The used electric vehicle (EV) market in 2024 is seeing significant shifts, driven by falling prices and enhanced tax incentives, creating a favorable landscape for prospective buyers. Here are some key trends:
Pricing Trends
Used EV prices have dropped dramatically since 2021, near pre-pandemic levels. In 2023, prices fell by an average of 33.7%, far outpacing the 5.1% drop for traditional internal combustion engine (ICE) vehicles (Electrify News Site). This price drop is largely due to increased supply as more new EVs enter the market and automakers like Tesla adjust pricing to meet demand. Notably, Tesla models have experienced some of the steepest price declines. A used Tesla Model 3 can now be found for under $15,000, a far cry from its new price tag (Electrify News Site).
Aside from Teslas, other affordable models on the used market include the Nissan Leaf, Chevrolet Bolt, Kia Soul EV, and BMW i3, with many of these vehicles priced under $15,000 (Electrify News Site). The increased availability of long-range models has further enhanced the appeal of used EVs, offering more affordable options without sacrificing range.
Tax Incentives
The federal tax credit for used EVs is playing a pivotal role in stimulating demand. Under the Inflation Reduction Act (IRA), buyers of used EVs can qualify for a tax credit of up to $4,000, provided the vehicle is at least two years old, priced under $25,000, and purchased from a dealership (Investopedia) (Electrek). Starting in 2024, this credit can be applied directly at the point of sale, reducing the vehicle’s upfront cost rather than being claimed later on tax returns(Investopedia).
This change makes used EVs even more affordable. For example, a used Tesla Model 3 priced at $15,000 could cost as little as $11,000 after the tax credit (Electrify News Site).
The Buying Experience
While the lower prices and tax incentives are making used EVs more accessible, buyers should remain aware of certain considerations. Battery health is a key factor, as EV batteries typically degrade by about 2% per year (Electrify News Site). Additionally, the availability of home or public charging infrastructure should be assessed before purchasing, particularly for those who drive long distances or live in areas with limited charging options (Electrify News Site).
Overall, 2024 presents a unique opportunity for buyers looking to enter the EV market at a lower cost. With prices expected to remain attractive and tax incentives now available upfront, the used EV market is becoming an increasingly viable option for budget-conscious consumers.
If you have more questions about EVs, or the experience of owning an EV, feel free to ask us!