Used electric vehicle prices soar thanks to fuel prices and supply shortage

The used car market has gone wild over the past two years, thanks to crippling supply shortages for new vehicle manufacturers which have resulted in long delivery delays.

However, this factor combined with the recent skyrocket in fuel prices to an average of $2.12 per litre for regular unleaded, has resulted in a surge of demand for electric vehicles – especially pre-owned models.

Australian auction house Lloyds has reported a significant spike in interest for used electric vehicles, with many cars going over the block selling for more than they were new due to the considerable demand.

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According to Lloyds Chief Operations Officer Lee Hames, Australia's most popular electric vehicle, the Tesla Model 3, has commanded the largest price jump of all, with bidding for one current-spec model sitting higher than its drive-away price from the manufacturer.

“Right now, we have a 2022 Tesla Model 3 on offer with the current bid sitting at $71,000 where they actually retail for around $68,000 and the bidding is set to close in a few days time,” said Hames.

"With the current fuel prices, people are realising how much they can save in fuel per year by owning an electric vehicle, where savings could be up to 70 per cent on fuel alone.

"The electric car market is still very new to Australia, which is actually a massive benefit to purchasing electric vehicles second-hand, as they are in such great condition usually only having been used for a few years, with previous owners now upgrading to the newer model electric vehicles."

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The Electric Vehicle Council has long campaigned for more EV support in Australia, calling out the Federal Government for its lack of a strategy to encourage the uptake of the vehicles locally.

CEO Behyad Jafari believes Lloyds Auctions' experience of increasing demand for electric vehicles shows the Federal Government's stance on EVs has led to the Australian public fighting over a small pool of available vehicles.

"This is a stunning reflection of how the Australian Government has allowed demand to totally outstrip supply on EVs, leaving Australian consumers with the choice between a massive wait or paying above-retail for a used car," said Jafari.

"The Morrison Government seems to have confused its own myopic views about EVs with those of average Australians and has completely misjudged how demand would grow.

"Australians have seen right through the nonsense that was peddled by the Government about EVs at the last election, and they're now queuing up to buy one. But the shelves are empty because the Federal Government has made Australia such a uniquely hostile market to EVs.

"Global carmakers are far more interested in selling cars in Europe or the US or even New Zealand, where fuel efficiency standards are established and governments offer unambiguous support to the transition.

"Every Australian who wants to buy an EV should have the same array of options as their counterparts in America or Europe. The fact that they do not is the fault of the Federal Government."

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Jafari also warned a lack of fuel efficiency standards in Australia will lead to lesser models being available locally, with the country's states and territories currently leading the charge away towards cleaner vehicles.

"Because the Morrison Government's refuses to introduce the same fuel efficiency standards they have in the US and the UK Australians are being denied access to the electric cars they now desperately want — especially at the more affordable end of the market," said Jafari.

"Carmakers look at Australia and see strong demand, which is encouraging. But they also realise that every time they sell an EV in America or Europe that will count toward meeting the fuel efficiency standards of those jurisdictions. So naturally they prefer to sell EVs there, instead of here.

"Through a toxic combination of inertia, myopia, and dogma the Morrison Government has created a situation where thousands of Australians can't get access to the car they want to buy.

"All over the world governments are recognising that most consumers want an electric option when they consider their next vehicle and they're doing what they can to make that option viable. Australia remains a real outlier.

"It has been encouraging lately to see several state and territory governments introduce positive demand policies to incentivise the purchase of electric vehicles for consumers. But until the federal government comes to party consumer choice will continue to be throttled.

"If Australia continues to be one of the only developed nations without fuel efficiency standards then we will continue to be a dumping ground for the world's dirtiest vehicles."

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However, don't go rushing off to buy an electric vehicle just to save at the bowser just yet.

While fuel is over $2 per litre for the first time in Australia's history, the cheapest electric vehicle on the market is MG's ZS EV Essence, available at a drive-away price of $44,990 before incentives.

Compared to its internal combustion engine-powered counterpart, the MS ZS Essence, the fully-electric model commands a premium of $19,000 – with the 1.0-litre, turbocharged petrol model on sale from $25,990 drive-away.

Despite there being no Federal-led approach to EVs, every Australian state and territory currently offers a variety of incentives for buyers who want to move away from fossil fuels.