Almost 22,000 used electric cars were sold in July, nearly three times more than in the same month of 2023. But this rise isn’t entirely positive. It’s being fuelled by a growing imbalance between the number of EVs available and the demand for them, which is causing prices to fall sharply.
A two-year-old EV is now typically worth less than half of its original value. By comparison, petrol, diesel and hybrid models are still holding onto around three-quarters of their first purchase price.
Several factors are behind this shift. The Labour government confirmed that EVs will be taxed for the first time from April 2025. At the same time, carmakers are delaying new EV launches because sales of brand-new models are growing more slowly than expected. Hybrids have also received a boost since ministers confirmed they will still be available until 2035, five years longer than petrol and diesel cars.
The result is that hybrid demand is climbing while used EV values are falling.
Looking at the numbers shows just how fast the market is changing. Since July 2023, used EV stock has increased by 149 per cent, rising from 21,995 cars to 54,720. Sales have climbed even faster, jumping 192 per cent to reach 21,902 in July 2025. Prices, however, have not kept up. The average advertised price of a used EV has dropped 19 per cent in two years, falling by more than £5,000 from £27,762 to £22,547.
Petrol cars tell a different story. Stock levels have risen and sales are up 40 per cent compared with two years ago, but prices have stayed relatively stable, slipping by less than 5 per cent.
For buyers, this means that EVs are suddenly far more affordable. Experts say second-hand buyers can now pick up a more premium electric model for the same money they might have spent on a mid-range petrol car.
Residual value comparisons highlight the shift even more clearly. A two-year-old EV now retains just 46 per cent of its original list price. Petrol cars keep 64 per cent, diesels 65 per cent and hybrids perform best at 66 per cent. Only two years ago, EVs were holding their value almost as well as hybrids, so the change has been dramatic.
Industry experts say hybrids currently offer a strong balance of cost-effectiveness and practicality, while EVs are seen as poor value when new but excellent value on the used market.
Tax is also changing the picture. From April 2025, EVs registered after April 2017 will face the standard annual road tax of £195, matching combustion cars. New EVs priced above £40,000 will also be subject to an additional £425 luxury tax for five years, bringing the annual bill to £620. There are suggestions that this threshold could be raised to reflect the higher average cost of electric cars, but nothing has yet been confirmed.
For now, buyers in the used market are in a strong position. Falling values mean EVs are more accessible than ever, even if new car owners are feeling the pinch of heavy depreciation.
