Used electric vehicle prices have plummeted over the last year, driven primarily by Tesla and its efforts to spur demand with better affordability.
According to automotive analytics platform iSeeCars.com, the average used EV price has now dropped a staggering 31.8%, or $14,418, since early 2023. At that time, inventory pressures created by the COVID-19 pandemic began to disappear, pushing dealers and manufacturers to lower MSRPs to maintain sales. However, that has only resulted in a modest 3.6% decline in the average preowned car price, underscoring the fact that EVs are facing unique challenges that are not present in other segments.
Last September saw the sharpest monthly decline in used EV prices, which dropped 39.1% from the year before to reach an average of $34,926. While the overall preowned market saw monthly fluctuations in year-over-year price declines ranging from 2.7% to 7.4%, the electrified segment has experienced declines of more than 30% for eight consecutive months.
Tesla has contributed more to this drop than any other brand. Used Teslas have lost 28.9% of their value over the last year, rapidly outpacing those from other automakers, including Alfa Romeo, which saw the second-greatest dip at 13.3%, and Maserati, whose prices dropped 9%. Some used EV models have actually seen marginal price increases since early 2023: preowned models from Porsche, GMC, and Chevrolet rose an average of $56, $70, and $140, respectively.
That said, some individual models became cheaper at a faster rate than others. For instance, the Chevrolet Bolt saw a 30.4% price decline, while the Tesla Model 3 lost 24.1%.
Speaking broadly, falling used EV prices can be attributed to over-ambitious production. Expecting demand to grow rapidly, automakers manufactured a surplus of battery-powered cars, only to find customers in shorter supply. But while most OEMs have sought to keep prices stable, allowing older models to retain their value, Tesla has taken an alternative approach, one that has had an impact on the entire market. “Elon Musk’s initial price reductions on new Teslas were already impacting EV values a year ago,” remarked Karl Brauer, executive analyst at iSeeCars.com. “But his repeated price cuts kept pushing used Tesla prices down, which spread to all electric vehicles, creating weakness across the used EV market.”
