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The cost of a used car is about to soar – here's why - The Telegraph

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The 2030 ban on petrol and diesel car sales is now only 80 months away. Five years after that, a further ban on hybrid cars will erase internal combustion from showrooms and new forecourts entirely, leaving British motorists with a potentially difficult choice – buy an electric or hydrogen car, or try to rely on the dwindling supply of used petrol and diesel models on the market. 

For many, the answer will be obvious – buy an electric car (EV), which by that point should be a little better and a lot cheaper than anything on sale currently. But EVs currently represent a significant downgrade in convenience and practicality when compared with their internal combustion engine (ICE) counterparts – at least for some users – and as such, that deadline is looming rather fast for a lot of UK drivers.

Almost everybody recognises the need to decarbonise road travel, and acknowledges the effect that burning fossil fuels has on the local and global environment. But simultaneously, people have less money to spend, and lives that have been based around cheap superminis and inexpensive, readily available petrol can’t always accommodate more expensive EVs and convoluted charging rituals. 

Despite the looming deadline, consumer reluctance could even be growing. Research by Forbes Advisor suggests that 62 per cent of people think the UK isn’t ready for a ban in 2030, and 42 per cent say the ban should be scrapped entirely. A recent AA survey suggests that the percentage of car owners considering an EV is dwindling slightly, falling from about a quarter to less than a fifth over the past few years. Data from Auto Trader reflects this; interest in new EVs has fallen by about two-thirds.

Nice little earner: George Cole as Arthur Daley, the ultimate used-car salesman Credit: ITV/REX

The 2030 and 2035 petrol and diesel bans

Used cars powered by petrol and diesel will continue to be available after the nominal cutoff date – you just won’t be able to buy or lease new ones. That means that while the supply of brand-new pure internal combustion cars will have largely ceased in seven years’ time, there will still be some on the used market for as long as they’re mechanically viable. 

Assuming the life expectancy of a car to be between 10 and 20 years, that means you’ll be able to get your hands on a used model until perhaps 2050, beyond which the sound of the Otto cycle is likely to be as rare as a steam locomotive’s whistle.

But the precise moment at which the number of internal combustion cars will begin to irreversibly dwindle remains to be seen – manufacturers have already begun planning the end of their petrol and diesel ranges ahead of the 2030 ban, and many will cease production of fossil-fuel engines in the next five years or so. 

That’s likely to do very strange things to the market. Given the widespread belief that the end of the internal combustion era is approaching too rapidly, and the as-yet inadequate support for electric or hydrogen cars, it’s almost inevitable that demand for “conventional” cars will outlast their supply to some degree – unless there are significant and rapid developments in EV infrastructure in the meantime.

Used petrol and diesel car prices

We’ve already experienced a preview of this phenomenon. The value of used cars has soared consistently since the Covid restrictions of 2020, due to decreased supply and increased demand – the production of new cars was stifled by lockdowns and supply-chain issues, Russia’s invasion of Ukraine and the global semiconductor shortages. Fewer new cars being built means fewer cars to enter the used market.

And as cash-strapped Brits eschew big spends such as new cars and opt for more cost-effective secondhand purchases, strain is put on that finite number of used cars on the market. Compounding this problem is the lack of three-year-old leased vehicles coming to the market at the end of their initial terms; not many people chose to take out a new lease in March 2020, for obvious reasons.

Used-car prices are up by almost a third since the beginning of the pandemic Credit: Alamy

Consequently, used-car prices are up by almost a third – or more than £4,000 – since the beginning of the pandemic.
So, we already know a bit about what happens when more people want used cars and fewer are for sale. But as we approach the 2030 ban, manufacturers will gradually stop building any more pure petrol or diesel models, which pushes demand even further past supply. 

Many manufacturers plan to go “fully electric”, that is, not sell any internal combustion engines, well ahead of the regulatory deadline. It seems unlikely that used petrol or diesel car prices will stop rising, making it increasingly difficult for people to get their hands on vehicles that run on old-fashioned unleaded.

Used electric car prices

There’s an exception to this rule, however. While the value of petrol and diesel cars on the secondhand market is soaring, the price of used EVs is dropping markedly. A lot of that has to do with the growing uneasiness about the expense and practicalities of EV ownership.

Electric cars are significantly more expensive than their most comparable petrol rivals – a used Nissan Leaf might cost £10,000, while an equivalent Ford Fiesta might be £4,000. Given the cost of living crisis, the high price of new EVs (about 37 per cent more than an equivalent petrol car) squeezes a lot of Brits out of the market. And while there have been significant developments in charging infrastructure, trying to charge an EV anywhere but your own driveway is still a palaver.

High prices: the electric Nissan Leaf

So, an electric car is vastly more expensive and far less practical for a lot of buyers than (much more affordable) petrol models, which is a particularly tough sell during a cost of living crisis. Tumbling values disincentivise dealers from stocking these difficult-to-shift products, and make financing less affordable – leasing deals are priced based on projected used values. To make matters worse, there’s an energy crisis, too, making EVs even more expensive to run. 

Kevin Pratt, car insurance expert at Forbes Advisor, says: “It’s easy to see why motorists are reluctant to make the change from fossil fuels to battery-powered motoring. The average cost of a new EV is £61,320 and it comes with an average range of 219 miles for a full charge, but a new ICE car costs an average of £29,018 with a median range of 413 miles for a full tank, so paying twice as much for half the driving distance doesn’t seem like a good deal at face value.”

Electric car servicing and repairs

In addition to understandable gripes about purchase price and practicality, potential EV buyers are unclear about whether local third-party garages – which have served petrol and diesel motorists for many decades – are capable of providing the same service to electric drivers once their cars are out of warranty. 

Aside from problems in manufacturing, there’s a looming crisis in the number of qualified vehicle service technicians, who are in an ageing and slightly unpopular profession that struggles to attract new entrants. That’s particularly true for electric vehicles, which require additional knowledge and training. The Institute of the Motor Industry (IMI) says that about 39,000 mechanics are now qualified to work on EVs, but that a shortfall of 16,000 is still predicted.

“Despite a long-held belief that EVs – with fewer moving parts – will be quicker to service than their ICE counterparts, in-depth analysis conducted by the IMI for our response to the MOT Consultation suggests otherwise,” says Steve Nash, CEO of the IMI. 

“In particular, tyre wear on electric vehicles is heavier than on ICE models. According to Garage Industry Trends’ analysis of MOT test data for 2021, EVs had a failure rate of 11.43 per cent for vehicles registered in 2018 and having their first test compared with 10.45 per cent for petrol vehicles – and the weak point was identified as tyres.”

Tyres have been identified as a ‘weak point’ for EVs Credit: Getty

Training staff, purchasing equipment and orchestrating the complex electronic systems required to service modern cars can all be prohibitively expensive for smaller garages, which have had to modernise in line with technological advances, but which might not be prepared for the very latest EVs – some of which don’t even have bonnets. Andy Turbefield, head of quality and training at Halfords, is unfazed by such challenges in relation to large organisations such as his, but says that smaller garages face tough decisions.

“Technology continues to march on,” says Turbefield. “It’s difficult enough for those of us in the industry to keep up with it, let alone smaller garages in rural communities.

“I’m from that background myself, so I understand the challenges. It’s certainly viable for small garages, but they’re at a sort of junction. Do they keep doing what they’ve always done for a limited amount of time, or do they diversify?”

But given the likelihood that a substantial number of “conventional” cars will remain after 2030, even if they get more expensive by the day, many smaller garages will opt to specialise.

“Let’s be honest, petrol and diesel cars are still going to be on the roads for a significant amount of time after 2030,” says Turbefield. “So there’s absolutely nothing stopping those smaller independents from maintaining what they currently do for a while longer. All of us in the sector expect petrol and diesel vehicles to be on the road in 2040.”


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Land Rover Defender

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Mazda MX-5

Now in its fourth generation, the MX-5 has remained true to the ethos of the no-frills British roadsters of the 1950s that inspired it. The earliest models (1989-1998) offer the purest driving experience

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Ford Focus Mk1

Family hatchbacks rarely rewrite the rulebook, but in the late 1990s the Focus (replacing the stodgy Escort) combined driving pleasure with practicality like no other mass-market car in history

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BMW 5-Series E39

Germany’s finest: beautifully proportioned, with the usual lineup of silky-smooth BMW straight-six petrol engines – plus diesels and later a V8. A superb all-rounder in Touring estate form, too

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Tesla Model S

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