Used vehicle prices are thankfully beginning to stabilize after a few years of turmoil. At the same time, used EV prices are taking a tumble, led by Tesla’s new car pricing changes and an increase in supply.
iSeeCars’ latest study found that while overall prices slid just 3.6 percent, EV prices dropped 29.5 percent, accelerating the already-significant drops of 28.9 percent in May and 24 percent in April. Those changes follow months of price increases, during which time EV pricing growth far outpaced increases in the overall used car market. Though used pricing appears to be leveling off, iSeeCars expects the market to remain elevated from pre-pandemic levels through the rest of 2023.
Tesla’s new car pricing changes have been a significant driver of the price changes. Earlier this year, the automaker began aggressively cutting prices on all models after years of progressive price increases. That put pressure on used Tesla values, which had ballooned alongside the new models’ price tags. Since Tesla vehicles comprise such a large portion of the EVs in this country, changes in its fortunes have an outsized impact on the market.
The other major contributing factor is consumer demand. People have surprisingly short memories, as they tend to look for fuel-efficient vehicles when gas prices are high and buy the largest truck or SUV they can afford most other times.
When Russia invaded Ukraine in 2022, the war drove the price of oil way up, which took gas prices north as a result. That shift pushed many buyers toward EVs and other electrified cars, and the jump in demand caused elevated prices. Gas prices have stabilized now, so buyers are naturally back on the SUV train, and the drop in demand means a decrease in prices.
Most of the individual models with the biggest price drops were electrified, but a couple of luxury SUVs made the list:
- Tesla Model 3: -30.5%
- Tesla Model X: -21.3%
- Nissan Leaf: -19.2%
- Tesla Model S: -19%
- Land Rover Range Rover: -18.5%
- Land Rover Range Rover Velar: -17.5%
- Land Rover Discovery: -16.8%
- Hyundai Ioniq Hybrid: -16.2%
- Jaguar E-Pace: -16.2%
- BMW 5 Series: -15.5%
Interestingly, some models bucked the trend and saw prices increase. The Porsche 718 Cayman, 911 Convertible, Chevy Suburban, Fiat 500X, and Mercedes-Benz SL-Class all increased in price between June 2022 and 2023, with the SL climbing more than 14 percent since last year. That said, there are deals to be found, especially on used Teslas, and iSeeCars expects prices to remain relatively flat for the next year.
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