The government’s move to stretch the electrification deadline to 2035 for new car sales will cause long-term volatility in the prices of electric cars, many dealers fear.
Nearly half of dealers (46%) think the values and prices of electric vehicles (EVs) will fall, as consumers take more time to make the switch.
And 44% believe a corresponding rise in petrol and diesel prices and values will occur as customers stick with petrol and diesel power for longer, while availability of these cars declines.
Paul Burgess, CEO at Startline Motor Finance, said: “Prices and values of EVs have been volatile over the last year or so, and a lot of dealers are already quite wary about the future prospects of the used EV sector, at least in the short-medium term. Our research shows that the government’s 2035 decision certainly hasn’t helped this situation.
“Dealers now think there will be further falls for EVs as consumers choose to take longer to electrify and that this will also bump up petrol and diesel values and prices. They believe that Rishi Sunak’s decision will have a very direct effect on the market and the fuel choices made by consumers over the next few years.”
Additionally, more than a third (36%) of those surveyed for the Startline Used Car Tracker say fewer dealers will choose to stock EVs, again affecting values and prices, while 10% believe ongoing uncertainty EV over values and prices will make stocking them a bigger risk.
Paul added: “It’ll be interesting to see how the reading of the market shown in our research plays out. What we are going to see in the next few years is a relatively fast change of new car supply to EVs which will, of course, soon feed through into the used sector. This fact will be largely unaffected by the 2035 decision and means that forecourts will rapidly electrify, whatever the government does, and whatever consumer and car retailer preferences.
“Some dealers and used car buyers may believe that there are now five more years for electrification, but supply into the market will largely dictate whether this is true.”
The Startline Used Car Tracker is compiled monthly for Startline Motor Finance by APD Global Research, well-known in the motor industry for their business intelligence reporting and customer experience programs. This time, 303 consumers and 59 dealers were questioned.