The electric vehicle (EV) market is rapidly expanding in the US, with sales of new EVs projected to reach a record high in the first quarter of 2023. As more people make the switch to electric vehicles, the market for used EVs is beginning to see rapid growth. Sales of used electric vehicles through licensed dealerships were up 32% in the first three months of the year, to nearly 43,000, according to data from industry analyst Cox Automotive.
The average listing price for a used EV was around $43,400, down 4% from prices at the start of 2022 and well below the average price of a new electric vehicle. Used EV sales are expected to increase rapidly, following the path set by new EV sales. Cox predicts new sales of EVs will exceed 1 million cars for the first time in 2023.
The Biden administration’s efforts are fueling the uptick in EV sales. Tax credits for new and used EVs are laid out in the Inflation Reduction Act of 2022. People can claim a tax credit of up to $4,000 for used plug-in electric or fuel-cell EVs purchased in 2023, with restrictions that the car must be at least 2 years old and the credit can only be claimed once in a vehicle’s lifetime.
The US Environmental Protection Agency is expected to propose rules on Wednesday to increase the sales of all-electric cars in the country. The proposed rules aim to make all-electric cars account for up to 67% of new passenger vehicles sold by 2032. This would be a significant increase from the current sales of EVs, which are expected to reach almost 7% of all new car sales in the first quarter of 2023.
The proposed rules would encourage car manufacturers to increase production of EVs and reduce emissions from traditional gas-powered cars. With the rising demand for EVs and the incentives offered by the government, the future looks promising for the EV market in the US.