It’s a Buyer’s Market

Hundreds of new cars in parking lot.

Something interesting is happening in the electric vehicle market right now, and if you’re EV-curious or currently leasing an EV, it could work in your favor.

Across the country, thousands of EVs that were leased two or three years ago are now reaching the end of their leases. What happens next may create some of the best EV deals we’ve seen yet.

Here’s why.

When someone leases a car, they have the option to buy it at the end of the lease for a predetermined price. But in today’s EV market, that buyout price is often higher than the car’s current market value. As a result, many drivers are simply turning their vehicles back in instead of buying them.

Once returned, most of these EVs don’t stay on the dealership lot. They’re typically sent to wholesale auto auctions, such as Manheim Auctions, where dealers from around the country bid on them.

This is where the opportunity comes in.

Choose your dealership wisely

Because so many lease returns are entering the market at once, wholesale prices for used EVs have been falling. Dealers can sometimes buy these vehicles at auction for significantly less than what they cost new just a few years ago. If a dealership passes that savings along to customers, it can translate into some very attractive prices for buyers.

In some cases, drivers are finding lightly used EVs with plenty of range and modern features for thousands less than comparable new models. Some people are even able to find the exact same car – even the same color –and reduce their monthly payment significantly.

However, there’s an important catch: not all dealerships are created equal.

Some dealerships actively source vehicles from wholesale auctions and work hard to find the best possible deal for their customers. Others may price used vehicles in ways that don’t necessarily prioritize value for the buyer.

That’s why the dealership you work with really matters.

A knowledgeable and trustworthy dealer can search national auction networks and locate a specific vehicle for you – sometimes finding a better option than what’s locally available. Most buyers don’t realize that dealerships have access to these wholesale markets and can act as brokers to help locate the right car.

There are still incentives

Another factor that can make used EVs especially attractive right now is incentives. In Colorado, programs like Vehicle Exchange Colorado (VXC) offer rebates on qualifying used EVs, which can significantly reduce the final purchase price.

To qualify for VXC, you must be income-qualified (<80% AMI) and trading in a gas or diesel vehicle that’s at least 12 years old or that fails a Colorado emissions test. You’re then eligible for a point-of-sale discount of $6,000 toward a used EV with a final negotiated price of $50,000 or less.

Put these factors together – falling wholesale prices, growing supply from lease returns, and state incentives – and the used EV market starts to look very compelling.

If your EV lease is ending soon, it may be worth exploring your options instead of automatically buying out the vehicle. And if you’ve been curious about EVs but hesitant about the cost of a new one, a used EV sourced through a reputable dealership could be a great entry point.

If you’d like help navigating your options, please reach out. As a ReCharge coach working in Southwest Colorado, I talk with dealerships and track the EV market. I’m happy to help point people toward trustworthy dealers and share what I’m seeing.

The EV landscape is changing quickly – and right now, it may be creating a rare opportunity for buyers who know where to look.