Germany's Affection for Electric Vehicles Blossoming?
The used electric vehicle (EV) market is experiencing a significant surge in demand, with the number of available models increasing by about 50% in early 2025. This trend is driven by a combination of factors, including federal tax incentives, improved technology, and growing consumer interest in sustainability.
Used EV demand has outpaced traditional gas cars, with many vehicles coming from commercial leasing fleets and being sold through dealers. This has led to a diverse and attractive used market, featuring like-new EVs with low mileage.
Price appreciation trends in used EVs are another key factor driving the market's growth. Unlike many used vehicles, EVs have shown an 8.3% year-over-year increase in value, outpacing non-EVs. Used Teslas, in particular, retain value strongly, with average prices stabilizing around or below $25,000 after incentives, making them competitive with used gas cars.
Certified Pre-Owned (CPO) programs have also played a significant role in boosting buyer trust. These programs offer warranty-backed vehicles that mitigate concerns around battery health and reliability, and they highlight transparency about vehicle condition. They also include maintenance packages to address residual value and trust in the vehicle's lifecycle.
Dealers are increasingly educating buyers on EV specifics such as charging logistics, range capabilities, and total cost of ownership. This addresses common apprehensions about range anxiety and charging infrastructure. Apps and infrastructure improvements reduce these concerns by planning routes and fast-charging options, enhancing buyer confidence and transparency.
Federal used EV tax credits, currently offering up to $4,000, are driving demand, especially as the credit is set to expire on September 30, 2025. These credits boost residual values and make used EVs affordable, helping buyers overcome upfront cost barriers, improving perception of long-term value.
Dealers are also bundling EVs with maintenance and flexible financing solutions to alleviate worries about battery depreciation and higher loan interest rates on used vehicles. This approach strengthens buyer trust and supports better residual values by making ownership costs predictable.
However, the high cost of batteries remains a source of uncertainty for many used car buyers. The industry is addressing this issue with solutions such as established battery certificates and battery tests.
The path to widespread acceptance of electric mobility leads through the used car market. Affordable vehicles, charging prices, and less uncertainty and more transparency are crucial for the shift to electric mobility.
In Germany, electric mobility has surpassed internal combustion engines for the first time, according to the DAT Barometer. Social leasing, as discussed by the SPD, aims to give households with lower incomes access to electromobility. The leasing rate for electric cars in the private market is less than 25%, and for used cars, it's only 2%.
Promotional measures like the environmental bonus or purchase premiums can have unintended consequences, such as a drop in the residual values of used electric vehicles. The industry is addressing this issue with solutions such as established battery certificates and battery tests.
Two-thirds of respondents in the DAT barometer want cheaper and uniform prices for charging, instead of high purchase incentives for the car itself. Martin Endlein, from DAT, believes that affordable cars, rather than purchase incentives, are the key to boosting the electric car market. He emphasizes the importance of private customer interest in electric cars, as shown by the podcast with him and the DAT Barometer.
With the steady growth of the used electric vehicle (EV) market, consumers are now presented with an extensive selection of like-new EVs, driven partially by the surge in demand and the influx of commercial leasing fleet vehicles. Used EVs, such as Teslas, have demonstrated impressive price appreciation, with average prices hovering around $25,000 after incentives, making them competitive with traditional gas cars.
Dealers are making strides in bolstering buyer trust by offering Certified Pre-Owned (CPO) programs, which include warranty-backed vehicles, transparency about vehicle condition, and maintenance packages to address residual value and trust in the vehicle's lifecycle. Furthermore, dealers are addressing common apprehensions about range anxiety and charging infrastructure by providing educational resources on EV specifics, apps for planning routes and fast-charging options, and federal used EV tax credits up to $4,000, all contributing to the market's expansion.
