The AA’s September Recharge Report has highlighted the need to boost the used EV market to help the government reach its net zero targets.
Recent research in the UK’s first EV Readiness Index revealed that 90% of private sales in 2024 were used cars, which cannot benefit from the official EV Grant scheme.
Consumers who exclusively buy used cars have called for incentives to help them participate in the move to electric vehicles with either a similar grant, an interest free loan, or removing VAT from the purchase price.
When comparing the upfront costs of buying a new or used EV, there is a significant advantage of purchasing a used EV, with prices much closer in parity when set against their petrol models.
Currently, a new electric car is 27% more expensive than it’s combustion version, while a used electric car is 3% more expensive compared to used petrol model.
While this may be appealing to private buyers, fleet and leasing companies that are outstripping private new EV sales are taking significant risks with the levels of depreciation on each purchase.
If there continues to be no intervention in the used market, The AA said it “worries about the long-term health of the used car supply chain”.
In the upcoming Budget on 27 November, The AA is calling on the Chancellor to introduce some form of used EV incentive to maintain the supply change and invigorate the market.
Should appropriate measures for the used EV market be unveiled in the upcoming Budget, electric car drivers can benefit from static pricing when charging on the public network.
While pump prices increased slightly compared to August, the cost to charge remained the same with some significant savings to be made if drivers are willing to recharge during unsocial hours.
With ultra-rapid off-peak hours offering prices as low as 50p/kWh, drivers can add 80% charge for £20, half the price in comparison to filling up a tank for fuel.
Jack Cousens, head of roads policy for The AA, said:
“In order to maintain longevity of the electric transition, more needs to be done to bolster the used EV market.
“Fleet and leasing companies are currently propping up the sector with a solid turnover of cars, but this can’t continue much longer. The depreciation levels on used EVs is reaching a tipping point where some form of used electric car incentive is needed to help shoulder some of the burden.
“While the grant on new EV’s is welcome, the majority of private car sales takes place in the used market. Those looking to buy are wowed by the technology EVs offer and, with the right incentive, could make drivers think twice before choosing their new wheels. Using the Budget to announce a used car grant, or discounting VAT on used sales, would help invigorate used EV sales.
“If the right interventions can be made soon, more drivers will be able to benefit cheaper and stable charging costs compared to pump prices. The retention of charging costs from the summer means EV drivers know the price they pay at the charger is the same across the country – giving them better peace of mind.”
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