It’s a bit upside down in the used car market. Usually, a vehicle depreciates as soon as it leaves the dealership, but today, used vehicles sometimes look like investments, particularly certain models of electric cars.
For example, last December, the average price of a used Tesla Model S increased by 41% compared to December 2020 according to data from an analysis carried out by the vehicle sales platform AutoHebdo.
The increase in the value of used vehicles is unheard of
launches Benoît Béland, chief marketing director of AutoHebdo.
« Dealerships are snapping up our used vehicles. »
And this is particularly the case for electric vehicles, specifies Mr. Béland.
In Quebec, searches for electric vehicles on the AutoHebdo site increased by 85% in March 2022 compared to the same period last year and the number of consumers who are thinking of plugging in and asking for information to dealers via the AutoHebdo platform increased by 1218% in one year!
In a context where prices are soaring and where supply no longer meets demand, we must be particularly careful and analyze prices carefully, suggests the senior marketing director of AutoHebdo.
On our platform, we have an algorithm that will compare all the prices of similar models in real time, so if we refine our search, it’s super easy to see if the price that is asked is above the average or below average
says Benoît Béland, who adds that even in this unprecedented context, there are good opportunities for consumers who take the trouble to use the right tools and to search carefully.
Profitability
CAA-Quebec automotive expert Jesse Caron gave a lecture on the myths and realities of electric vehicles and another on buying such a used vehicle at the Montreal Electric Vehicle Show this weekend .
According to him, buying an electric vehicle, new or used, is generally more profitable than buying its gasoline equivalent.
« It’s true that the price difference can be quite marked at the time of purchase, that may be a brake, but the slightest bit that you drive with an electric vehicle, you start to make it profitable after a few years. »
Jesse Caron supports his statements with very recent data analyzed by his team in anticipation of the Montreal Electric Vehicle Show concerning used vehicles.
These estimates indicate, for example, that an electric 2016 Kia Soul costs almost $6,000 more than its gas-powered version on the second-hand market, but it avoids spending an average of $2,750 on fuel per year. The electrified version therefore becomes a ‘best deal’ after just over two years.
A hybrid vehicle.
Photo: Radio-Canada / Ismaël Amodeo
Still according to CAA’s analysis, you have to pay about $3,600 more for a 2018 Mitsubishi Outlander plug-in hybrid than for its gas-powered equivalent. However, the plug-in hybrid version saves an average of $1,700 in fuel per year, so it becomes ‘more profitable’ after two years.
Conventional hybrids are also more advantageous, to a lesser extent, for consumers who wish to keep their vehicle for several years. For example, a 2017 Toyota RAV 4 Hybrid has a market value of about $5,000 more than its gasoline-only equivalent, but it saves an average of $770 in fuel per year. The hybrid version of this used vehicle therefore becomes more economically attractive after approximately 6 years.
Have the battery analyzed
Jesse Caron strongly advises consumers to have the battery of the used vehicle they intend to buy analyzed before concluding a transaction.
As they age there is a loss of battery life which is natural, batteries degrade over time
indicates the CAA automotive expert, specifying that this is particularly the case for the first electric vehicles which arrived on the market ten years ago.
It is possible to check the status of a battery by looking at the screen of some electric vehicles, but this method has limitations.
Relying on the bars on the screen may be an option, but it’s better to find a workshop that will do an examination with devices that will precisely measure the percentage of battery degradation
emphasizes Jesse Caron, adding that simply relying on the information on the vehicle screen it’s like doing a visual examination of a vehicle without having it inspected by a mechanic
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An electric vehicle being recharged at the Matane fast-charging station.
Photo : Radio-Canada / Isabelle Damphousse
If you need to change the battery of an electric vehicle, which is very rare
according to Jesse Caron, CAA recommends dealing with the original manufacturer and avoiding using a third-party supplier.
According to AutoHebdo, two-thirds of Quebec consumers consider that their next vehicle will be an electric vehicle. In order to determine whether it is the hybrid, plug-in hybrid or fully electric formula that is appropriate, it is better to ask yourself about the real needs in terms of autonomy and the type of trips you plan to make. We must also take the time to analyze the subsidies offered by the various governments.
In Quebec, only certain models and years of used vehicles may be eligible for the rebate. Subsidies may also differ depending on the value of the vehicle and the capacity of its battery.