Experts have given a stark warning to owners of electric vehicles in the UK. Electric cars have grown in popularity in the UK over the last few years, with many people preferring what they see as the more sustainable option. Drivers have also taken advantage of various discounts available to them when purchasing electric cars. However, not everyone is impressed with their EV experiences, and many drivers still opt for petrol and diesel cars.
New market data offers some concerning insights for EV drivers in the UK. The car experts at Show Plates World have analysed the figures from Auto Trader’s latest Retail Price Index. It shows the value of electric cars has dramatically decreased over the past year. Compared to this time 12 months ago, the average used EV is now worth 7.4% less. Additionally, some three-to-five-year-old models fell by a staggering 11.6% year-on-year. Experts have called it the steepest depreciation in the UK car market, with no signs of slowing down.
Slow Plates World says this is the result of a perfect storm of factors. Firstly, there has been a soaring supply of second-hand EVs as the first big wave of fleet and lease cars enters the used market. Plus, there have been “aggressive” price cuts on new EVs from major manufacturers, including Tesla, which are instantly dragging down the value of nearly new models.
There is also growing competition from cheaper imports, namely from China, with brands targeting the UK market at “cut-throat prices”. Additionally, there are lingering concerns over battery degradation and charging infrastructure among second-hand buyers.
“Many models have already fallen 20-30% from their peak, but some still have a way to go,” said Derren Martin, head of valuations at CAP HPI. He pointed out the inflated prices seen during the pandemic-era shortage, now resulting in a “realignment” of prices.
Data from Auto Trader shows the top 10 biggest year-on-year price drops are all electric cars. Experts have warned that households could lose thousands within months.
For example, a typical three-year-old electric family car worth £25,000 today could lose £2,500–£3,500 in the next six months alone. The BMW i5 has fallen 21.7%, the Nissan Ariya is down 19%, and Tesla’s Model Y has plunged 16.2% in value in just 12 months, data shows.
This is compared to some petrol and diesel cars, most of which remained at the same value or even gained value.
Andy Shields of data firm Indicata has warned of a slew of Chinese imports, revealing that it could lead to ” pressure on used vehicles because of lowering new car list prices and excessive supply”.