Used market has major role in supporting new EV sales, says Cox
The UK should draw on the used car market to encourage EV adoption – potentially through government grants for buyers of used EVs.
The call comes from Cox Automotive, which says that without such support, total EV sales may never reach full potential.
New electric vehicle registrations have proved a ray of light during the pandemic – registrations of fully electric cars grew by 185.9% last year compared to a 29.4% fall in the overall new car market.
However, there are still barriers to take-up. A recent poll by Regit found that 92% of drivers are concerned that the country’s EV charging infrastructure is not up to today’s demand, and 69% are sceptical that it will be able to cope with extra demand by 2030.
But the used car market could help allay these fears and boost EV adoption throughout the UK, in particular as EV volumes and appetite increase as they become higher on the consumer choice list.
Cox data shows that as earlier EV models reach the used market, they are retaining high residual values, offering strong profit margins for dealers, and a more affordable, straightforward EV option for consumers.
It adds that with more knowledge about used EVs and greater access to stock, the used market could become the ‘proving ground’ that supports new EV sales.
Philip Nothard, Cox Automotive’s insight & strategy director, said: “Used EVs are becoming available to buyers otherwise turned off by the expensive new vehicle list prices, high monthly finance payments, and mixed messaging surrounding brand-new models.
“Some earlier EV models have been on the road for a decade, so these are increasingly reaching the used market and benefit both dealers and customers alike. They retain high residual values, offer strong profit margins for dealers, and offer a more affordable, straightforward EV option for consumers.”
And with Regit’s latest EV consumer survey showing motorists are divided when it comes to whether they support the 2030 ICE ban – 50.2% say they’re for the ban and 49.2% against – Nothard reiterated the role of the used market in making this happen.
He explained: “The UK needs to make its position on EV crystal clear for consumers and lean on the used market to help give motorists their first EV experiences, driving wider adoption across the country, which, in time, will undoubtedly be reflected in an improved position for new EV sales as the country continues to build its EV infrastructure. Perhaps a government grant for buyers of used EVs could positively impact EV adoption sooner and benefit the manufacturers of new ones.
“Wholesale buyers can help by specifically seeking out EV stock and ensuring a reliable supply to consumers, promoting continuous EV uptake as well as reaping rewards commercially.”