6:57 am, May 9, 2023
While demand for new electric cars is falling, more and more consumers are searching for a used EV.
That’s one of the headlines in Auto Trader’s latest edition of its expansive Road to 2030 report.
The automotive marketplace has crunched data and insights from its platform to analyse what’s going on in the new and used electric car market so far in 2023.
It has been examining the current market dynamics between new and used electric cars, particularly around supply, demand and pricing.
Speaking to Car Dealer Live – in the video which you can watch at the top of this story – brand director Marc Palmer said: ‘Demand in the new electric vehicle market has been falling.
‘It’s been coming down since around September 2022 at the time of the mini Budget, increases in interest rates, inflation and electricity prices.
‘However, conversely, we’re seeing demand for used electric cars going up.’
Auto Trader’s latest findings concerning consumer demand for electric vehicles comes as the Society of Motor Manufacturers and Traders (SMMT) last week revised forecasts for total new EV sales in 2023.
SMMT chief Mike Hawes said economic concerns and anxieties around public charging points were casting a ‘cloud’ over new EV sales.
The organisation has slashed its full-year EV sales prediction by 0.7 per cent.
Meanwhile prices for used electric vehicles have been plummeting. Since October last year used EV prices have been in free fall with cars like the Tesla Model 3 losing more than £13k in seven months.
On average, used electric car prices are down 35 per cent, according to trade price experts Cap HPI.
Despite this, Auto Trader has seen a boom in consumers searching for used electric cars on its platform – partly, says Palmer, down to the fact there’s a lot more of them available to search for now.
Palmer said: ‘We’re seeing demand for used EVs to be up around 50 per cent year-on-year.
‘The [negative] headlines are very different from what we see in the data – demand is in rude health.
‘Supply is coming back a lot faster and that will continue to be the case for a number of years as the market stabilises and finds its level.’
The report drilled down further into the numbers and revealed in March alone demand levels increased by 23 per cent year-on-year.
Auto Trader’s report does accept that while there are more used electric cars arriving in the market, that supply is still ahead of demand and this is translating to EVs being the slowest fuel type to sell on dealer forecourts.
It took on average 45 days for a used electric car to sell in March – 18 days slower than used petrol cars and 20 days slower than used diesels.
This has led dealers to slash prices of used EVs.
A Tesla Model 3 Long Range, for example, was priced on average at £51,000 on Auto Trader in August 2022 – now prices have dropped by £11,000 or 21 per cent. Auto Trader looks at retail prices compared to those trade prices quotes by Cap HPI.
Palmer said: ‘Suddenly that aspirational Tesla has become more affordable with prices now closer to other brands and other cars on the market.
‘I wouldn’t say [Tesla’s new car price cuts] have completely changed the whole market, but it certainly had a ripple effect.’
Watch the full interview by clicking the video at the top of this story.
