The Expert Podcast

Good deals on used cars are becoming harder and harder to find. Over the course of three years, from 2020 until 2023, there was a very severe shortage of new cars being manufactured. What that means is the used cars that normally would be coming into the marketplace for the last few years are few and far between. Because there weren't many new cars sold for three years, there's not a lot of used cars coming out in the marketplace.

Where you might still be able to get a great deal is on used EVs. According to the New York Times, used electric vehicles have fallen sharply in value. Supplies are higher because many people bought an EV as a second vehicle or a third vehicle and maybe don’t need that car anymore. Or perhaps there were more sold than people actually wanted. There are actually some deals to be had, and in many states, there are still incentives and government handouts for these types of vehicles. One example is part of the climate law passed last year, which includes a tax credit of up to $4,000 on a used electric vehicle, according to the New York Times.

Time might be right to consider a used one. The high cost of a new one is keeping people away from buying them, but used ones are still not caught up with the inflation. Used battery-powered models are 28% less expensive than a year ago, whereas regular used cars as a whole are only 7% cheaper. So, used EVs went down even more. If you’re shopping around and an electric vehicle would fit your lifestyle and needs, don’t necessarily rule it out.

The only thing to keep in mind is that, at some point in the future, there might be taxes charged by the mile instead of by gas. Right now, road taxes go by a cents-per-gallon tax that’s added at the gas pump when you pump gas. Part of that, depending on your state, could be 10, 15, or 20 cents per gallon that goes to the government. As fuel taxes plummet, partially because of EVs, some states are going to charge by the mile. That may start with EVs and then gradually transition to gasoline vehicles, so keep that in mind as a potential downside to an electric vehicle in the future.

For the time being, if you’re looking for a deal on a used car and you can’t find a good gasoline combustion engine vehicle, don’t rule out used EVs until you look and see how cheap you can actually get one.