The prices of used electric vehicles went up this year. Analysts called this "unusual." They're describing supply and demand like it's a magic trick.
Here's what happened: fewer people bought new EVs because they cost as much as a kidney transplant. So they turned to the used market. Demand went up. Prices followed. This violates the "law of used cars" the same way a 2-for-1 sale at Costco violates the Geneva Convention.
The law states that used cars depreciate. They lose value. They become worthless hunks of metal that your cousin Travis drives to his shift at Applebee's. Except when people actually want to buy them. Then the law takes a vacation.
Experts credit "affordability" for the shift. Buyers wanted electric cars but couldn't afford new ones, so they paid more for old ones. This is the same logic that explains why people finance a $900 iPhone over 36 months. It's not affordability. It's financial illiteracy with a credit score.
High gas prices helped too. Drivers saw $5 gallons and decided a used Chevy Bolt from 2019 with 60,000 miles and a battery range that tops out at "maybe the grocery store" was suddenly worth $28,000. They did this math in their heads. They felt smart about it.
The real story: a "law" that only works when nothing changes got disrupted by things changing. Analysts acted surprised. Buyers acted rational. Sellers got paid.
Next quarter someone will write this same article about used hybrid prices or used Toyota Tacomas or whatever else people convince themselves is an investment instead of a depreciating asset they'll sell at a loss in four years.
The law of used cars isn't dead. It's just never applied to people who think paying interest on a Nissan Leaf is a hedge against inflation.
Photo by Erik Mclean on Unsplash
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