Why Used EV Prices Are Falling

complete this year, which is an interesting kind of knock-on effect on the

used

market, meaning that within three years, a ton of them will start showing up on the

used

market. Skeptics like Karl Brauer think that more changes will really need to be made before the used car market becomes more like its internal combustion counterpart. Therefore, they have to cost as much as combustion engines. They need to travel as far as combustion engines and they need to refuel as quickly as combustion engines. If electric vehicles can do those three things, why wouldn't you buy an electric vehicle?

In addition, more important economic factors, such as high interest rates, would need to change. The factors that exist, which are an incipient oversupply of new electric vehicles, which makes them less valuable and drives down their

prices

, and economic concerns and high interest rates. I don't see any of that changing in the coming months, so there's no reason to believe, at least in the short term, that we would suddenly see a setback in used EV

prices

. An increase in gas prices could also stimulate demand, but under certain conditions, interest in hybrids and electric vehicles tends to increase when gas prices rise, but stabilizes when prices stabilize, even if the price is high.

Understanding the used EV market and its depreciation presents serious challenges. First, the data set is small. As mentioned, only a small proportion of all used cars are electric vehicles. Second, as the market is still new and technology changes rapidly, there are still unknowns. Battery technology is one of those areas. It's something that worries people because they say, you know, my iPhone is down to 80% after two years, what's going to happen to my car? So it's one of these things that may be more of a consumer perception issue in real life. I mean, what we're seeing with Teslas is that the batteries tend to last 7 or 8 years and are still pretty good at the end.

The short story on battery longevity is that EV batteries hold up better than people's expectations. It is not true that an electric vehicle is an iPhone on wheels. It doesn't work the same way, but there is variability between different cars of the same make, model and year. And that's especially true as vehicles age. So if you start with a car that has a range of 250 miles, after five years it could have a range of 200 or 220, depending on how it's used, how it's charged, and what weather conditions it's exposed to. A simple change in federal tax credit rules can cause a flood of used vehicles within three years and a single manufacturer, Tesla, can move the entire market simply by changing prices on its website.

This is still a new market. We're still figuring out how electric vehicles work at scale. We're still figuring out how charging works at scale. It's all these little things. People are doing these things for the first time, used non-Tesla electric vehicles are a new thing to some extent. Wear. Teslas are still a new thing and we are all still learning how it will work. Everything is still emerging.