A study finds that electric vehicles lose value more quickly than gasoline-powered cars
Recent studies indicate that electric vehicles depreciate more rapidly than gas cars, but there’s a shifting trend underway.
A study finds that electric vehicles lose value more quickly than gasoline-powered cars suggest that while older electric vehicle (EV) models experience quicker depreciation compared to traditional gasoline cars, newer EV models boasting extended driving ranges demonstrate improved resale value, nearing the retention rates commonly seen in gasoline vehicles.
A comprehensive analysis of over nine million car listings across more than 60,000 dealerships between 2016 and 2022 revealed that older battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) with limited driving ranges experienced accelerated depreciation compared to traditional and hybrid cars, with Tesla being a notable exception as its older BEV models retained value better.
However, the study highlighted a shifting trend: newer EV models boasting longer driving ranges exhibit improved resale value compared to their predecessors with shorter ranges. Additionally, the research highlighted the significant impact of the COVID-19 pandemic on vehicle affordability, showing a 37% increase in mean listing prices for gasoline cars and a 39% rise for BEVs, when adjusted for inflation to 2019 dollars, from January 2020 to March 2022.
A study finds that electric vehicles lose value more quickly than gasoline-powered cars: According to John Paul Helveston, Assistant Professor of Engineering Management and Systems Engineering at George Washington University and the study’s lead author, the situation presents a dual challenge. While the improved resale value benefits new car buyers, it also signifies the decline of lower-priced used electric vehicles, which previously served as an accessible option for many. Helveston highlights that the recently introduced $4,000 subsidy for used electric vehicles under the Inflation Reduction Act (IRA) could alleviate some of the pressure on the used market.
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