I've been watching and reading a few articles about how the price of EV's have plummeted. Which get's me a little annoyed for three reasons:
1: These articles and videos are mostly by armchair expert speculators with no practical experience themselves, and
2. Why do people always use extremes as the norm ?
3. The forecourt prices certainly haven't reflected these recent drops.
For all sorts of reasons, used car prices have been all over the place since Covid struck. One commentator blamed this, that and t'other for the price of EV's plummeting but really? Are the prices of used ICE and hybrids not plummeting too? Let's find out.
So rather than listen to these armchair experts speculate and look at their CAP value books which themselves are just guides, why not use a real world example to see how the market has chaged. I sold our Karoq in the summer, so lets use that.
1. I bought the car Nov 2019 for a fraction under £25k after discount ( the list back then was a few quid under £30k.)
2. I sold the car to a large online retailer back in late summer 2023 for £22500. That meant the car depreciated £2500 in 3.5yrs. I of course was very happy,but new that wasn't normal, it was an insane price. The retailer put the car up for sale at £24k. That was 5 months ago, almost to the day.
3. I've just obtained another quote to sell that car - I added 2000 miles to the mileage as that's all it'd have done in that time. How much do you reckon the same dealer has quoted me online? £13825 😲 So in the past 5 months, our old Karoq has dropped £8675 in value. Ouch ! These large price drops definitely don't just apply to EVs.
4. But it's not a horrendous drop, rather it's just the market returning to normal. The car originally listed at £30k four years ago, and it's now worth say £14k which represents depreciation of around 45-49% - perfectly normal ( maybe a little better than normal considering it's a Skoda ). So what's all the fuss about used prices 'nose-diving' ?
Imagine having budgeted for a new car - you placed your order say 6mths ago, you're about to take delivery, and you find your current car is now worth around £8000 less than you thought it would be. Ouch !!!
What about dealers - do we have sympathy for them, after all they may have stock they bought at a high price and haven't been able to shift. Err, not from me. I've just looked on Autotrader for cars similar to the car I sold and which I would have been offered £13825 if I were to sell it today. The dealers are asking from £20k for it. ( some asking much higher )
So one tip for anyone looking to buy a car right now, especially a used car, is know exactly how much it's actually worth. Yes the dealer may have bought it when the prices were high, then again, they may have bought it recently hence there's a potential huge profit margin you can negotiate with. Some of the prices still being asked are eyewateringly expensive.