New and Used EV Prices Have Decreased, but Don't Hurry to Purchase: Expert Warns of an Unfriendly Market

Electric Vehicle Prices Drop, But Costs Still High

Prices for Used and New EVs Decrease

Prices for both used and new electric vehicles have dropped substantially from a year ago. According to a recent study by iSeeCars, prices for used EVs fell by almost 30% in June. Similarly, new EV prices fell nearly 20% from their peak in June of last year. These price decreases can be attributed to increased inventory and competition in the market.

Reasons for Caution

While the drop in prices is significant, experts still advise caution when considering purchasing an electric vehicle. The cost of new EVs is still high compared to traditional gasoline cars. Additionally, there are risks associated with buying a used EV. It is important for potential buyers to weigh the benefits and drawbacks before making a decision.

Record Sales and Manufacturer Incentives

Despite the high costs, electric vehicle sales reached a record high in the second quarter of this year. Tesla, in particular, has been cutting its prices to stay competitive in the market. Other manufacturers, such as GM Motors, Ford, Hyundai, and Kia, have also lowered prices and offered incentives to attract buyers. This has contributed to the decrease in average EV prices.

Considerations When Buying Used EVs

As the market for used EVs begins to develop, buyers should exercise caution. Battery life and utility can be a concern when purchasing a used EV, as older models may have shorter driving ranges. It is important to take a test drive and get a professional inspection before making a purchase. Additionally, the long-term running costs and value of a used EV battery are still uncertain.

Alternatives to High Priced EVs

If the high prices of new and used EVs are a deterrent, there are alternatives to consider. One option is to look into plug-in hybrid vehicles, which offer many of the benefits of an EV without the high cost. Another option is to lease an EV, which allows buyers to bypass certain requirements to qualify for tax incentives. However, it is important to ensure that the dealer will provide the necessary incentives or look for dealers advertising the offer.

Conclusion: Electric Vehicle Price Drops Create Opportunities and Challenges for New Businesses

The significant drop in electric vehicle (EV) prices presents both opportunities and challenges for new businesses looking to enter the market. While the decrease in prices for both used and new EVs is a positive development for potential buyers, the high costs compared to traditional gasoline cars still require cautious consideration. The record sales and manufacturer incentives for EVs indicate a growing demand and market saturation, which can be advantageous for new businesses entering the EV industry. With increased competition, there is potential for innovative startups to offer unique solutions, technologies, and services to differentiate themselves in the market. However, new businesses must also be aware of the considerations when dealing with used EVs. Battery life and utility can pose challenges, and ensuring the reliability and longevity of used EVs is crucial. By providing trustworthy inspections, warranties, or even refurbishing services, new businesses can capitalize on the growing used EV market and address consumer concerns. Furthermore, offering alternatives to high-priced EVs, such as plug-in hybrid vehicles or leasing options, can cater to a broader customer base. This opens doors for new businesses to introduce innovative financing models, subscription services, or rental programs focused on EVs. In conclusion, while the drop in EV prices presents potential opportunities for new businesses, it is essential to address the challenges associated with purchasing and selling used EVs. By understanding consumer needs, offering value-added services, and exploring creative financing options, new businesses can position themselves for success in the evolving electric vehicle market. Article First Published at: https://www.cnbc.com/2023/07/26/new-and-used-ev-prices-have-dropped-but-dont-rush-to-buy.html