Is our honeymoon with the electric vehicle finally over? A study found that one in five early adopters of EV cars and trucks are returning to gas-powered vehicles. As a result, used EV prices are freefalling.
Why are early EV adopters returning to ICEs?
The Journal Nature published a study revealing that of the folks who were early adopters of EVs in California (between 2012 and 2018), 20% of PHEV drivers have returned to fully gas-powered vehicles and 18% of full EV drivers returned to gas-powered–with their subsequent vehicle purchase.
You read that right: one in five people who tried to make EV life work are now returning to traditional, internal-combustion-powered vehicles.
One big demographic “defecting” back to internal combustion was renting their home, then moved to a new place with no Level 2 charger. This may or may not be related to the massive migration away from urban areas during the COVID-19 pandemic. A farm upstate seems idyllic, until you find there’s no place nearby to charge your Tesla.
While the average used vehicle’s value fell 3.6% during June 2023, the price of the average used EV plummeted 29.5%. In May, the same number dropped 28.9%. And in April, it fell 24%. It is safe to say that used EV prices are in freefall.
Which electric vehicle prices are falling the quickest? Teslas, followed by the Nissan LEAF. The price of a one-to-five-year-old Tesla Model 3 is 30.5% lower than it was this time last year. The Tesla Model X is down 21.3%. Tesla Model S values have dropped 19%. The Nissan LEAF’s average value has fallen 19.2% since last year.
These aren’t the only used electric vehicles with falling prices. The Hyundai Ioniq’s value is down 16.2% in the past year. The Jaguar E-PACE is also down 16.2%. Finally, BMW’s PHEV 5 Series’ values fell 15.5%.