EVs Hold Value Better Than Expected as Cost of Living Bites 2026

Electric vehicles are holding value better than expected, defying long-held scepticism about their depreciation, as Australia's cost of living crisis pushes buyers toward cheaper running costs. Recent auction results show used EVs fetching surprisingly high prices, challenging the notion that they rapidly become worthless.

Why Used EVs Are Defying Depreciation

For years, critics warned that used electric vehicles would plummet in value due to battery degradation and evolving technology. However, a recent auction in Australia turned that assumption on its head. After a concrete spray incident, 40 repairable BYD vehicles were sent to auction by insurers. With fuel prices soaring, a bidding frenzy erupted, with thousands of buyers competing for the cars. "The prices we generated were incredible," said Brendon Green, general manager of automotive solutions at Pickles. "The amount of views, bidders, and bids were extraordinary compared to what we typically see."

This shift isn't isolated. Salvage EVs with pre-accident values up to $40,000 are fetching substantially higher prices than comparable combustion models. Even written-off EVs sold for spare parts and second-life batteries are commanding premiums. The driving force? Australia's cost of living crisis, which has made fuel efficiency a top priority for households.

The Role of Australia's Cost of Living Crisis

With petrol prices hitting record highs, drivers are increasingly turning to electric vehicles to slash their weekly expenses. The savings are substantial: charging an EV can cost up to 70% less than filling a petrol tank. As a result, demand for used EVs has surged, propping up their resale values. This trend is particularly pronounced in Australia, where the distance between charging stations and the prevalence of home solar panels make EVs an attractive proposition.

Moreover, the supply of used EVs remains limited, further boosting prices. While new EV sales are growing, the secondhand market is still in its infancy, creating a supply-demand imbalance that favours sellers. This dynamic is expected to persist as more Australians seek relief from rising fuel costs.

Comparing EV and Petrol Resale Values

To illustrate the shift, consider the following comparison of average resale values after three years:

As the table shows, EVs are now retaining more of their original value than their petrol counterparts. This reversal is prompting industry experts to reconsider long-standing depreciation forecasts.

Key Takeaways for Buyers and Sellers

• Used EVs are appreciating in relative terms due to high fuel prices and limited supply.
• Cost of living pressures are driving demand for electric vehicles, supporting resale values.
• Petrol cars may depreciate faster as fuel costs rise and environmental awareness grows.
• Battery health and charging infrastructure remain critical factors for long-term value.

FAQ

As Australia's cost of living crisis continues, the used EV market is likely to remain robust. For buyers, this means acting quickly to secure a vehicle that could save thousands in fuel costs. For sellers, it's an opportunity to capitalise on strong demand. Either way, the narrative around EV depreciation is changing—and it's driven by economics.