The AFP’s report reads: “What has been achieved over the last few years in the electrification of company cars has been nothing short of spectacular.
“However, there are issues still to resolve and probably the biggest is the used EV sector.
“Although the situation has improved a little recently, the market plummeted during 2023, creating an ongoing impact on residual values (RVs) and whole life costs (WLCs).
“Arguably government support of some kind is needed to redress this situation, encouraging second and third buyers to look at EVs – both cars and vans – more favourably, at least until the market reaches a point of greater maturity.
“Part of the immediate problem is that many of the first wave of EVs adopted by fleets were luxury car models, and do not have appeal as everyday family transport for used buyers. More attention needs to be paid to the EVs that are being bought as company cars.”
Dealers have previously warned they are “losing thousands on used electric cars due to the rate of depreciation on forecourts.
Furthermore, a recent poll from second-hand traders HonkHonk has even revealed some dealerships were reluctant to stock electric models.
More than one in three dealers (38.5 percent) claimed they were “much less interested” in securing EV models than just a year ago.
The AFP has also called for a new second-hand electric car assessment to offer “reassurance” to concerned motorists on the fence about making the switch.
The report explained: “Another key concern in the used sector is the need for a standardised battery health check to give the used buyer a high degree of reassurance, largely to offset reports of horror stories of cars requiring replacement batteries at costs that exceed the vehicle value.
“Work on this is currently underway at an international level and it can’t come soon enough but also, we just generally need to see more emphasis placed on educating used car buyers.”
