Why should you care about the used EV market? If you are reading this, it is safe to assume that you actively support the adoption of electric vehicles. Whether an owner or advocate, you want to reduce tailpipe emissions and reliance on fossil fuels. But a large portion of the driver population cannot afford the switch to an EV yet. Every early adopter can do something today to change that by helping to establish a used EV market so everyone has the option to drive an electric car tomorrow.
The key to unlocking this secondary market is confidence in the batteries of used cars. That is more difficult than it sounds because lithium ion batteries are literally and figuratively opaque. By understanding battery aging across vehicle makes and models, we can help build a transparent and accessible used EV market for everyone.
Recurrent has taken on that mission by using machine learning models to understand range degradation indicators and trends. The more data that goes in, the higher the confidence level that comes out. Contributing to this program is easy: every EV owner who signs up for free battery reports today makes it easier for the next generation of EV owners to find a good, dependable electric car tomorrow. It is only in the US for now, but expanding to other markets.
The chart below shows some of our original, crowd-sourced range data for over 2,600 Tesla Model 3s in the existing research community.
Why the Used EV Market is So Important for Adoption
There are many ways to support the transition to electric vehicles – charging infrastructure, battery development, clean energy legislation – but building a healthy used market is often overlooked. Recurrent wants to build confidence, transparency and trust in second-hand EVs, filling an important need on the long road to electrification and decarbonization.
In the US, the ratio of new to used cars is less than 1:2, meaning that there are more than twice as many used cars on the road for every new one. Used EVs are essential to hit climate goals. Moreover, the used market is more resilient to market turbulence and is expected to grow faster than the new car market.
Finally, buying used is greener. This applies to anything, but especially to EVs, which have unfortunately high carbon emissions in their production phase. Once an EV is made, regardless of how local electricity is generated, it will have lower emissions than conventional cars. It has been proven time and time again, the longer an electric vehicle is on the road, the more carbon savings.
What all this means is that a lot of currently-owned EVs will need to be sold to second owners, either through private sales or dealerships. Most electric vehicles are disproportionately leased at a rate of 80%, compared to 27% of ICE cars. On the other hand, Tesla, which makes up almost 54% of US EV sales, was late to develop a lease option and it is estimated that only 7% of 2021 Q3 Teslas were leased. Returned lease vehicles almost always wind up being resold by dealerships, whereas cars that are purchased outright can wind up on national reselling sites or being sold privately.
Used EV Shopping is Hard
As if shopping for a traditional used car wasn’t hard enough, shopping for a used EV creates a whole new set of issues. No longer able to rely on familiar heuristics such as odometer, number of owners, or maintenance records, shoppers want transparency about what the range of a used electric car will be in a month, a year, and three years. The odometer doesn’t give you enough information, since battery care, location, and use can play larger roles in the overall health of an EV.
Similarly, there may be very few maintenance records for a recent-year EV – other than rotating the tires and changing some air filters, electric cars require very little regular work. Recurrent’s research shows that range degradation is actually the number one factor that potential buyers care about, even more than car price or condition.
The question remains: how do you show prospective buyers what to expect from a used EV?
Recurrent Battery Reports
Recurrent works to support the used EV market by producing reports on individual used cars so shoppers have more information to guide their decisions. We crowdsource telematics data from a nationwide group of EV drivers to build predictive models for range degradation. Subscribers automatically send data three times a day and receive a report about their vehicle at the beginning of each month. For those who are ineligible for monthly subscriptions, a photo verified report is available.
Recurrent reports offer a solution to shopper anxiety and pave the way to a thriving used EV market. These reports serve as a record of good battery hygiene, predicted range, and market value. Shoppers can run a manual report on an EV in a dealership lot to check the battery and compare vehicles. Recurrent also promotes knowledge and research about going electric to help potential shoppers make the best decision:
- Can I have an EV if I live in an apartment?
- What’s the deal with all the different types of chargers?
- What causes my EV battery to degrade?
We all want a cleaner, greener future, and know that EVs are a step in the right direction. Thanks for everything you’re doing to support this movement and thanks for your help in developing the used EV market.
This article is supported by Recurrent Auto.
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