Used electric cars are now cheaper than their petrol equivalents, according to a breakthrough new report from market experts.
Average retail prices for EVs are 8.5 per cent cheaper than petrol at the three-year mark, rising to almost double that by year four, according to valuations specialists Cap Hpi.
It means buyers of used motors have more reason to go green than before, especially with running costs also being lower than those for an equivalent age model powered by an internal combustion engine.
The ground-breaking report comes as used EV sales rose by more than 50 per cent between April and June of this year compared to the same period in 2023.
Average retail prices of EVs are 8.5 per cent cheaper than petrol at the three-year mark, rising to almost double that by year four, new data from Cap Hpi shows
New EVs are, in general, significantly more expensive than new petrol or diesel cars – typically, motorists can expect a premium of between £5,000 and £10,000 to choose the battery-powered option.
But with EVs depreciating more rapidly, prices have fallen sharply over the past two years to the point where motorists can now snap up a second-hand electric car for a bargain cost.
Hpi data puts average retail prices of EVs at the three-year point around 8.5 per cent less expensive than petrol and diesel vehicles, rising to 14 per cent at four years.
And used EVs represent big savings over the price of new ones: on average, values of used EVs for cars at the same age and mileage point have halved in value since September 2022.
Putting a figure to those savings for models such as the Jaguar i-Pace, Mercedes EQC and Tesla Model X, this can equate to well over £20,000 less than in the summer of 2022.
A Porsche Taycan, can be double that at up to £40,000 less than it was two years ago.
Cars that were once out of reach and unattainable for many buyers can suddenly fall into their budget bracket.
Chris Plumb, EV specialist at Hpi, said: ‘The growing availability of second-hand electric models is driving demand as motorists want to reduce their environmental footprint and make significant motoring cost savings due to high diesel and petrol prices.’
The used EV market is experiencing a sales surge
Some 46,773 used all-electric vehicles found new homes in the second quarter of this year – a year-on-year increase of 52.6 per cent, latest figures published by the Society of Manufacturers and Motor Traders’ (SMMT) show.
EVs still only represent 2.4 per cent of the used car market, but this is the highest ever share, and up from 1.7 per cent on the same period last year.
Mike Hawes, SMMT chief executive, said it was ‘encouraging’ to see the market continue its recovery, adding that wider choice and affordability has been achieved thanks to a ‘rejuvenation’ in new car demand.
EV price parity achieved after three years – the popular moment to buy a used EV
When does an EV become better value for money than an equivalent petrol model? This is Money compare depreciation of like-for-like cars to discover when an electric vehicle will be kinder to your bank account. Take a look at our side by side comparisons here
Auto Trader insights put price parity between battery electric vehicles (BEVs) and petrol models at three years, even though brand-new EVs generally cost a third (33 per cent) more than an equivalent new combustion car, according to the used car marketplace’s data.
The platform has seen a sharp rise in demand for three-year-old EVs: June saw three-to-five-year-old electric cars sell a week faster than the rest of the market – 22 days compared to 29 days respectively.
Searches for EVs in this age bracket were up a whopping 175 per cent year-on-year in June, while searches for EVs of all ages were up 70 per cent overall.
This beats out searches for used ICE cars, with petrol searches falling 9 per cent and diesel 10.5 per cent.
Richard Walker, director of data and insights at Auto Trader, compared a Tesla Model 3 with a BMW 3 Series and Jaguar I-Pace (both petrol): In June, the average price of a three-year old Model 3 cost £22,400, while a 3 Series of the same age, was nearly £2,000 more expensive (£24,300).
‘A three-year old Jaguar I-Pace EV cost £23,400, while the petrol F-Pace was more than £10,000 more expensive (£33,500).’
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