Inflation, persistently high interest rates, and now surging gas prices have made buying and owning a car expensive.
New cars hover around the $50,000 price range, making them unaffordable to most Americans, but the used-car market has usually stepped in and taken some of that load.
The used-car market is nearly twice the size of the new car market, with used car sales in the US ranging between 32 million and 40 million sales each year — and those prices are rising as demand increases.
But there’s one segment of the car market that’s poised to fill in the affordability gap — used EVs.
And a boatload of new supply may soon help consumers.
That’s because a lot of cars purchased during the $7,500 Biden-era federal EV tax credit are coming off standard three-year leases.
Data site Recurrent expects up to 500,000 EVs to come off lease in 2026, with nearly double that possible in 2027.
“This may open the door to a new market that can reach millions of Americans who are looking for an affordable option for their next vehicle,” wrote Corey Cantor, research director at EV advocacy firm ZETA.
Auto purchase and review site Edmunds.com also reports more electrified vehicles are entering the used market due to lease returns.
While internal combustion vehicles made up 93% of expected lease returns in 2025, that share is projected to fall to 82% in 2026; meanwhile, the share of battery electric vehicles is projected to rise from 2% of lease returns in 2025 to 8% in 2026, according to Edmunds.
Couple that with the fact that most lease buyouts for EVs are not economically attractive, and more lessees choose to return their vehicles at the end of the lease rather than purchase them, potentially adding more supply to the used EV market.
Chevrolet Bolt EUV is displayed during the 2026 Chicago Auto Show at McCormick Place on February 06, 2026, in Chicago, Illinois. (Jacek Boczarski/Anadolu via Getty Images) · Anadolu via Getty Images
“As more of these vehicles enter the used market, shoppers looking to reduce fuel costs may find more affordable electrified options than buying new. Because many of these vehicles are only a few years old, buyers may also benefit from improved range and technology compared with earlier EV models,” Edmunds analyst Jessica Caldwell wrote.
And used EVs appear to be a bargain.
Car shopping site Cargurus.com noted in its February market report that used EV prices have fallen 35% since 2022 to an average of $34,600, creating an opportunity for shoppers looking for a good deal on an EV.
Cox Automotive reported that in February, overall used EV sales in America totaled 30,879 units, up a whopping 28.8% year over year and 4.2% month over month, suggesting Americans were getting in on the trend even before the surge in gas prices.
Tesla (TSLA) led used EV sales last month, with more than 12,133 retail units sold at non-Tesla dealerships, followed by Chevrolet (GM), Ford (F), BMW (BMW.DE), and Hyundai (005380.KS), Cox said.
In fact, used Tesla EVs are selling about twice as fast as the rest of the market.
The Tesla Model X and Cybertruck feature prominently in iSeeCars’ fastest-selling used car list. · iSeeCars.com
While the average used car takes 53 days to sell, the Tesla Model X and Cybertruck sell in less than 28 days, per data from iSeeCars.
Meanwhile, in the new-car market, the frugally priced Chevrolet Bolt EV was the top-selling auto, with only 9.6 days on the market.
Add it all up and maybe Americans won’t be so sour on EVs — if the price is right.
Pras Subramanian is Lead Auto Reporter for Yahoo Finance. You can follow him on X and on Instagram.
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