almost half of the overall used EV average.
Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), says “It’s positive to see used EV retail prices begin to stabilise. NFDA’s Electric Vehicle Approved (EVA) scheme positions dealers at the forefront of EV retail and are critical information hubs for consumers seeking to make their transition to electric and debunking any misconceptions relating to used EVs”.
As more EVs are launched into the market, with lower prices, increased ranges and very simple servicing schedules – so the draw toward cleaner motoring will increase. Now we need a sensible increase in the number of public charge points and a corresponding decrease in the price per kWh for electrical power.
To see the very best EVs available in 2023, check this link.