Used Electric Car Sales Hit A Record High In March

The U.S. secondhand electric vehicle market reached a record high in March, with sales totaling 42,924 units, representing a nearly 28% year-over-year increase. This growth occurs as the new EV market experiences a nearly 25% decline in the same period, signaling a significant divergence in consumer behavior. The surge suggests that the used market is effectively overcoming the expiration of federal tax credits by offering more affordable entry points into electric mobility.

According to industry data from Cox Automotive, the nearly 43,000 used EVs sold in March surpassed the previous record of 40,960 units set in August during a period of high tax-credit activity. From October through February, monthly sales had stabilized around 30,000 units, but the March figures indicate a strong rebound that suggests the market has moved past the post-tax-credit hangover. This recovery is particularly notable because it occurred despite the expiration of federal incentives that previously provided up to $4,000 for used vehicles priced under $25,000.

In contrast, the new EV market continues to face headwinds, with March sales of approximately 83,000 units marking a 25% year-over-year decrease. While new EV sales did see a 20% month-over-month gain, they have struggled to recover since the $7,500 federal incentive program ended, which initially caused a 50% drop in sales. The divergence is further widened as some automakers shift their focus back to internal combustion engines and reduce their new electric offerings, making the secondhand market a primary destination for budget-conscious buyers seeking modern, long-range electric options.

Supply chain dynamics and external economic pressures are fueling this secondhand growth, with Stephanie Valdez Streaty of Cox Automotive citing high gas prices as a major influence on consumer demand. The market is currently seeing an influx of modern EVs as early leases expire and vehicles return to dealerships, providing a robust inventory for shoppers. This trend is expected to accelerate, with Recurrent projecting that over 1 million EVs will come off lease within the next two years, providing a steady stream of two-to-three-year-old electric cars for the growing used market.