EV affordability and used market key to unlock plug-in sales success

Effectively addressing affordability for new and used electric vehicles (EV) can spur on plug-in vehicle demand, according to Auto Trader.

The online marketplace has put together its latest Road to 2035 report, which shows that new EV discounting and used EVs can attract customers, in what has been a challenging retail market for zero emission vehicles.

Auto Trader said price parity can be achieved on most two year old EV models, with nine out of 10 in-market buyers that viewed a new EV also looking at a used EV as an option too.

While this is positive for used EV sales at retailers, this also poses a potential risk to new EV sales if prices don't reach parity.

Original equipment manufacturers (OEMs) have been bringing down new EV prices, with Auto Trader tracking that discounts on new EVs have increased by 5.5 percentage points year-on-year to 10.6% and seven in 10 models saw lower average prices in order to try and stimulate retail demand.

Auto Trader expects other OEMs to adopt a push strategy on EVs to reach ZEV targets and take market share, while others will seek to protect margins.

Ian Plummer, Auto Trader commercial director, said: “The regulatory pressure is really amping up now as we’re almost halfway through the first year of the Zero Emission Vehicle (ZEV) Mandate but unfortunately, private new electric car sales are stalling. 

“In the previous edition of the report, we forecasted that manufacturers would use price competitiveness as a key lever to meet the mandate and now share some key examples where this has worked.

“Another tactic that’s becoming apparent in the data is a return to pre-registering.”

Plummer said this has been spurred on both by a return to the pre-covid push market and the ZEV Mandate.

He said: “The volume of pre-registered stock is growing quickly and electric vehicles make up a disproportionate amount of these cars.”

However, there is good news from the used EV market where demand has been stronger at the right price.

Plummer added: “While there are still consumer concerns about electric cars, and second-hand vehicles in particular, an uptick in the overall proportion of consumers who are considering electric cars gives us a bright spot to focus on for now.”