As more and more people switch to electric vehicles, the used electric vehicle market is starting to see rapid growth.
Sale of used electric vehicles through licensed dealers up 32% in the first three months of the year, to nearly 43,000, according to data from industry analyst Cox Automotive. The average list price for a used EV was around $43,400, according to Cox, down 4% from prices at the start of 2022 and well below the average price of a new EV.
“Every new vehicle eventually becomes a used vehicle,” said Jonathan Smoke, chief economist at Cox Automotive, in a press release. “Our data sets show that used electric vehicle sales will increase rapidly from here, following a clear path set by new sales.”
The EV market in the US is growing rapidly, with Cox forecasting new sales to surpass 1 million cars for the first time in 2023. The uptrend is being fueled in part by efforts by the Biden administration, including tax credits for new and used EVs invested in the Anti-Inflation Law of 2022.
For used vehicles purchased in 2023, individuals may apply for a tax credit of up to $4,000 for qualifying plug-in electric or fuel cell electric vehicles. However, there are a handful of restrictions including that the car must be at least 2 years old and the credit can only be claimed once in a vehicle’s lifetime.
On Wednesday, the US Environmental Protection Agency is expected to propose rules aimed at “ensuring that by 2032, up to 67 percent of new passenger vehicles sold in the country will be all-electric cars.” That would be a massive jump from current EV sales, which Cox says are expected to reach nearly 7% of all new car sales in the first quarter of this year, a “record high.”