Best-selling second-hand EVs saving drivers £1,600 a year
The Government’s ZEV mandate will play a crucial role in driving the second-hand EV market, allowing more families to benefit from cheaper and cleaner electric driving.
By George Smeeton
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New analysis from the Energy & Climate Intelligence Unit (ECIU) has found that the best-selling second-hand EVs of 2024 could save their owners an average of £1,600 a year compared to their petrol equivalents.
This comes on the back of news that the second-hand market for EVs has increased in size by 57% in the last year [1]. Autotrader recently stated that 3-5 year old EVs are the fastest selling segment of vehicles on their platform [2]. Crucially, Autotrader also revealed that price parity between second-hand EVs and their petrol equivalents has been reached [3].
This analysis also found that the Zero Emissions Vehicle (ZEV) Mandate – which requires car manufacturers to sell an increasing proportion of cars that are electric, and was introduced by the previous Government on 1 January 2024 [4] – is set to help save second-hand EV buyers billions of pounds on their driving bills.
Based on projections for sales in 2024, the new EVs sold in the first year of the mandate could collectively save drivers who go on to buy them second-hand up to £6bn over their remaining 10 year lifespan. New EVs sold under the mandate could collectively save drivers who go on to buy them second-hand approaching £40bn by 2035, based on current policies and projected energy costs. These second-hand savings have the potential to reach hundreds of billions of pounds by 2048, when the last of the EVs sold under the mandate will likely be scrapped.
Commenting on the analysis, Colin Walker, transport analyst at ECIU, said: “Increasing numbers of regular families are now trading in for an EV on the second-hand market, taking advantage of the hundreds of pounds of savings they can generate every year, and turning their backs on paying the ‘petrol premium’ of their old car.
“The previous Government’s ZEV mandate policy is working, with manufacturers discounting their EVs as they compete for sales to hit their targets. As prices are driven down, sales are going up. The increasing number of new EVs being sold today will hit the used market in around three to four years’ time, opening up the opportunity for cheaper and cleaner electric driving to a majority of people, as most people buy their cars second-hand.
“Any slowdown in the roll out of EVs under the ZEV mandate could cost British drivers millions, if not billions, of pounds in extra driving costs in the coming years.”
The analysis looked at the total costs of ownership of the six best-selling second-hand EVs on Autotrader in 2024 and compared them to their petrol equivalents. These costs include the vehicle’s upfront purchase cost as well as its fuel, maintenance, tax and insurance costs.
Exact savings vary by model, but the analysis shows that all six of the top selling second-hand EVs are hundreds, if not thousands, of pounds cheaper to run every year. The top-selling EV with the biggest savings compared to its petrol equivalent was the Audi e-tron, which will save its owner around £2,600 a year – or about £26,000 over its remaining 10-year lifespan – when compared to the petrol Audi Q5. Even the top-selling EV with the ‘smallest’ savings compared to its petrol equivalent, the Renault Zoe, will still save its owner an average of around £875 per year – or about £8,750 over the 10 years of its remaining lifespan – when compared to a petrol Renault Clio.
Of the six models analysed, the average total cost of ownership savings of a second-hand EV versus its petrol equivalent was £1,600 per year. These figures are significantly higher than when we last analysed the second-hand market in early 2023, largely because second-hand EVs are no longer more expensive to buy than their petrol equivalents.
Such savings may come as a surprise to many petrol car owners, since recent polling by YouGov for ECIU found that nearly two-thirds (62%) of petrol drivers believe it’s more expensive to own and run an EV. Only 14% correctly recognized that an EV’s total costs of ownership are typically lower [5].
The government’s Zero Emission Vehicle (ZEV) Mandate came into force on 1 January 2024 and requires manufacturers to sell an increasing proportion of electric vehicles over the coming years. The EVs sold under the mandate will have a crucial role to play in supplying the second hand market. This is where 82% of car sales take place [6], and will be crucial in enabling millions of households to make the transition to electric driving.
ECIU’s analysis found that the cumulative savings generated by the EVs sold under the mandate – from 2024 to 2035 - once they become second-hand, could approach £40bn by 2035.
A recent report by CBI Economics, commissioned by the ECIU, set out the consequences for the UK’s car industry should it be slow in making the transition to manufacturing EVs [7]. The contributions made by the sector to the UK economy could fall by as much as 73%, or £34.1bn, with over 400,000 jobs potentially lost should EV production levels stagnate. Conversely, economic output could increase by over £16bn, and 167,000 new jobs could be created, if the transition is fast. Government support is critical in avoiding such an outcome, and this includes the provision of a stable and supportive regulatory environment through keeping measures like the ZEV Mandate in place.
ENDS
Notes to editors:
[1] https://www.smmt.co.uk/2024/11/pre-loved-evs-soar-to-record-levels-as-used-car-market-goes-green/
[3] https://plc.autotrader.co.uk/news-views/press-releases/retail-price-index-september-2024/
[4] https://www.gov.uk/government/news/pathway-for-zero-emission-vehicle-transition-by-2035-becomes-law
[6] https://www.statista.com/topics/2190/the-uk-used-car-industry/
[7] https://eciu.net/analysis/reports/2024/electrifying-growth
The top-selling EVs were identified from Autotrader data of second-hand car sales for YTD 2024. The model comparisons in this analysis were Tesla Model 3 vs BMW 320, Jaguar I-Pace vs Jaguar E-Pace, Nissan Leaf vs Nissan Juke, Kia Niro vs Kia Sportage, Audi e-tron vs Audi Q5, and Renault Zoe vs Renault Clio. As the average lifespan of a car is 14 years, and new cars are usually sold on after four years, costs were modelled for the remaining 10 years of each model’s life as a second-hand car. This modelling was based on a combination of current costs (the upfront costs of the car, Vechicle Excise Duty, service and maintenance charges, insurance and MOT), known policy changes (the introduction of VED on EVs in 2025), and projected energy costs (petrol and electricity). Cumulative second-hand lifetime total costs of ownership were calculated and averaged out over the ten years, and then compared to costs for the equivalent petrol model. The total savings from EVs sold in 2024 was based on the SMMT’s most recent forecast that 1.968m cars sales will be sold in 2024, and applying New Automotive’s estimation that EV sales will reach 19% market share for the year.
For more information:
George Smeeton, Head of Communications, ECIU, Tel: 07894 571 153, email: george.smeeton@eciu.net