Forecasting the Future: Used EV Values in 2024
The electric vehicle (EV) market has been on a roller coaster ride over the past 18 months, with significant fluctuations in used EV values. Dylan Setterfield, head of forecast strategy at Cap HPI, provides insights into what we can expect for the EV market in 2024.
Setterfield notes that the used market for battery electric vehicles (BEVs) has been highly complex, with prices experiencing eye-watering decreases starting over 18 months ago. However, there have been signs of improvement, with BEVs down -21% year over year at 36/60, showing a slowing rate of decline compared to previous months.
Despite the challenges faced by the EV market, Setterfield remains optimistic about the future. He highlights that the volume of BEVs in the market is expected to increase in the coming months, with many models now attractively priced following previous reductions. Buyer demand is back to previous levels, especially for models at the lower end of the price spectrum.
Setterfield also discusses the new car market, noting that discounts on existing BEV models have resulted in prices well below the list price. The zero emission vehicle mandate, requiring OEMs to meet a minimum proportion of 22% BEVs this year, is also expected to impact the market.
In terms of remarketing trends, Setterfield points out the extreme variation in performance among individual BEV models, with nearly new used values now back well below cost new. Despite this, he expects the market to stabilize in the coming months, with improvements in used values as overall supply decreases.
Looking forward, Setterfield predicts that supply and demand for BEVs will continue to fluctuate, but consumer desire to reduce emissions remains strong. Factors such as new Clean Air Zones and increases in fuel prices are expected to further fuel demand for lower emission vehicles.
Overall, while the EV market has faced challenges in recent months, Setterfield’s prognosis for 2024 is cautiously optimistic, with signs of stabilization and potential for growth in the coming months. As the market continues to evolve, it will be interesting to see how these trends play out in the months ahead.