The average three-year-old used car now costs $32,635, a staggering $9,476 increase since 2019, according to a new study from iSeeCars.com. Karl Brauer, executive analyst for the platform, joins today’s episode of CBT Now to unpack how affordability has sharply declined for used vehicle shoppers, what this means for EVs, and why Tesla’s future may hinge on the success of its autonomous robotaxi program.
Affordability has shrunk dramatically in just a few years. In 2019, roughly 50% of three-year-old used vehicles were available for $20,000 or less. Today, only 11.5% of them fall within that same price range. As incomes fail to keep pace with vehicle prices, many consumers are opting for older models, even cars with over 100,000 miles, due to their better durability and longer vehicle lifespans.
"Unfortunately for used cars, $30,000 is the new $20,000."
Several factors have contributed to this price shift, including general inflation, production slowdowns during the pandemic, and increased demand resulting from suburban migration during the COVID-19 pandemic. The result: a limited supply of desirable late-model used cars at the exact moment demand has surged.
Despite overall pricing increases, used EV prices have dropped and now average around $31,000, slightly below the average for all used cars. Further, Brauer notes that this narrowing price gap reflects the value-driven nature of used car buyers, who won’t pay a premium for EVs unless the value is clear. With EV incentives set to expire and infrastructure concerns lingering, Brauer believes EV market share could fall from its current 7–8% to closer to 5%, stabilizing among a smaller group of core buyers.
Looking ahead, Tesla’s future could be tied to the success of its long-promised RoboTaxi service. As EV competition heightens, especially from China, and EV growth plateaus, Brauer sees Tesla’s pivot to autonomous ride-hailing as critical. However, competition is fierce, with rivals such as Waymo, Zoox, and Baidu vying for the same goal. Unlike Amazon and Google, Tesla lacks a diversified business to fall back on if its autonomous efforts fall short.
Although autonomous vehicle testing is expanding in places like Peachtree Corners, Georgia, Brauer says full-scale deployment is likely 15 years away. Today’s systems still struggle with variable weather and unpredictable driving environments. Until then, he says, self-driving technology will remain limited to controlled, geofenced areas.
In the meantime, the industry continues to grapple with rising costs, softening EV demand, and long-term bets on autonomous solutions that remain years from widespread adoption.
