If you’re in the market for an electric vehicle, should you consider a used one? A used electric car might seem like a good idea for shoppers who don’t want to pay up for a new model.
Are There Tax Incentives for Used EVs?
When you buy a used electric vehicle, you will miss out on some excellent tax benefits of buying new. It’s widely known that car shoppers who choose a new electric vehicle can take advantage of a range of tax incentives. Most importantly, there’s a $7,500 federal income tax credit on most EVs, which is highly enticing to many shoppers.
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Some states also offer additional state income tax credits, with a few generous ones even coming close to the federal figure. That can help make it a lot cheaper to buy an electric vehicle than what the MSRP suggests.
Unfortunately, the federal government does not offer tax incentives when you buy a used electric vehicle. As a result, a used Nissan Leaf or Chevrolet Volt will cost what you negotiate at the dealership or with a private seller. You would not save a penny when tax time comes.
How to Find the Electric Car Perks
However, used EV buyers can still take advantage of some perks on a state level. Some states offer cheaper registration for EVs, carpool lane access, and a tax credit for installing an electric car charging station in your home. Some cities even give free municipal parking to EVs.
Although you might not get help from your local or state government when buying a used EV, some power companies offer rebates as a reward for contributing to reduced gas consumption. For example, Edison International offers a Clean Fuel Reward Program for new and used EVs and plug-in hybrids. You can go on their website and confirm your eligibility, fill out a form, and get up to $1,000 back.
This specific offer only applies to Southern California Edison residential customers. But, a few other programs like this could be in your area and would be worth researching.
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For some shoppers, however, the lack of a tax credit isn’t necessarily a bad thing. After all, if the purchase price of one of these vehicles comes in low enough, buying used may still save a lot of money compared to buying new, even if you factor in the lost tax savings.
Shoppers who don’t live in a state with heavy tax incentives may not even see much of a difference between new and used pricing. Find a used electric car for sale near you
Do the Batteries Need to be Replaced?
Another issue many drivers get concerned with: battery life. More specifically, many drivers are worried about whether they’ll have to replace the batteries in an electric car — an unfortunate reality that could lead to a four-figure repair bill.
The short answer is that, yes, an electric vehicle’s batteries will eventually need replacing. However, it’s unlikely that you’ll be the one replacing them unless you keep the car for many years.
The battery is likely to last well over a decade — and since the first Nissan Leaf models came out in 2010, that means even the earliest batteries will need replacement a decade later. Batteries that fail prematurely get covered by most EV warranties, which typically last up to 10 years.
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What is the Resale Value of EVs?
The resale value of EVs is generally below average. Electric and plug-in hybrid cars depreciate faster than the average gas-powered car, which is good news for used car shoppers. But it’s bad news for car buyers who paid a lot for a new EV without a lot of help from their state government.
However, newer, longer-range EVs like the Tesla Model 3 hold their values better than earlier examples of electric cars with lower range numbers. If a used electric car gets more than 200 miles of range, the vehicle will likely hold its value better.
As of this writing, it’s challenging to find a used electric car under $10,000 due to tight inventories. But, when you raise that budget to $15,000, you’ll likely see more options.
So, setting a pretty modest used car budget can get you a nice, modern electric car with plenty of life left in it. You won’t get a tax credit on your used EV, but the purchase price of used EVs is generally low enough that it doesn’t matter. Not to mention what you’ll save in gas money.
Will the EV Lifestyle Work for You?
If you’re shopping for a used EV, there’s a good chance that means you’re making the big switch from a traditional gas-powered car to your first EV. Unless you’re going with a plug-in hybrid also powered by gas, the big EV switch requires a lifestyle change with a few things to consider.
- Range anxiety. While a concern, going the distance is constantly being engineered away in new EVs with extended range. But if you’re shopping for a used EV, you will want to think about range. Some used EVs offer a range as low as around 100 miles. So you need to ask yourself, would you be able to use a car that can’t travel beyond 100 miles at a time? This requires a little homework on your part to determine how much range you realistically need and which used EVs can provide that range.
- Charging. Where to plug in your electric vehicle is another consideration. Do you have a garage where you can keep your car plugged in when at home? Can you use a regular outlet to meet your charging needs, or will you need to install a faster Level 2 charger? Most used EVs can get a full charge overnight with a traditional 120-volt outlet, but a more sophisticated Level 2 charger can significantly reduce charging times. If you live in an EV-friendly city with many public charging stations or if your employer offers some charging stations in the parking lot, those perks can go a long way in making EV life more convenient.
Should You Buy a Used Electric Car?
Between the affordable purchase price and the amount you’ll save in gas by switching to electric, a used EV brings a pretty strong value proposition as long as you can handle the necessary lifestyle adjustments for EV life. If you’re concerned about battery life, we suggest not worrying about it just yet unless you’re looking at very early EVs that are 10 years old; most batteries have years of life left in them.
As for frugal shoppers interested in buying an EV to save money: Before signing the papers on a used EV, check your local tax laws, and check out new EVs on Autotrader. If your state has significant EV tax incentives, you might be surprised to learn that a pre-owned model can cost about the same as a new one. Find a used electric car for sale
Related Used Hybrid and Electric Vehicle Articles:
- Buying an Electric Vehicle: 7 Tips for First-Time Buyers
- Should I Charge My Electric Car Every Night?
- Hybrid Battery Replacement: When Can You Expect It?
Editor’s Note: This article has been updated for accuracy since it was originally published.