EV prices aren't following the 'law of used cars,' analyst says — what it means for buyers and sellers

Used electric vehicle prices have defied the traditional depreciation curve this year, rising rather than falling as the "law of used cars" typically dictates. Analysts attribute this counterintuitive movement to two primary drivers: growing affordability pressures among consumers and sustained elevated gasoline prices.

Historically, used vehicle prices depreciate steadily after purchase. The EV market disrupts this pattern. Used EV inventory remains constrained despite growing new EV production, creating supply-demand imbalances that support valuations. As new EV prices have moderated following the initial rush, used models have become relatively more attractive to price-conscious buyers.

Gasoline prices, though down from 2022 peaks, remain elevated compared to pre-pandemic levels. This dynamic shifts the total cost of ownership calculus in EVs' favor. Consumers calculating fuel and maintenance savings over vehicle lifetime find used EVs increasingly competitive against used combustion-engine vehicles, even at rising prices.

The trend carries implications for both buyer and seller economics. Used EV buyers face less favorable depreciation than traditional vehicle purchasers might expect, reducing long-term value retention benefits. However, sellers benefit from stronger resale values, particularly for vehicles under five years old.

Fleet operators and dealers adjusting inventory strategies must recalibrate pricing models built on historical depreciation patterns. Rental car companies, which significantly influence used vehicle supply, are holding EVs longer before liquidating them, further constraining secondary market availability.

Market analysts note this dynamic may not persist indefinitely. As new EV production scales and battery technology costs decline, manufacturers will release more affordable base-model options, eventually increasing used EV supply. That influx would likely normalize depreciation curves. Until then, used EV prices remain in a temporary bull market. Investors monitoring automotive retail stocks and used-car marketplaces like CarMax and Vroom should track used E