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Discounts for electric cars increase, average price falls below Tesla

Discounts for electric cars increase, average price falls below Tesla
Discounts for electric cars increase, average price falls below Tesla

  • For the first time in nearly 18 months, a new electric vehicle cost less on average than the average Tesla vehicle.
  • Dealers are reducing prices for used electric vehicles and offering incentives for new
  • The average discount on an electric vehicle in May was 12.4% of the average transaction price, almost six points below the industry average.

Average prices for electric vehicles have fallen over the past two months, with the rest of the industry catching up with Tesla’s price cuts, reports Cox Automotive (via Automotive News).

The average EV transaction price across all brands (including Tesla) was $55,235 in April, $433 less than Tesla’s average. This is the first time since February 2023 that the industry average has fallen below Tesla’s, Automotive News notes. In May, the industry average for EV transaction prices was 721 USD less than the Tesla averageat $56,648.

2024 Tesla Model Y. – Courtesy of Tesla, Inc.

2024 Tesla Model Y. – Courtesy of Tesla, Inc.

Tesla has cut its prices several times in the past year, but now other car manufacturers seem to be following suit. average EV discount was 12.4 percent of the average transaction price in May, almost six points above the industry average, according to Cox.

Electric vehicle prices have been volatile over the past six months, Cox noted. From December to February, they were around $57,000, fell to $53,000 in March, but rose again in May to almost the same level as in December. However, the gap with Tesla disappeared completely during that time. In December, the average total price of an electric vehicle was $7,276 higher than Tesla’s average, according to Cox.

Hyundai Ioniq5 (2024)

Hyundai Ioniq5 (2024)

Discounts can be a confirmation of reality. Concerns about the cost of new electric vehicles are the reason for the decline in consumer willingness to buy, according to a study by JD Power published in May. A lack of affordable electric vehicle models and shrinking availability of the $7,500 federal EV tax credit New rules that came into force at the beginning of the year have not exactly improved things.

Cox also noted a 84% increase in sales of used electric vehicles in May. This is being helped by a shrinking price gap in used gasoline cars, which narrowed to $1,100 during the week of May 6. Earlier this month, iSeeCars reported that used electric vehicle prices were actually below those of internal combustion engine vehicles, based on a survey of used car asking prices. Lower used electric vehicle prices could also push automakers to discount their new electric models.

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