London, Europe Brief News – In February David Cottrell purchased a Tesla for $39,999. He loved the small electric hatchback. He afterwards decided to enter the make and model into an online used automobile retailer’s website. Surprise! The Tesla was already worth $10,000 more than they paid for it. They were considering purchasing a property in Seattle, so the additional income seemed like a no-brainer. It was a nice $51,000 profit by June. So, the business for used electric cars is booming.
Cottrell now regrets the deal. He likes his new home and is looking forward to receiving his larger Rivian electric vehicle this summer. The automobile was worth roughly $2,000 less than he sold it for, even after accounting in the 20,000 miles he’s traveled since then.
The Rising Demand of Used Electric Vehicles has Spiked Prices
According to the US Bureau of Labor Statistics, used ELECTRIC CARS, automobile and truck prices rose 35% in March compared to the same month last year due to a toxic combination of supply constraints and inflation. Used premium automobiles like Porsches and Corvettes sometimes sell for more than their original sticker costs, says the owner of Green Eyed Motors. Now it’s “in the commoner’s automobile,” he adds.
Stranger even, secondhand automobiles appear to be growing newer in the age of electric vehicles. The bulk of secondhand electric vehicles for sale were four or five years old in 2017, according to statistics from Recurrent and Marketcheck. Almost a third of used EVs are already three years old. In 2020 and 2021, 17.5% of inventory is EVs.
Reasons Behind rise in Used Electric Vehicles
It’s also a bummer for anyone wishing to switch electrics right now. Despite high pricing, Walch claims EVs and hybrids are flying off lots. On-line auto dealer Carvana claims 90% of its electric vehicles are now being bought, up from 45% a month ago.
The emergence of the new used automobile began with the microprocessor shortage in 2021. Modern cars utilize at least 100 chips to manage their sophisticated electronic systems, while electric cars use up to 1,000. When the Covid-19 epidemic erupted in 2020, automakers lowered sales predictions and chip purchases. Chipmakers went elsewhere. That was followed by thousands of dollars in US bank accounts.
The Russian invasion of Ukraine triggered additional supply chain constraints. Last month, the price of nickel, an ingredient in certain EV batteries, jumped significantly. In the US, skyrocketing petrol costs prompted electric vehicle purchases.
Conclusion
In the short term, the new and used EV crunch—and the temptation for owners to sell their new Teslas, Ford Mustang Mach-Es, and even cheaper Nissan Leafs—may persist. According to research, the new vehicle transaction prices fell 0.3% between February and March.
This is because some new model automobiles were never produced. That means fewer used automobiles this year, next year, and the year after. It will take a long time for new vehicle pricing to recover, says Scott Case, co-founder and CEO of Recurrent, a battery health firm. We’ll need time to work through this system and find a new normal.
