Electric vehicles (EVs) have gone from being a rare sight on Indian roads to an increasingly common choice among new car buyers. With government subsidies, rising fuel costs and environmental concerns driving the shift, it is safe to say that the EV movement has picked up speed. But as more people lean towards electric mobility, it’s also changing how we look at the used car market. If you’re wondering how EVs are affecting used car prices in India, here’s a breakdown that will help you stay ahead of the curve.
EV Adoption is Climbing Fast in India
Over the last few years, EV adoption has grown steadily. From under 1% of total car sales in 2020, EVs now account for over 3% of India’s passenger vehicle market. According to data from the Ministry of Road Transport and Highways, EV sales in India reached over 15 lakh units in 2024, with a major share coming from electric two-wheelers and passenger cars. With brands like Tata, MG, Mahindra and Hyundai aggressively expanding their electric line-up, this upward trend is only expected to grow further.
This steady adoption of EVs is not just changing new car buying patterns. It is also pushing more internal combustion engine (ICE) vehicles into the used car space, which brings us to the next shift.
How EV Demand is Reshaping the Used Car Market
As new EVs become more affordable and accessible, many petrol and diesel car owners are upgrading to electric. This is increasing the supply of ICE vehicles in the used car market.
Despite more used petrol and diesel cars available, the prices of used cars especially the petrol-powered vehicles, the prices are continuously rising because of high demand. However, the prices of diesel cars are falling due to stricter emission norms.
At the same time, buyers are becoming more cautious when considering ICE vehicles that may face restrictions in the future, especially in metro cities where emission norms are getting tighter. This shift in buyer preference is pushing down resale values for some older models.
If you’re planning to sell used car before switching to an electric vehicle, this could be an ideal time. Petrol models with strong mileage and low maintenance costs are still fetching good resale prices, making it easier for sellers to upgrade to an EV without a significant financial gap.
Popular used cars models with strong demand and better mileage still hold good resale value. It’s the older or less efficient vehicles that are feeling the pinch the most.
Are Used EVs Becoming More Affordable?
While EVs are cheaper to run, their high upfront cost has been a barrier for many new car buyers. But that’s changing. As new EVs enter the market at competitive prices, older electric models are also becoming available at lower prices in the used market.
That said, used EV prices are not dropping dramatically. Most buyers are still wary about battery health, limited range, replacement costs and charging infrastructure. These concerns often lead to longer decision-making time and some negotiation before finalising the deal. But for those who understand EVs well, the used market offers a cost-effective entry into electric mobility.
What’s Holding Back Used EV Prices From Rising
Lack of resale history: Unlike petrol or diesel cars, EVs are relatively new in the market and don’t have decades of resale data. This makes it harder for both buyers and sellers to estimate how much value the vehicle will retain over time.
Battery health concerns: The battery is the most expensive part of an EV. Buyers are usually cautious and want detailed reports on battery performance, range, and remaining life. Unfortunately, not all used car dealers can provide this level of detail.
Uncertainty around warranty transfer: In some cases, the original warranty does not transfer to the next owner. If this happens, or if the car brand has a limited service network, the resale value can drop significantly.
Perceived value mismatch: Even though EVs have lower running costs, many used EVs are priced slightly lower than expected. This is mainly due to the concerns above, which reduce buyer confidence during resale.
Used Electric Cars Summary
| Factor | Impact on Used EV Prices |
|---|---|
| Limited resale history | Makes it difficult to predict depreciation trends, unlike traditional petrol/diesel cars. |
| Battery health uncertainty | Concerns about battery life, range, and performance reduce buyer confidence unless proper diagnostics are provided. |
| Warranty transfer issues | If manufacturer warranty doesn’t transfer or support is limited, buyers are less willing to pay a premium. |
| Rapid tech updates | New EV models with better range and features are launching quickly, making older models seem outdated faster. |
| Government incentives | Subsidies and lower registration fees for new EVs make used EVs less attractive in terms of overall cost-benefit. |
| Lower running costs | While EVs are cheaper to run, this advantage alone does not yet offset concerns about longevity and reliability in the used car market. |
| Service and support challenges | A limited number of workshops equipped to service EVs can worry potential buyers, especially in smaller cities or towns. |
What Should Sellers Keep in Mind?
If you currently own a petrol or diesel vehicle, the growing EV market is a signal to time your sale smartly. Diesel ICE cars may see faster depreciation as EVs become more mainstream and affordable. On the other hand, if you own an EV, its resale value will largely depend on battery condition, brand reputation, and the demand in your city.
In either case, knowing the fair market price of your vehicle is essential. You can use tools like used car valuation to check your car’s current worth and make informed selling decisions. With prices shifting every few months, staying updated can help you avoid underselling or missing the right opportunity.
Final Thoughts
No, electric vehicles are not significantly affecting used car prices, at least not yet. The number of used EVs in the market is still too small to cause any major shift in pricing trends. In contrast, prices of new cars have continued to rise, making them unaffordable for many aspiring buyers. As a result, people are now turning to quality used cars as a smarter, more budget-friendly alternative. Some buyers may explore used electric cars out of curiosity or specific needs, but that’s more of an exception than a rule. For now, used ICE car prices, especially petrol-powered vehicles, are expected to rise steadily in line with growing demand for pre-owned vehicles.
