Used battery electric vehicle prices fall as supply continues to grow
Our INDICATA system has identified that towards the end of 2020 supply exceeded demand which in turn has slowed down stock turn.
Petrol and diesel stock turn is faster
BEV and hybrid stock turn in January across Europe was on average 3.4 and 3.8 respectively, while petrol and diesels were selling much faster at 4.9 and 5.6.
One of the main reasons for oversupply is the OEMs gain a €26,000 reduction in Corporate Average Fuel Economy (CAFÉ) penalties for every new BEV sold. This has become a massive incentive to supply cars into the new market, which is in turn is quickly feeding BEVs into the used market.
BEV residuals come under pressure
CAFE standards are calculated by a production-weighted average of mileage ratings across a manufacturer’s fleet; they are not based on data from actual on-road performance.
BEV residual values are also under pressure from a number of fronts:
• Unrealistic price premiums versus petrol and diesel equivalent models
• Consumer fear factor on remaining life left in the batteries
• Slow charging infrastructure growth
Talking to the recent European Networking Group conference INDICATA and MarketPlace’s business unit directors Andy Shields and Morten Holmsten represented Autorola Group’s views alongside other senior executives from the remarketing industry.
BEV pricing pressure extends across Europe
They said: “There is price pressure on BEVs in all European markets. Dealers have increased their stocks of used BEVs in response to strong consumer demand, but until prices move closer into line with equivalent petrol and diesel cars then sales will be compromised.
“Used supplies of BEVs are going to continue and we may see some cars being sold cross border as countries balance supply and demand. Meanwhile, dealers have to operate a pricing policy to accelerate demand and balance BEV stock with petrols and diesels to satisfy consumer demand.”
Click here to get back to all News