Electric and hybrid cars often languish on dealer lots because they are too pricey for many new-car shoppers to consider. But on the used-car market, these “green” rides are among the most sought-after and fastest-selling vehicles. Some models are also more affordable than ever.
In many cases, cars that shoppers found prohibitively expensive when new — like the battery-powered Nissan Leaf and Toyota Prius Plug-In hybrid — are priced more like traditional cars on the used market, according to a study by research company iSeeCars.com.
The trend could be a boon for drivers who have always wanted alternative-fuel vehicles but could not justify spending thousands of dollars extra.
Compared with last year, the prices of certain used electric cars and hybrids have fallen farther than those of traditional gasoline-powered cars, according to the study. The price decreases are the result, in part, of lower gasoline prices that tend to hurt sales of cars designed to save fuel.
More Your Money videos
Now that Amazon is acquiring Whole Foods, what will it take over next?
‘Pharma bro’ Martin Shkreli goes on trial for securities fraud
Google hit with record $2.7 billion fine by European Union
Health care bill would cause 22 million to lose insurance, CBO says
However, electrics and hybrids still have a strong following. And thanks to the large used-car discount they are also spending far less time on dealer lots than most “regular” cars — a dramatic swing from when they were new.
Researchers at iSeeCars.com analyzed more than 2.2 million 1- to 3-year-old used cars sold from January through May this year. They found that half of the top-10 fastest-selling used cars in the U.S. are electrics, hybrids or plug-in hybrids. The Toyota Prius Plug-In topped the list, selling in an average of 19.7 days after arriving in dealer showrooms, compared with an average of 42.4 days for all 1- to 3-year-old used cars.
During the same period last year the Prius Plug-in stayed on the market almost twice as long before it was sold — an average of 38.1 days. In a statement, iSeeCars CEO Phong Ly said the Prius Plug-In is, to some degree, a unique case because 54 percent of these cars were sold in California, where a program to issue stickers that allow plug-in hybrids to drive in California's carpool lanes with a single occupant has reached its limit. This has spurred demand for used cars that already have the stickers, Li said. But a 17 percent price drop since last year also drove demand for the car. The Prius Plug-In sold for an average of $22,945 in 2015 but prices fell to $19,057 this year.
A quick survey of online pricing data from Cars.com, Edmunds.com, KelleyBlueBook.com and the National Automobile Dealers Association found that a 2014 used Prius Plug-In costs about $20,000, or 38 percent less than it cost when new. The price of a conventional gas-powered Toyota Camry XLE has fallen about 30 percent (from $25,810 to $17,975) and the Honda Accord EX-L has fallen 25 percent in the same period.
When new, the electric and hybrid models cost much more than similarly equipped conventional gasoline-powered cars. But they often cost only slightly more on the used-car market, making them worth a second look. After several years on the market, cars that run on batteries have proven to be generally reliable and inexpensive to maintain, and thus more desirable and less anxiety-provoking than when they were introduced.
If you're thinking about buying an electric or hybrid vehicle, consider the following:
1. Know where to shop.
Car-shopping sites like AutoTrader, Edmunds, Cars.com and others will direct you to dealers that have these vehicles in stock. You can also check the used-car sections of brand-specific dealerships near you (for example, Toyota dealerships for the Prius).
2. You don't have to live in California to plug in.
While California is an electric-car hub, charging stations are cropping up across the country. Use online guides like PlugShare, ChargePoint and the Alternative Fuels Data Center to locate stations in your area.
3. Car batteries aren't like smartphone batteries.
So far, the batteries in electric and hybrid cars have proved reliable and long-lasting. They will lose some off their capacity over time, but the losses are minimal according to several studies. Car makers say the lithium batteries in the cars last longer than in phones and laptops in part because they have more sophisticated monitoring and control systems that keep them from wearing down prematurely.
4. Despite low fuel prices, there are still compelling reasons to buy.
The lowest seasonal gas prices since 2005 are certainly fueling road trips, but running on electricity is still cheaper than buying gasoline — and you also save time not waiting at the pump.