Tesla’s Price Cuts Spark Surge in Used Electric Vehicle Sales

The used EV market is finally starting to catch a bid, thanks to Tesla’s trendsetting in lowering prices during the last two years of major ongoing EV competition.

The change in the market has been evident at CarMax Inc.’s superstore in Fremont, California, according to a new Bloomberg report.

General manager Henry Melendez told Bloomberg about the results of the falling prices: “We’ve seen a really good amount of interest. They’ve always wanted to get into an electric vehicle, but it just wasn’t quite as affordable.”

Bloomberg writes that a growing trend across the U.S., including in Tesla’s hometown of Fremont, shows used EV sales jumping 70% in the year’s first half, according to Cox Automotive.

In June, iSeeCars.com reported that the average price of a used EV dropped below $30,000, making them cheaper than typical gas-powered cars.

The GM of Axis Motorcars in Jersey City, New Jersey told Bloomberg: “Tesla is driving the market by lowering the prices. Used EVs are sold more quickly than gas cars, almost in a week.”

Increased supply is boosting demand for used EVs, with inventory now four times higher than in 2021, according to Recurrent. And Edmunds notes that, overall, used EVs take longer to sell than gas-powered cars.

However, for models priced between $20,000 and $30,000, used EVs sell faster—within 30 to 36 days compared to 39 days for gas cars, the report says.

Government incentives are also helping. The Inflation Reduction Act offers $4,000 tax credits for used EVs costing $25,000 or less, making them more affordable. Jessica Caldwell from Edmunds adds that Tesla’s limited updates to its models, like the Model 3 and Model Y, make used versions appealing since they look similar to new ones.

Those incentives are, of course, up for discussion come November’s election.