According to a study published Jan. 27 and sponsored by the Responsible Battery Coalition, the Michigan State Department of Labor and Economic Opportunity and the University of Michigan’s Electric Vehicle Center, used electric vehicles as old as three years are less expensive than new or gasoline-powered cars with a 10-year lifespan.
Factors in the study included the purchase price, the cost of adding a Level 2 home charger, ongoing ownership costs such as refueling, insurance and routine maintenance, and the final value of the vehicle after it is ten years old. While the price of a full-fledged EV is much lower than that indicated by the window sticker when new, the study found that the steep price drop in the first three years is offset significantly later on. Prices then follow the same trend as equivalent gas or hybrid vehicles. And anything with a gas engine has higher maintenance costs for the remaining seven years of ownership, requiring a greater outlay for the owner as the vehicle gets older, a difference of $3,700 for some vehicle types.
The study did not focus on particular models, but rather the mix of models within a specific vehicle type, but given that many EVs or hybrids are comparable to gas-powered compact and midsize SUVs, and are among the most popular vehicle types sold in the US right now, the savings over the expected 10-year life of a vehicle was determined to be between $6,700 and $13,000 in favor of a fully electric vehicle.
The study’s findings are especially important now as analysts predict a large number of used cars, three-year-old, off-lease EVs, will become available this year. Tyson Jomini, J.D. Power’s senior vice president of data and analytics, told Gizmodo a month ago that it will be a buyer’s market for used EV buyers because of heavily subsidized leases for cars like the Tesla Model Y and Volkswagen ID.4, and discontinued cars like the Ford F-150 Lightning and Nissan Ariya.
“Dealers will still want to get those cars off their lots,” Jomini said.
According to S&P Global, the average age of a car on US roads is close to 13 years, and some of the oldest Nissan Leafs and soon-to-be-discontinued Tesla Model S examples are also around the same age, and topping 200,000 miles. Consumers have already deemed the Tesla Model 3 and Model Y to be good values as early owners snap them up as quickly as possible. That said, there will likely be a lot of good EVs in heavy supply in 2026 that salespeople can’t wait to get rid of, which is good news for most buyers.
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