Addressing barriers to used EV market “could encourage 17m UK drivers to switch to electric”

The UK’s EV transition could be fast-tracked by more than a decade if steps are taken to improve consumer confidence in the second-hand EV market, according to the Green Finance Institute.

The GFI’s report Used EV Market: The Key to Unlocking Net Zero concludes that EV uptake in the UK could increase by as much as 17m if key barriers impacting consumer confidence are addressed.

The top concern is the EV’s battery health, the GFI found, but concerns around charging infrastructure followed close behind.

The GFI notes that the used car market is unaffected by the government’s 2030 ban on new petrol and diesel cars and actually accounted for as much as 82% of cars sold in the UK in 2021.

The report surveyed over 2,000 UK drivers and included contributions from 35 leading car dealerships, motor finance lenders, and lease companies. It found that, despite over 61% of drivers indicating they would purchase an EV, over a quarter of them would not buy a used EV unless a range of concerns were addressed.

Lauren Pamma, Programme Director at the Green Finance Institute, said:

Without the used market, the EV transition is destined to stall… If we are serious about driving EV adoption en masse, we need to channel this appetite for second-hand cars towards EVs. Our research makes clear that the demand for EVs is already there, but to unlock the used market, we need to boost consumer confidence on battery health, charging infrastructure, and affordability. In collaboration with the public and private sectors, the Green Finance Institute is already working to implement solutions that tackle these barriers.

The research also identified a clear disconnect between drivers’ perceptions of EV running costs and the reality. Of those who currently wouldn’t buy a used EV, 27% cited cost and the cost of maintenance as a major factor. However, research has shown that the overall running costs of an EV over its lifetime of ownership are typically less than that of petrol or diesel counterparts, the GFI noted. Recent falls in used EV values reported by AutoTrader also mean there are some used EVs which are cheaper to buy than the petrol equivalent, such as the Renault Zoe, the GFI added.

Despite the growing number of public charge points, which have increased by 523% in the last six years alone, the drivers surveyed also said a better understanding of the cost and locations of public charging would encourage them to make the switch to an EV.

The GFI said it is working closely with financial, policy, and automotive partners to develop and pilot a range of solutions to demonstrate their potential for boosting used EV uptake.

These include:

  • Battery Health Certificates (a standardised battery health certification scheme for used vehicles) and Battery Value Guarantees (a mechanism for EV batteries to have a guaranteed end-of-life value)
  • Battery Passports, which give second-hand buyers accurate knowledge of their prospective battery’s life to-date
  • Agreed definitions and standardisation of metrics for Total Cost of Ownership Calculators to help paint a clear picture of the total lifetime costs of EVs, including fuels and maintenance.
  • Addressing information gaps, particularly surrounding topics such as the cost and location of public charge points, as well as energy tariffs to keep at-home charging costs low
  • Reduction on the rate of VAT on public charging (20%), to match that of home charging (5%), coupled with combined monthly finance packages inclusive of both vehicle and home charging