Price gap between used electric and gas cars reaches lowest point ever at $900

The price gap between used electric and gas cars has reached its lowest ever point.

Plummeting prices led to a surge in used EV sales, which sounds good on the face of it.

But it raises a troubling question – are used EVs a bad investment due to depreciation?

Several experts have weighed in on the matter.

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The price gap between used electric and gas cars

Across the board, used electric cars are going for prices that beggar belief.

A brand-new Nissan Leaf would fetch around $35,000 when it was brand new back in 2017 – now second hand one can go for $6,500.

A second hand Hyundai Kona has fallen below $16,000, a significant drop from $43,000 back in 2021.

Even in the luxury market, there’s a noticeable difference – an Audi e-Tron GT would have cost around $124,000 three years ago, but a second-hand one goes for $52,000.

At first glance, this should be good news, right?

It incentivizes people to buy electric cars, and that seems to be what’s happening.

Research firm Cox Automotive reported a 59 percent surge in used EV sales year on year.

But it’s a double edged sword.

Will falling prices mean used EVs are a bad investment, and will owners lose out in the long run?

For Stephanie Valdez Streaty, the director of industry insights at Cox Automotive, the time to buy is now.

With the price gap between used electric and used gas cars at $900, it’s the lowest it’s ever been.

Savings made on not buying gas and lower maintenance costs will make up for the $900 additional pay-out.

The savings on EVs are plentiful, as this Tesla Model 3 owner found out after a year of ownership.

But will a discount be enough to convince people to give used EVs a chance?

John Helveston, an engineer and professor at George Washington University, isn’t so sure.

The battery depreciation issue

Until recently, batteries deteriorated at a faster rate, leading to some buyers remorse.

“If you bought a used Leaf even a few years ago, your experience was likely not great,” Helveston told Grist.

Whilst research has shown that EVs depreciate more quickly in the first two and three years, things tend to even out after that point.

After the third year, gas and electric cars lose their value at around the same rate.

Battery technology still remains hard to predict unfortunately – it’s hard to estimate how well a battery will perform five to 10 years down the line.

“There is this huge gap of information and because of that there’s a hesitance to buy it,” said Helveston.

Ultimately, car buyers will have to decide how they want to spend their money.

Investments always carry a degree of risk – and you have to decide whether you want to take that chance.

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