Continuing EV sector volatility brings challenges for the used car market in 2024

Cox Automotive anticipates challenges and continued volatility in 2024 for the used EV market despite rapid growth in used vehicle volumes, due to persistently low consumer demand.

Several continuing trends, including the realignment of vehicle values, supply shortages, economic uncertainty, and continuing EV market volatility, are likely to underpin those complexities.

Vigilance in the face of used market complexities will be key to success for industry players in 2024, according to Cox Automotive.

Cox Automotive Europe’s Insight Director Philip Nothard (pictured) said: “Volumes of used EVs are growing fast, but consumer demand remains damagingly low.

“The used market for them is yet to find its feet – all of which is fuelling the instability of values.

“These negatives will surely be diluted as the sector continues to evolve, as prices lower, range and technology improves, and pricing becomes more attractive thanks to competition from new entrants.”

Writing in its latest Insight Report, multiple industry commentators point to a needed evolution by dealers and manufacturers to weatherproof their businesses in the year ahead.

Nothard commented, “The used market remains in a delicate transition, as we have seen over the past few years. Inconsistency persists in many areas, including where vehicle values and production shortages are concerned. The latter continues to have a marked impact on the number of vehicles entering the used arena.”

ICDP Managing Director Steve Young gives a stark warning in the Insight Report about the used market road ahead, predicting that things are set to become “bloody” when it comes to vehicles from zero-to-four years old. He insists:

“The used market is becoming increasingly competitive; dealers need to differentiate by offering a superior customer experience.”

Philip Nothard concluded: “Ongoing value realignment is creating a market division between retailers and vendors. Dealers will strategically manage a mix of old and newly priced stock. At the same time, the fleet and leasing sector continues its vehicle de-fleeting process with residual values set before the pandemic bounce.”