Behind China's EV boom: No one wants to buy a used one
Sales of new energy vehicles in China reached 226,000 units in March, up 2.4 times year-on-year, but no one wants such models in the used car market, state-run media CCTV reported Wednesday.
In the largest used car market in Hangzhou, Zhejiang province, new energy used cars are prominently displayed, with eye-catching signs on them. Even so, few people have asked for them, and their bodies have been covered in dust, the CCTV investigation found.
A businessman who has been in the used car business for 13 years said he saw good sales of new energy vehicles two years ago, so he opened up a related business, but the new energy used cars he received gave him a headache.
The purchase of a Tesla will lose more than RMB 100,000 because the price of new cars has been falling and used cars can't be sold for two or three months, he said.
In a used car supermarket in Shanghai, new energy used cars look newer but sell for half the price of a new car.
The supermarket manager said that because of the low demand, the price of new energy used cars will become 50% to 40% off in the first year, and 20% lower than the price of fuel cars in the second year.
An Hangzhou-based used car trading platform manager said an RMB 100,000 car would cost just 20,000 to 30,000 after two years.
China has 5.51 million new energy vehicles in the first quarter, more than half of which are less than two years old, and most of those entering the used car market are three-year-old new energy vehicles.
One Shanghai consumer said the price of used cars is too low to buy, and many of the subsidies for new energy vehicles are only for first-time owners.
Less than 2 percent of used cars traded in China are new energy vehicles, and the value retention rate is 20 percent lower compared to fuel cars of the same age.
Three years ago, the range of new energy vehicles was around 200 km, but now most new energy vehicles have a range of more than 400 km, and the price of new vehicles is much lower than three years ago.
New energy vehicle owners are reluctant to sell due to the lower used selling prices, so fewer new models on sale are flowing into the used market.
In the first quarter of China, new energy used vehicles accounted for 43% of used vehicles less than three years old, while fuel vehicles accounted for only 10%.
More than 1 million new energy vehicles were sold in China in 2018, and 430,000 new energy vehicles will enter the used car market by the end of this year, the report said.
Shen Jinhui, president of the China Automobile Dealers Association, said that as the ownership and quality of electric vehicles continues to increase, the flow of used vehicles will be very smooth and could drive sales of new vehicles.