Nearly 80% of new electric vehicles (EVs) were sold at discounted prices last month as the industry faced a decline in consumer demand, according to Auto Trader data. This marked an increase from 55% the previous year, with 77% of new EVs listed at reduced prices.
The extent of the discounts is also growing, with the average markdown reaching a new high of 11%.
This trend coincided with Tesla’s recent price reductions across its markets in China, the United States, and Europe due to slower sales. In China, prices for Tesla’s Model Y were lowered from 263,900 yuan to 249,900 yuan (£28,500). In the U.S., the entry-level Model Y’s price dropped to $42,990 (£35,000), and in Germany, the Model 3 rear-wheel-drive was reduced by €2,000 to €40,990.
Auto Trader noted that a similar percentage of petrol cars were also being sold at discounts, indicating broader challenges in the automotive sector. However, price reductions for EVs are more significant, with around 31% of EVs experiencing cuts of at least 10%, compared to 24% of petrol cars.
This indicates that dealers are compelled to lower prices to boost sales significantly due to a global decrease in demand for electric vehicles. Industry data shows that sales of battery-powered cars fell by 11.3% across Europe in March.
Experts believe that these price reductions are beneficial for consumers, especially since high costs are still considered the primary hurdle to the broader adoption of EVs.
However, these price cuts also highlight the difficulties manufacturers encounter as they strive to achieve new UK sales targets introduced this year.
According to the new zero-emissions vehicle mandate by the Government, 22% of vehicles sold by major automakers must be electric in 2024. This requirement will increase steadily until a total ban on new petrol and diesel vehicles takes effect in 2035.
