The Business Of…
The used EV marketplace
There are great opportunities for dealerships to secure high quality stock and provide used car buyers with affordable pre-owned electric vehicles that are well suited to their daily needs.
With a trajectory being set by the UK Government electric vehicles will only become a larger proportion of the country’s car parc. This means that dealerships which aren’t retailing EVs now will face a steep learning curve.
It is now almost a decade since the nation’s politicians began discussing a phase-out of internal combustion engines from the new car and van markets, as part of their long-term clean air goals.
Ministers then gave the industry a definitive sign of the direction in 2020 by announcing that ICE new cars would be banned from 2035, and followed this up in 2023 with the finalisation of the Zero Emissions Vehicle Mandate. This mandate has set rising annual targets for the proportion of each year’s new car and light commercial vehicle markets that must have zero tailpipe emissions – essentially, endorsing the electric vehicle.
This led to almost one in every five new cars registered in 2024 to be a battery electric vehicle, and almost one in every four in 2025.
In fact there are now around 1.9 million electric cars on UK roads, two thirds of which are less than five years old. As these cars come to the end of their financing and return into the market these represent a superb opportunity for motor retailers. Early adopters and company car drivers have already shown that electric vehicles involve fewer of the lifestyle compromises that many drivers once expected, and now more mainstream private buyers are seeing well-prepared, warrantied pre-owned EVs as very good value.
In its 2025 full-year data, Autotrader found that EVs were accounting for 15% of all stock advertised, and 80% of franchised dealers and 20% of independent used car dealers were stocking at least once electric car. The car marketplace noted that demand for used EVs up to six years old has been growing strongly, with total enquiries up 27% year-on-year.
In addition, three-to-five year-old EVs were also the fastest-selling vehicles of any fuel type, which suggests that consumer demand is more than meeting supply, particularly once these cars’ depreciation curve has lessened. As soon as the ability to purchase a modern hatchback or SUV with low electric running costs had opened up to consumers with budgets as low as £10,000 to £12,000, more and more of these buyers are emerging. EVs within this age bracket were selling on average in 25 days, according to Autotrader, which was five days faster than the total market average in 2025 of 29 days for three-to-five year old cars.
Examining the zero-to-three year-old used car segment, it has faced more pressure. This comes from very competitive offers as OEMs strive to meet the government’s rising target in the new car market, plus from the arrival of smaller, cheaper EVs. This makes the zero-to-three year-old used car segment a more volatile place, as was seen in 2023 when EV prices dropped sharply, however today the broader variety of electric cars coming back into the used car market should dampen any risk of significant volatility. Nevertheless, here dealerships must be particularly alert, buying desirable stock at the right price point and ensuring their effective marketing and robust sales processes keep this young used stock turning quickly and profitably.
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The used EV marketplace
Stock selection
With the majority of new EV sales taking place in the fleet and leasing channels, it will be the professional auction and remarketing platforms that brings these cars within reach of dealers once they reach the end of their initial ownership/usership period.
Dealerships geared up for used EVs have the opportunity to win more customers, but the focus needs to be on understanding their local or regional market. If the stock they are buying in does not match what motorists want they will have to work harder to make their used EVs desirable, which will inevitably erode profit margins.
Demand-led sourcing is an essential practice when retailing EVs. Knowing which body types, equipment levels, marques and price brackets work best for the local customer base is a fundamental for any dealership.
When it comes to securing one-owner used EVs for stock unfortunately the dealers’ traditional and best source, the part-exchange, is rare in comparison to with petrol cars. The dominance of the fleet and leasing sector in new EV purchases, together with growth in salary-sacrifice schemes to tempt employees outside of company car programmes, has meant that the franchised dealer’s PCP renewal cohort is reducing.
Motability is always a good source, but generally most end-of-lease electric cars are reaching the auction and remarketing sector, including closed and open auctions, where dealers are having to compete for the more desirable stock.
Typically, only once an EV is at the end of its second or even third ownership period is it coming to dealers as a trade-in.
Although the use of remarketing platforms comes at a cost, due to the fees involved, the advantages they offer are numerous, given that ex-lease and ex-rental EVs will often have predictable mileage, good maintenance records and offer dealers a breadth of choice in mainstream colours and trim levels. If one falls outside your stock profile, chances are there will soon be another coming under the hammer.
Another benefit of ex-lease EVs from auctions is that these will generally still have manufacturer warranty covering the battery and electric drivetrain. To help build public confidence in EVs many carmakers provide battery warranties for as long as eight years or 100,000 miles.
Here, though, the car’s service history is probably more critical than it has ever been. Knowing that an EV has had its scheduled maintenance to the manufacturer standard will help to avoid any likelihood of the OEM finding a way to reject a claim should the customer who eventually drives the car off the forecourt later experience a battery failure or significant degradation of energy capacity.
Dealerships considering stocking older EVs need to do so while being conscious that many electric cars available before 2020 had limited range from new in comparison to recent EVs. These may seem less appealing to the majority of customers. In 2018 the average maximum stated range of a new EV was around 180 miles, and in 2015 it was around just 130 miles.
Nevertheless, with the right third-party warranties and battery checks in place there is a market for these modest-range EVs at the right price, particularly for second cars of a household that are used mostly for suburban commutes. After all, YouGov data from 2025 shows that among all everyday drivers, two in five (41%) typically travel 10-20 miles per day, one in five does less than 10 miles, and another one in five daily drivers cover 20-40 miles. So even a well-used mid-2010s electric car is still likely to be adequate for a good proportion of motorists, even after accounting for some battery degradation.
On the topic of battery degradation, for most used EVs this is slow and steady. Generational, a specialist in electric vehicle battery condition diagnostics, has tested more than 8,000 electric cars and light commercial vehicles (LCVs) in the UK. It found that the median battery state of health (SoH) for 4-5-year-old EVs was 93.5% of new battery capacity, and for 6-8 year-old EVs it was 90%. Even 8-9 year-old vehicles retain a median 85% battery capacity.
Its index also demonstrated that a vehicle’s mileage alone is an unreliable indicator of battery condition. Oliver Phillpott, chief executive of Generational, said: “The Generational Battery Performance Index definitively shows that EV batteries are performing far better than many consumers and industry stakeholders have been led to believe.
“With an average state of health of over 95%, and even older vehicles comfortably exceeding warranty thresholds, the underlying fundamentals are extremely strong.”
Some dealers clearly already are confident - cars such as the Nissan Leaf, Renault Zoe and BMW i3 have been in the market more than a decade and are being stocked and sold by used car dealers well past the end of their manufacturer warranty.
As the parc of battery-powered cars continues to grow, more dealerships will need confidence that the stock they're purchasing will give them profit and will not be creating problems for them and their customers.
Preparation and Marketing
Do the basics well and then go the extra mile to give potential car buyers the confidence to choose
As with all used cars, it is the preparation and the marketing that helps shift the stock speedily and profitably.
In terms of making used EVs forecourt-ready, dealers will typically apply their standard level of inspection and preparation. Naturally, any work required involving its high energy electrical systems will need to be done by a suitably technician trained to Level 3 Electric/Hybrid Vehicles Routine Maintenance Activities or higher.
The investment in such required technical competencies is likely to drive used car retailers to commit to selling pre-owned EVs in some volume, to ensure a return on that investment.
Although EVs that are out of the OEM warranty period are only a small proportion of the car parc, more and more analysis is being done to assess the most frequent issues, and this is useful for retailers who are getting into used EVs, so that they can understand what to be prepared for.
According to 2025 data from Warranty Solutions Group (WSG), faults with the charger port are a claim for 3% of the EVs it covers, while onboard chargers are 2.3% of claims. It appears the risk of significant issues with the battery, charger and power distribution components is no higher than the risk of air-conditioning system or TPMS faults. Overall, WSG found EVs and petrol/diesel vehicles have comparable warranty claim rates - 13.21% for EVs versus 13.74% for ICE cars.
Certain models are known to have more issues: WSG’s data showed the Nissan Leaf and MG ZS EV are particularly reliable, with claim rates below 5%, in contrast to other early EVs such as the Tesla Model S, Volkswagen E-Golf and Kia E-Niro, which had claim rates of between 25% and 50%.
DVSA data about electric vehicles, albeit from a small cohort, shows that at the first MOT test at three years-old more have tyre issues than with ICE cars. Early indications suggest suspension units on EVs could also be more problematic as they age, due to the higher weight of the vehicle.
In the DVSA’s 2024 data, 17% of all MOT failures were due to tyres, but for EVs the proportion was higher, at 20%. And 16% of EV MOT failures were due to suspension issues, compared to 15% of all cars. Corrosion of braking system components is also an earlier problem with EVs than it is with ICE cars.
Such data should give dealerships and their customers more confidence with used EVs. For the dealer, displaying an independent battery health check is a useful way of boosting a prospective buyer’s confidence.
Growing numbers of consumers now understand the attraction of used electric vehicles, which have become affordable once the initial new car depreciation hit has passed, but the majority of these will be new to electric motoring.
Uncertainty in the still relatively new technology means that many used car buyers will need extra assurances before they seal the deal on a pre-owned EV given the great expense involved in replacing a failing or ineffective EV battery when it has passed its OEM warranty period.
Currently there is no universally accepted method for measuring battery health. Efforts to standardise assessments are taking time - but it's on the horizon. The EU has implemented Euro7 standards which mandate that BEV and PHEV batteries in cars must retain an energy storage capacity of 80% at 5yrs/100,000km and 72% at 8yrs/160,000km. For LCVs the standard is 75% and 67% for the same usage periods.
The in-market experience
By the point many customers contact or visit the dealership they are ready to confirm their purchase. It’s now that the dealership’s team need to give them that final bit of confidence to buy.
To achieve good volumes of profitable electric car sales a dealership’s team must be confident and genuinely enthusiastic about EVs. Curious customers will have heard all the misinformation and done lots of research but at this point they’re seeking a validation of their preferred choice, and one wrong word spoken could send them away to another dealer’s door.
As car technology and public charging infrastructure continues to improve, the doubts around range, practicality and high upfront costs are being allayed for many consumers. According to EVA England research, these aspects are now a barrier for barely a third of drivers who might consider switching to electric.
High performing dealers have ensured that customer-facing staff have had regular hands-on, practical training which covers topics such as terminology, home and public charging, customers’ common questions and EV technology trends. Staff, both in sales and aftersales roles, will have lived with an EV for at least a few days, so they can also talk positively from a person perspective.
Equipping sales staff with digital tools to help them overcome any of a customer’s concerns is also important. As a minimum, this should include giving salespeople the ability to work out with prospective buyers the potential savings per mile they could achieve as they come out of their petrol or diesel car into a used EV. Given that depreciation has typically levelled the value of a once premium-priced new EV by the time it reaches the used car market, the running cost savings are the most compelling argument.
Customers need to be clear about their options to fund their purchase too. Point of sale motor finance, whether hire purchase, PCP or personal contract hire, offers great convenience to most buyers
High performing used EV dealers go much further, such as providing explainer videos that staff can send to prospects in advance of their visit, or links to sections on their websites with information on different charger connectors, efficient driving tips, guidance about the impact of cold weather, and so on.
Both online and in dealership, a useful sales tool is the provision of a clear EV vs ICE total cost of ownership chart, which includes everything from the Electric Vehicle Excise Duty due to come in force during 2028, service and insurance costs, and home or public charging costs per mile.
Once a customer is confident that an used EV suits their budget, next comes the crucial point. The test-drive experience is vital for prospective EV buyers.
Consumer research has already shown that every experience with an EV, including simply being a passenger, trying one at an event, and getting one as a loan car from the dealership, significantly increases the likelihood of a driver making the switch.
First impressions count and proactively offering a test drive, rather than waiting for a customer to request one, is a starting block to a positive experience. One in every two customers who have to ask the salesperson to get a test drive go on to become detractors, according to JudgeService analysis of dealers’ lost sales. Being proactive is a great start for salespeople to establish a rapport with customers and gain trust.
Offering extended test-drive periods for used EVs is less common than in new EV sales campaigns sales, but it should be at the sales manager's discretion to allow this in certain circumstances.
In any case, the test drive is an opportunity to demonstrate not just the outstanding power delivery that many electric cars have on offer, and the regenerative braking, but also to help the potential purchaser appreciate the peacefulness of EVs in comparison to petrol or diesel cars.
For some consumers a used EV will be the first car they’ve driven with an automatic transmission, and depending on some models it could be the first car that they don’t need to start up, as it could be on once it detects someone in the driving seat.
This all means that dealerships will need to allow a little time for an electric car newcomer to take this all in, without feeling under pressure. While motor industry personnel may be comfortable with EVs by now, they must appreciate that the majority of consumers are unfamiliar with them.
High performing dealers often ensure that accompanied test drives include a brief stop to a public charging station to show the prospective buyer how they easily they would plug the car in.
Supporting Buyers
In an era when buyers can praise or criticise a dealership at the press of a button, for all future prospective customers to see, used car teams must recognise that they should provide support for EV buyers that goes beyond the point of purchase.
The technology on board most EVs is so broad now that it will typically take customers a while to work out all the features and benefits. Being receptive to their questions will pay dividends to the dealership. Reinforcing the expertise of the business, whether it be through advising about future maintenance requirements or helping them discover the apps that let the remotely pre-heat the car, will ensure that when the customer’s friends and colleagues are discussing EVs they’ll hear about the great customer service on offer.
A pro-active dealership should use post-purchase marketing to remind the customer of the great choice they have made and to assure them its customer service and aftersales teams are best placed to help them. In the competitive world of car sales, attracting new customers is important but keeping the existing ones loyal is where increased profitability lies. A dealership with a strong base of repeat customers benefits from higher lifetime value, lower marketing costs, and stronger brand advocacy.
After all, 95% of EV drivers are likely or very likely to recommend EVs to friends or family, according to a survey of more than 1,700 EV drivers by EVA England.
Consumers are gaining confidence, and more and more EVs are reaching the market. So for dealerships, getting better at the business of used EV retailing will help to secure a profitable future.
With the sale achieved, dealers must look to the long term benefits of every contented customer.
Used EV Retailing
41%
of everyday
drivers typically
travel 10-20 miles
in a day
"A useful sales tool
is the provision
of a clear EV vs ICE
total cost of
ownership chart"
Stock selection
Preparation and marketing
The in-market experience
Supporting buyers
Rising fuel costs and growing consumer awareness are accelerating interest in electric vehicles (EVs), but conversion and margin still depend on how effectively dealers translate that interest into confident purchasing decisions.
This EV Retailing Week Q&A with Tim Smith, head of Black Horse Motor Finance examines where EV retail demand stands today, the growing importance of total cost of ownership (TCO), and the role of finance in improving affordability and addressing persistent misconceptions.
How would you characterise the current state of EV retail demand in the UK? EV awareness is at its highest level to date, driven in part by volatility in fuel prices and wider global events. This is reinforcing the whole-life cost benefits of EV ownership while also giving customers reassurance around energy security.
As a result, demand is strengthening and dealers are increasingly prepared to meet it. EVs are now a credible and practical option for a growing share of customers.
Where are the strongest margin opportunities for dealers, and how do they differ from ICE? Used EVs increasingly represent a significant margin opportunity. With production volumes rising, these vehicles will increasingly feature on forecourts, and dealers that build capability early will be best placed to benefit.
Finance remains central, as with ICE (internal combustion engine) vehicles, but Guaranteed Future Values (GFV) within finance deals are particularly valuable in EV conversations, helping to address customer concerns around new technology and future value.
Are you seeing a shift in buyer behaviour? Yes, particularly towards more value-conscious decision making. Cost-of-living pressures mean buyers are focusing more on TCO, including fuel savings, servicing, insurance and predictable monthly payments.
Confidence increases when customers understand what an EV costs per month in real terms, which brings finance into sharper focus.
How are perceptions evolving, and where do misconceptions remain? Perceptions are improving around range, reliability and usability. However, misconceptions persist around affordability, battery life, charging infrastructure and suitability for used buyers.
In many cases, the reality is more positive than customers expect. When dealers clearly explain TCO, real-world range and battery performance, concerns reduce quickly.
Where are dealers missing opportunities to convert EV interest? The biggest gap is often in communication. Customers need clear, accurate whole-life cost comparisons and confident, fact-based answers to new objections.
Dealers that proactively address concerns, rather than reacting to them, are more likely to convert interest into sales. Consistent, evidence-based messaging is critical.
Black Horse has its own myth-busting free resource that includes information and statistics that stands up to real scrutiny.
Click here for Black Horse's free myth-busting resource
Click here for Black Horse's EV driving hub
How does finance de-risk used EV purchases? Finance plays a key role by spreading cost into manageable payments and aligning used EV affordability with ICE equivalents.
It also provides structure around acquiring and future value, helping customers focus on outcomes such as affordability and flexibility rather than uncertainty.
How is Black Horse supporting the used EV opportunity? Black Horse is working with dealers to reduce friction and replace uncertainty with evidence-led confidence. This includes tailored finance propositions, market insight and educational tools to support better customer conversations. The aim is to help dealers stock and retail used EVs profitably on a sustainable basis.
How critical is finance in making EVs accessible?
Finance is central. While interest in EVs is growing, most purchase decisions remain driven by monthly affordability.
Well-structured finance allows EVs to compete directly with ICE vehicles on monthly cost, helping turn interest into commitment.
Are dealers approaching EV finance in the same way as ICE? The fundamentals are the same, with clear and compliant processes underpinning good outcomes. However, EV conversations require greater emphasis on explaining product features, particularly around depreciation and value. Clear, transparent communication remains essential.
What needs to change in how EV finance is presented? Customers need clearer comparisons and explanations of product options. Dealers have an opportunity to address concerns around value and driving an EV using real data.
Presenting finance alongside the vehicle is key to improving understanding and confidence.
How does finance address cost, depreciation and ownership concerns?
Finance reduces upfront cost by spreading payments, addresses depreciation concerns by focusing on usage and the features and benefits of secured lending products. Used effectively, it shifts the conversation from risk to reassurance.
What role does stability in finance play in closing deals? Certainty is critical. Transparent, stable finance propositions reduce hesitation, build trust and help close deals more efficiently, particularly for first-time EV buyers. For dealers, this also supports stock confidence by providing a clear route to sale.
How is Black Horse evolving its EV finance offering? Black Horse continues to review lending policies and residual values to ensure finance products remain sustainable and competitive. The goal is to support repeat engagement and long-term market confidence.
How quickly will EVs reach mass market status?
The transition is already under way and will continue. Used EVs will play a central role, supported by stabilising prices and improved finance affordability. Dealers that build experience now will be best positioned as volumes increase.
What is the key advice for dealers? Stay focused on facts, customer education and clear communication. Helping customers understand EVs, alongside the protections offered by finance products, will be critical.
How is Black Horse positioning for the future? The focus remains on making EV retail simpler, more predictable and more commercially viable, enabling dealers to focus on growth with greater confidence.
The Black Horse EV Driving Hub has been created for you and your customers. A one-stop-shop packed full of information about switching, driving and owning an electric vehicle.
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What more is needed to accelerate EV uptake? Consistency and confidence are key. This includes stable policy signals, continued investment in charging infrastructure, and better alignment between messaging, dealer education and finance.
From a finance perspective, framing EVs through affordability rather than headline price will be central to driving adoption.
How is Black Horse supporting dealers? Black Horse positions itself as an enabler of confidence and conversion for EVs. This includes tailored finance solutions, supporting affordability-led conversations, and providing insight into EV buyer behaviour.
The focus is on helping dealers turn interest into profitable, sustainable sales while ensuring customers feel informed and confident.
How important is the used EV market? The used EV market is critical to mass adoption. While new EVs drive innovation, used vehicles make electric driving accessible to a broader audience, particularly value-driven and finance-led buyers.
As supply grows, the market benefits from increased choice, improved affordability and price transparency, all of which support stronger consumer confidence.
What are the biggest barriers to confidence? Battery health remains a primary concern, often shaped more by perception than reality. Evidence suggests modern EV batteries are durable, with relatively low degradation over high mileages.
Residual value uncertainty and concerns about long-term ownership costs also persist, despite EVs typically requiring less maintenance. The core challenge is translating data into clear, trusted messaging.
What practical steps can dealers take to build trust? Dealers need to lead the conversation. Customers often arrive with incomplete or inaccurate information, and reassurance depends on clarity and confidence.
Bringing real cost comparisons into discussions early, explaining charging options, and integrating finance into the conversation all help. Consistency across teams and messaging is essential.
Black Horse Limited. Registered Office: 25 Gresham Street, London EC2V 7HN.Registered Number: 661204 England and Wales. Black Horse Limited is authorised and regulated by the Financial Conduct Authority.
Inside EV retail:
demand, margins and the road ahead
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