Electric Dreams

Electric Dreams

The used electric car market is in free fall.  This peculiar situation began towards the end of summer 2022 and can be attributed to a ‘perfect storm’.  Electric cars have been more readily available brand new than their combustion counterparts, energy costs were spiralling, government support is fading, the press was highlighting the practical problems with electric cars and finally Tesla had already announced a reduction on the new list price in China.  The price reduction on new came into effect in January 23 in the UK, but it’s plausible that industry experts such as CAP were already factoring this in.

What we also saw was panic from both customers and dealers.  Customers were seeing first hand the usability issues and dealers were seeing massive, unprecedented drops in CAP.  We also saw other data experts such as Autotrader adjusting their algorithms.  For example, in September 2022 a Tesla Model 3 had a rating of (depending on location) late 90’s out of 100.  By November this had dropped to less than 5!

With bad press, less support, more supply and falling used car prices it is understandable that the electric dream seems to have collapsed.  However, it has signalled an opportunity.  Electric cars now represent excellent value for money.  A 2019 Tesla Model 3 Standard Range, in less than 9 months, has dropped from a retail price of around £40,000 to around £26,000.  It’s suddenly a really well equipped, fast and spacious family hatchback for a much more sensible price.  Especially when you factor in increases in Q1 of 2023 for a lot of the traditional combustion engined vehicles.  At anycolourcar.com, we are proud to have continued to buy and retail electric cars throughout this period and being able to pass these massive reductions on to our customers.  The key is to move the stock quickly!

It is important that as an industry we take this negative spike as a lesson.  It is vital that we take responsibility to fully explain all the downfalls to our customers and to most importantly make sure they are doing the right thing going fully electric.  There are so many reasons a customer will not get their expected range; weather, temperature, usage of in car features, battery degradation and of course driving styles.  We have a duty to point this out and not just refer to the brochure!  Our customers also deserve to be aware of the restrictions due to infrastructure.  Many, many customers would benefit from using electric both from a tariff point of view and based on their usage.  Others, it is just not ready for them.  I looked at electric until I researched the realistic distance from a full charge coupled with the infrastructure in and around the places we vacation.  It would not work for us.  However, it would be a great option for me to commute to and from the office.

In reality the electric dream is still alive, but we need to pass the savings on to our customers, turn our stock quickly and most importantly of all we have to be honest, transparent and upfront with potential customers.  At anycolourcar.com we have a fact sheet we ask customers to read and sign before they agree to buy an EV, it gives them a breakdown of all the pitfalls and it means we know that customers who buy an EV are doing the right thing.

We are not ready to see the total end of combustion, not yet, but we don’t need to be fearful of used EVs.  In fact we need to educate our teams and take advantage of the price realignments.  It’s not the end of the road, nor is it the complete solution (yet), but we have a responsibility, as the progressive industry that we are, to understand it and be able to fully inform our customers.