Government must act now on used EV values, BVRLA says

The UK Government needs to take immediate action to avoid further volatility in used EV values, according to the BVRLA.

The rental and leasing industry body said used EV values had fallen by 50% over the past 24 months, and could fall further if no action was taken.

The BVRLA said the issue was damaging confidence in the EV transition, and making new EVs more expensive, due to pressure being put on finance companies to increase rates for new EVs to cover potential losses on used models. 

It said there was already evidence that a used EV supply-demand imbalance was hampering interest in new EVs, citing a belief by Oxford Economics that the collapse in used EV values would result in nearly 300,000 fewer new EVs being sold by 2027.

BVRLA chief executive Gerry Keaney said: “Vehicles start depreciating as soon as they are sold, particularly over the first few years. This is a fact of life and the cost of this loss in value is absorbed into the vehicle finance agreements that are responsible for around 90% of all new car and van sales. 

“What is unprecedented and unsustainable is the scale of depreciation we are now seeing. Over the last two years, used EV values have dropped by 50% and are set to fall even further.

“These losses are being swallowed by the leasing companies and fleet operators that have championed the switch to zero-emission vehicles. They cannot continue to bear this burden alone. 

“The government needs to intervene now to help bring confidence and stability back to this vital part of the automotive ecosystem.”

The warning came as part of the BVRLA’s annual Parliamentary Reception, where it launched the Happy EV After campaign, in conjunction with Auto Trader, EVA Englan², and the NFDA. The campaign outlines where policy changes, targeted incentives, and collaboration between government and industry can create a smoother EV transition.