Used EVs Are in Hotter Demand Than Ever

Environmental advocates say the tax credits could make EVs—new and used—more attainable for people with moderate incomes. They argue that EVs need to be more than a luxury commodity that’s been subsidized mostly for the rich.

And yet local programs have struggled to attract takers, even among low-income residents. Oregon’s clean vehicle rebate program, begun in 2018 for low- and moderate-income households, has seen just 516 buyers opt for used EVs, or about 5 percent of the vehicles purchased through the program. The rest bought new models.

Alejandra Posada, who manages the used EV rebate program for Peninsula Clean Energy, an electric utility in San Mateo, California, cites several reasons for the slow uptake. Most participants in that program, which launched in 2019 for low-income residents, were looking for cheaper vehicles that left them few EV options with extended range. Those buyers were often single-car households and wanted an EV as their primary vehicle—not as a second car for puttering around town, a more common situation for wealthier buyers. Over the first two years, around 30 of the program’s 100 or so takers opted for fully electric cars, Posada says. Most instead opted for plug-in hybrids, which typically have a few dozen miles of all-electric range before a gasoline engine takes over.

“It’s a high-touch job,” Posada says of setting people up with used EVs. That includes helping people navigate other incentive programs to make the costs more reasonable. She talks through their uncertainties about batteries and range and the logistics of charging. Many people don’t know, for example, that they can plug an EV into a standard outlet.

Plenty of Americans are confused about the basics of EVs, says Jeff Allen, the executive director of Forth, an advocacy and research organization focused on electric mobility. A question he still hears from drivers: “‘Can I take it safely through the car wash? Spoiler: Yes,” he says.

Fears about EV batteries are diminishing, too. “The batteries in these cars have really outperformed what [car companies] thought they would do,” says Luke Walch, who owns the used electric vehicle dealership Green Eyed Motors just outside Boulder, Colorado. A cottage industry of battery health diagnostic companies has sprung up to assess used cars. With permission from owners, Recurrent collects data from 6,000 EVs on the road. “Transparency here helps accelerate the market,” says cofounder and CEO Scott Case.

Stephanie King, who lives outside of Portland, Oregon, bought her second electric vehicle—and first used one—this month, after a crash totaled her old car. Her used 2019 Kia Niro was more expensive than the new one she bought two years ago, but there just wasn’t that much available, she says. For King, driving electric is non-negotiable, especially because she’s a full-time ride-hailing driver who puts a lot of miles on her car. “I couldn’t do that to my planet,” she says of gas-powered cars. She’s filing paperwork to take advantage of Oregon’s rebate program now.

Policy experts are divided on the value of EV incentives, especially for used cars. For reducing greenhouse gas emissions, “it’s not a well-targeted solution,” explains economist Dave Rapson, who teaches at the University of California at Davis. EVs are greener than conventional cars, but they still make use of a dirty electric grid, and money spent forcing their adoption might be better used getting utilities and big industries to clean up the energy supply. Tax credit programs for new EVs have proven expensive, with part of the benefit absorbed by automakers who may use it as an opportunity to raise prices. That sort of padding might have made more sense a decade ago, when carmakers were reluctant to build any electric vehicles at all, but are less so now, with a dramatic shift to all-electric lineups. (That’s one reason the initial federal tax credits phased out when an automaker sold 200,000 vehicles.) And insofar as those discounts do help lower the prices of electric vehicles, additional incentives for used cars result in “double dipping,” according to Rapson, because incentives for new EVs trickle down to resale prices.