Why Are Used Car Prices Dropping So Much?

The quarterly observatory of La Centrale reveals a collapse in the average price of used cars. Why is this a lasting trend?

The argument of Covid and the pressure on supply chains is outdated. Now, manufacturers have no choice but to offer discounts again to attract customers and increase their production volumes to pay salaries.

This growing influx of new vehicles, combined with the mechanics of supply and demand, means that customers now have more choices for selecting their future vehicle.

Another real phenomenon: the French are buying fewer new cars, preferring long-term rental or purchase option offers. As a result, those looking to get rid of their cars have no choice but to lower the price they are asking for.

What does the trend from La Centrale say?

In its observatory for the first quarter of 2024, La Centrale, the leading site for the sale of used vehicles in France, is clear: the average price of a used vehicle has decreased by 2.6% compared to the previous quarter. This represents an average drop of 590 euros per car. Over the past year, the drop is -4.7% or -1080 euros.

Recent vehicles, aged between 2 and 4 years, are the age group that has decreased the most: -3% or -700 euros on average.

Finally, vehicles with electric and/or hybrid engines are those that lose the most value: -4.4% or -1400 euros on average! The obsolescence of their technology, coupled with ongoing innovation, quickly renders their performance outdated. Over the past year, this category has seen prices plummet by 12.6%, or -4390 euros on average!

In detail, electric cars are the most affected: -6.4% over three months or -1700 euros. The fluctuation of Tesla’s prices may not help.