Used EVs Stabilize at $25,000 Due to Expired Tax Credit

TL/DR –

Electric cars have been around for over a century, but only became mainstream in the 2010s. The Inflation Reduction Act of 2022 and tax credits helped to fast-track EV adoption. However, changes to these incentives have not significantly impacted the affordability of EVs, with nearly half of used EVs still selling for under $25,000. Despite this, new EV sales declined by 28% in Q1 2026, while used EV sales increased by 27.7% in March 2026 year-over-year.

Facing the Electric Future: A Closer Look at the Used EV Market

The invention of the electric vehicle traces back to more than a century ago, with the birth of the one-horsepower 1888 Flocken Elektrowagen, which came into existence shortly after the creation of the first ever car, the 1885 Benz Patent-Motorwagen. Despite this early inception, it took until the 2010s for electric cars to become a potential market leader, due to technological and infrastructural limitations.

One of the driving forces behind the increased adoption of electric vehicles (EVs) was the Inflation Reduction Act of 2022, which offered significant tax credits on the purchase of electric cars – sometimes up to $7,500 off the sticker price. However, these credits disappeared with the introduction of the Big Beautiful Bill of 2025. Still, the market hasn’t plummeted as feared. Nearly half of all used EVs continue to be sold for under $25,000, the price limit for used electric cars to claim a $4,000 incentive.

Market Trends: Nearly Half of Used Electric Cars Sold for Under $25,000

Even before the removal of the tax credits, used car sellers were pricing their EVs under $25,000 to take advantage of the demand created by the earlier tax incentive policies. It was not uncommon for a used EV that was eligible for the tax credits to sell for $21,000 despite being listed for $25,000. Remarkably, even a year after
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