Why do electric cars depreciate faster than ICE vehicles?

Anyone looking at the used car market may ask; why do electric cars depreciate so much compared to petrol vehicles?

There are several reasons why that’s the case, but in a dynamic and evolving market, that may soon be about to change.

Electric vehicles (EVs) are set to transform the UK’s roads over the next 10 years.

In January 2025, the Government announced a consultation on phasing out the sale of new petrol and diesel cars from 2030, with an aspiration that all new cars and vans will need to be 100 per cent zero emission by 2035.

With that in mind, why do electric cars depreciate so much and what does the future hold for EVs in the UK?

The rapid pace of advances in EV technology

Vehicle manufacturers are investing heavily in EV research and development, resulting in newer models with longer mileage ranges, faster charging times, and improved battery efficiency.

However, constant development means that current EVs can quickly become outdated when compared to the latest models.

This ultimately means faster depreciation, with new versions making older ones less desirable.

These fast-paced advancements in EV technology are one explanation to why do electric cars depreciate so much when compared to internal combustion engine (ICE) vehicles.

Battery replacement costs

EV batteries are designed to last for many years, but they do degrade over time.

This reduces the battery’s range, and will ultimately require replacement.

The cost of replacing a battery can be substantial, which can be off-putting for potential buyers who would rather pay more for a new vehicle with a battery that’s unlikely to need replacing for many years.

Manufacturers are working hard to improve battery technology, and warranties give some protection, but depreciation remains a key consideration.

Incentives

Government grants and incentives for EV purchases reduce the upfront cost of new cars and in turn negatively impact resale values. 

This subsidised price makes price expectations lower for secondhand models.

Also, as more EVs enter the used car market, the supply can outweigh demand.

Consumer hesitation

Many drivers are still unfamiliar with EVs and have justifiable concerns about charging infrastructure, particularly outside of cities and larger towns.

Range anxiety and worries about battery life are impacting demand in the secondhand market. Buyers are often more familiar with ICE vehicles, which they understand and believe to be more reliable.

A significant proportion of EVs are also leased rather than being bought outright, meaning they may return to the market after a few years.

This influx of formerly-leased EV vehicles can lead to oversupply, reducing their resale values.

Supporting the EV transition

The future of UK transport is undoubtedly electric.

At Autotech UK, we’re supporting this transition by supplying cutting-edge mileage blockers specifically designed for legal use with electric vehicles.

Mileage blockers are essential in controlled testing environments, such as automotive development, vehicle tuning, and diagnostic testing scenarios.

While EV price depreciation is currently steeper than ICE vehicles, the trend is expected to stabilise as technology develops.

Improved battery lifespans and growing consumer confidence, as well as the rollout of charging infrastructure, is making the EV market more stable and predictable. Over time, EV vehicles are expected to retain their value for longer.

All of these factors lead to more rapid depreciation of EV vehicles, but this situation is complex and evolving quickly.

As more EV vehicles come onto the roads, the secondhand market is expected to stabilise and become more predictable.

Electric vehicle mileage blockers from Autotech

Autotech UK’s premier selection of mileage blockers provides the ultimate solution for optimising your chosen vehicle’s performance.

Compatible with more than 250 models, including high-end EV brands such as Mercedes, Audi, and BMW, our meticulously engineered products guarantee performance, reliability, and longevity.

Backed by a 28-day money back guarantee, and a comprehensive two-year hardware warranty, our range of CAN bus mileage blockers are the leading choice for vehicle enthusiasts looking for an effective, reliable, and durable product.

If you have any questions, our team is always happy to help.

We can be contacted via Facebook Chat, Skype, or WhatsApp.

You can also call by dialling 0330 043 173 or send an email to contact@mileage-blocker.co.uk