Why are used electric car prices so low?

IMG_0828Three factors affect resale value on electric cars. First isthe federal tax credit and in some states a state tax credit and other incentives. Also electric car prices have fallen since introduction in 2011. And finally electric cars are improving functionally as new models are introduced.

The upside is for those who can’t afford a new car or don’t qualify for tax credits, used electric cars are very affordable. You can buy a low mileage used LEAF for less than $9,000.

If you calculate used electric car prices based on MSRP, depreciation may seem high. But you must remember most new car buyers and dealers leasing these cars got a the federal tax credit of $7,500 and sometimes addition state tax credits. California has had a $2,500 and Georgia a $5,000 incentive for example. While such incentives are in place, used car prices will be correspondingly depressed ed. Used car prices may increase as such incentives are discontinued.

In addition new electric car prices have dropped by $6,000 or more. This puts additional downward pressure on used car prices.

And finally there are functional improvements to range and charge time along with other features like more trunk space in the LEAF among many minor improvements like lighted charge port in the LEAF.

All the factors combine to make it more attractive to buy a new electric car compared to a used one priced at traditional depreciation rates. If you want to sell your used electric car you need to lower the price to account for the fact that newer models are cheaper than what you paid and have better function and more features.

On the other hand if you are buying there is good value in used electric car.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s