Demand for electric vehicles (EVs) is growing rapidly. According to the U.S. Bureau of Labor Statistics (BLS), EV sales in the U.S. increased from a mere 0.2% of total car sales in 2011 to 4.6% in 2021.
At the same time, the supply of EVs is limited. For one, historically low market share has forced EV manufacturers to be careful about production levels. On top of that, recent supply chain issues that affected the broader car market also impacted EV battery production.
For younger generations, among whom EVs are most popular, this presents a unique challenge: How do you buy an EV when supply (and likely your income) is limited?
The answer is to buy a used EV. Buying used EVs lets younger buyers take advantage of lower prices without giving up on their desire to support a cleaner environment. So if you are a young buyer looking to buy your first used EV, here are some tips you should follow:
1. Choose the right EV model
Try to narrow down your choices by settling on one or two EV models. The model should be at least two years old in order to minimize the initial depreciation hit from buying a newer car (typical depreciation within the first year is 20%).
Some examples of EV models that are a few years old include the Nissan Leaf and the discontinued Kia Soul EV and VW e-Golf. These may not be as new as other models out there, but they can provide the best bang for your buck.
To know whether you’re getting a good price on a used EV model, check online pricing guides. You may also want to consider looking at certified pre-owned EV models since these tend to have lower interest rates when financed.
2. Check the EV battery
The heart of an EV is its battery. This is the most expensive part of the car. As a result, you should check the EVs battery condition before deciding to buy. You can do this by requesting a battery health report from the seller or taking the EV to a mechanic that performs EV battery tests. You can also learn a lot about an EV’s battery from the car’s dashboard. It shows the total battery capacity and what range the car can get on a full charge (which may or may not be enough for how you plan to drive).
A key question here is to what extent the EV’s battery has degraded. The average EV battery degradation is 2% per year, but this will vary with factors such as weather and how the battery was cared for.
Ask the seller when the battery was last replaced and request documentation to confirm. You may also want to ask how often the battery was charged to 100% as this can speed up battery degradation. If possible, avoid EVs that were driven in hot climates, as this can be another drain on battery life.
Once you know the condition of the EV battery, you can use this information to haggle for a better deal or simply walk away.
3. Buy from a used car dealership
Consider buying a used EV from a reputable used car dealership. This has many benefits over buying from a private seller:
For one, you may be eligible for more tax breaks. For example, in most states, if you trade in your old car to the dealership, the trade value is subtracted from the sale price and then sales tax is calculated from that amount. A trade-in with a value of $5000 in a state where the sales tax rate is 7% would save a person $350 in sales tax.
In addition, many dealerships offer warranties. You’ll want to check the warranty terms, but in most cases, the EV battery will be covered for a certain time frame or mileage amount.
According to Tiger Okeley at used car dealership Oak Motors, “Getting a dealership warranty on a used EV is huge because it allows you to not worry about a faulty EV battery, which is a serious risk.”
4. Take the EV to a specialized mechanic
It’s important to take your EV to a mechanic for a few reasons. First, getting a professional inspection can inform you of any issues and red flags with the car. Second, a mechanic can give you a better idea of the true value of the car, which can put you in a better position to negotiate for a better price (or walk away).
That said, try to find a mechanic who specializes in EVs. A general mechanic may not understand the EV powertrain very well and will be less helpful as a result. You want to talk to someone who is deeply familiar with how EVs work.
5. Don’t be afraid to shop out of state
Finally, don’t be afraid to shop for an EV out of state. You may find that other states have more favorable sales tax rates, which can reduce the total price of buying a used EV. But perhaps more importantly, some states may have a higher supply of EVs, which could mean more selection and lower prices.
For example, California probably has the most used EVs of any state due to state laws that incentivize buyers to buy EVs (e.g. via tax breaks). So if you travel to California, you may find a better deal on a used EV than you would in your home state.
The bottom line
No matter how you slice it, finding a good deal on a used EV as a young buyer in the current market can be tough. But by following the tips above, you’re much more likely to be successful. So do your due diligence and eventually, it’ll pay off.