Used electric cars are now cheaper than their petrol equivalents, according to a groundbreaking new report from market experts.
According to valuation specialists Cap Hpi, the average sales price for electric cars at the time of purchase is 8.5 percent lower than for petrol cars. In the fourth year, that is almost double.
This means that used motorcycle buyers have more reason to choose environmentally friendly than before, especially as the running costs are also lower than those of a similarly aged model with an internal combustion engine.
The groundbreaking report comes after used electric car sales rose by more than 50 percent between April and June this year compared to the same period in 2023.
The average sales price of electric cars is 8.5 percent cheaper than that of petrol cars after three years. In the fourth year, it is almost double, according to new data from Cap Hpi.
New electric cars are generally significantly more expensive than new petrol or diesel cars. Typically, motorists can expect to pay between £5,000 and £10,000 extra if they opt for the battery-powered option.
But with electric cars depreciating at an accelerating rate, prices have fallen significantly over the past two years, meaning motorists can now buy a second-hand electric car for a bargain.
HPI data shows that the average sales price of electric cars is around 8.5 percent lower than petrol and diesel cars at the three-year point, and by 14 percent after four years.
In addition, second-hand electric cars are a lot cheaper than new cars: on average, the value of second-hand electric cars of the same age and with the same mileage has halved since September 2022.
If we express these savings in figures for models such as the Jaguar i-Pace, Mercedes EQC and Tesla Model X, this could equate to over £20,000 less than in summer 2022.
A Porsche Taycan can cost twice as much and be up to £40,000 cheaper than it was two years ago.
Cars that were previously out of reach for many buyers may suddenly fall within their budget.
Chris Plumb, EV specialist at Hpi, said: ‘The increasing availability of pre-owned electric models is driving demand as motorists look to reduce their carbon footprint and make significant savings on their motoring costs due to high diesel and petrol prices.’
The used electric vehicle market is experiencing a sales spike
In the second quarter of this year, 46,773 used fully electric vehicles found a new home, up 52.6 percent on a year earlier, according to the latest figures from the Society of Manufacturers and Motor Traders (SMMT).
Electric cars still represent only 2.4 percent of the used car market, but this is the highest share ever and up from 1.7 percent in the same period last year.
Mike Hawes, CEO of SMMT, said it was “encouraging” to see the market continue to recover, adding that greater choice and affordability had been achieved thanks to a “revival” in demand for new cars.
EV price parity reached after three years – the popular time to buy a used EV
When is an EV better value for money than an equivalent petrol model? Here’s Money comparing the depreciation of similar cars to find out when an electric vehicle is kinder to your bank account. See our side-by-side comparisons here
According to used car market data, price parity between battery electric vehicles (BEVs) and petrol models stands at three years, even though brand new electric vehicles typically cost a third (33 percent) more than a comparable new combustion engine car.
The platform has seen a sharp increase in demand for three-year-old electric cars: in June, three to five-year-old electric cars sold a week faster than the rest of the market – 22 days compared to 29 days, respectively.
Searches for electric cars in this age group increased by a whopping 175 percent in June compared to a year earlier. Searches for electric cars of all ages increased by 70 percent overall.
This is better than searches for used ICE cars, where searches for petrol fell by 9 percent and searches for diesel fell by 10.5 percent.
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, a three-year-old Model 3 cost an average of £22,400, while a 3 Series of the same age was almost £2,000 more expensive (£24,300).
‘A three-year-old Jaguar I-Pace EV cost £23,400, while the petrol F-Pace was over £10,000 more expensive (£33,500).’
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