Decline in Used Electric Vehicle Prices
The market for pre-owned Tesla Model Y vehicles is active on Tesla’s own website. The trend of depreciating used electric vehicle (EV) prices is ongoing, mirroring a general downturn in automotive costs. Kelley Blue Book reported that the average price for new vehicles in the United States during January was $47,401, a decrease of 2.6% from December 2023 and a 3.5% reduction from January of the previous year. New EVs saw an even steeper decline, with their average price dropping by 10.8% from the year before, settling at $55,353 in January 2024.

Impact on the Pre-Owned EV Market
The pricing trends for new vehicles significantly influence the used EV sector, which has expanded rapidly due to an influx of vehicles at dealerships. Liz Najman, the lead researcher at Recurrent, conveyed via email that used EV prices have seen a 24% drop year over year as of February, with Tesla models experiencing the most significant depreciation within that timeframe. Najman noted that Tesla’s depreciation rate has surpassed the industry average and that of competitors like Ford, Nissan, Chevy, and VW in recent months.

Tesla, Audi, and Jaguar have faced the largest price reductions year over year, including models such as the Audi e-tron Sportback, Tesla Model X, Model Y, Audi e-tron, Jaguar IPACE, Tesla Model 3, and Model S. Since January, the Hyundai IONIQ 5, Kia EV6, Tesla Model 3, and Model Y have led the price drops. Tesla’s used car website now lists Model Ys starting at under $30,000, while Hertz is offering Model 3s at prices below $20,000.

The Chevy Bolt’s Significant Price Decline
As a stark example, the used Chevy Bolt, which was the third best-selling new EV in the U.S. last year, has seen a 30% price reduction year over year. One individual experienced this firsthand when they received an offer of roughly $28,000 for their 2021 Bolt at CarMax in Los Angeles in September 2022, only to have that offer plummet to $14,000 in February of the following year, marking a 50% decrease. Another person who bought a new 2023 Chevy Bolt EUV Premier Redline in January for $38,950 witnessed the price drop to between $23,500 and $25,500 for private sales, and $21,000 for trade-ins, despite the vehicle being nearly new with only a few hundred miles on it. This pattern of rapid EV depreciation is not exclusive to the Bolt.

The $7,500 point-of-sale tax credit available for new EVs in the U.S. as of 2024 may be contributing to the steep depreciation. For instance, the aforementioned Chevy Bolt EUV was purchased with the $7,500 credit applied after taxes and fees. However, individuals who bought used EVs did not receive this credit, yet it appears to affect the pricing of all used EVs to some extent.

Stabilizing Prices for Used EVs?
Recurrent’s Najman suggests that the decline in used EV prices may be stabilizing. The average price drop across all brands from January to February was 2.5%, a slight decrease from the 2.9% drop observed from December to January.

Used EV Tax Credit Opportunity
For those considering a used EV purchase, it’s important to remember the potential tax credit. The IRS states that purchasing a qualified used electric or fuel cell vehicle from a licensed dealer for $25,000 or less could result in a credit of 30% of the sale price, up to a maximum of $4,000. This could effectively reduce the cost of a $16K used Chevy Bolt to around $12,000, or a $20,000 Tesla Model 3 to approximately $16,000.