EV Values Plummeting Faster Than Hybrids, Says Cox Automotive

Hello, Champions of Net Zero!

In a striking shift within the automotive landscape, recent data from Cox Automotive Europe reveals a significant divergence in the residual values of electric vehicles (EVs) and hybrid vehicles. The findings indicate that electric vehicles have experienced a drop in residual values nearly double that of their hybrid counterparts, raising important questions for both consumers and industry stakeholders.

As of November 2022, the residual values of hybrid and electric vehicles stood remarkably close, with only a two-percentage-point difference—90% for hybrids versus 88% for EVs. Fast forward to July 2023, and the landscape has shifted dramatically. Hybrid vehicles that are less than 24 months old held a respectable 68% of their original cost, down 22% from their peak, while electric vehicles of the same age plummeted to just 49%. This stark contrast highlights the volatility currently affecting the market for these vehicles.

Philip Nothard, the insight director at Cox Automotive, elaborated on the findings, stating: “Hybrid vehicles offer drivers an alternative, cost-effective solution for buyers who want to transition to a more sustainable form of transport but have concerns around range or infrastructure. This is driving demand for them in the used car market, which helps support stronger residuals. Additionally, these vehicles have a lower cost of entry than their electric equivalents, which means they hold their value better when entering the used market.”

However, it’s important to note that this resilience may soon face new challenges. Recent policy changes have introduced tax regulations that could deter buyers from opting for hybrid vehicles. As of April 2023, owners of hybrid vehicles registered after 2017 face the same vehicle tax rates as traditional petrol and diesel cars. Furthermore, the Zero Emission Vehicle (ZEV) mandate will phase out the sale of hybrid vehicles by 2035, casting a shadow over their long-term viability.

Despite these challenges, the appeal of hybrid vehicles remains strong in the UK. New consumer data from Regit and Cox Automotive shows that nearly one in three drivers (29%) are considering a hybrid vehicle for their next purchase. Additionally, recent new car registration data highlights a 31.5% increase in registrations of plug-in hybrid electric vehicles (PHEVs) and a 6.5% increase for hybrid electric vehicles (HEVs) year-to-date.

Nothard remarked, “Hybrid vehicles represent a lucrative opportunity for UK drivers and the automotive market today, which is evident in the success of many new market entrants coming to the UK with hybrid offerings. They deliver a clear lifetime cost advantage over internal combustion and electric vehicles, making them an attractive option for buyers hesitant or cautious about making the full electric transition. Yet, evolving government policy could undermine this potential if hybrid ownership becomes less financially viable.”

Turning our attention to the used electric vehicle market, new figures from Marketcheck reveal that values for used EVs have hit their lowest level in two years, despite a surge in buyer demand. The data indicates that a record number of used EVs were sold in July 2025—21,902 units—marking a nearly threefold increase from just 7,512 units sold in July 2023.

This growth trend is further underscored by the sales volume data from earlier this year; in January 2025 alone, 16,227 used EVs were sold, reflecting a 39.97% increase in volume compared to the same month in 2023. Interestingly, while sales volumes are surging, the average last-listed price of used EVs has dropped significantly. Over the two-year period, the average price fell by £5,214.59—from £27,762.00 in July 2023 to £22,547.41 in July 2025, representing an 18.8% decrease.

As the year progresses, this downward trend in prices has continued, with January 2025 seeing an average listed price of £24,352.41, a 7.41% decrease from the previous year. Alastair Campbell from Marketcheck UK commented on this phenomenon, stating, “July saw the highest number of used EVs ever sold in a single month, and at the lowest average price we’ve recorded. In just two years, prices have dropped by more than £5,000, while sales volumes have surged. That combination of falling prices and rising demand shows the market is becoming both more accessible and more mature. For many UK buyers, a used EV is now a realistic and attractive alternative to petrol and diesel.”

Further reinforcing these trends, Dealer Auction’s recent report indicates a 12.6% rise in margins for alternatively fuelled vehicles (AFVs) in July. The latest edition of the EV Performance Review (EVPR) highlights that popular AFV models continue to dominate the market. The figures reveal that the plug-in hybrid Volvo XC90 leads the margin chart, achieving a retail margin of £5,886 with an average selling time of just 31 days.

In the realm of hybrid vehicles, the data showcases several models that are consistently favoured by buyers. These include the Lexus RX (£3,993 margin), Tesla Model 3 (£3,986 margin), and Toyota RAV4 (£3,335 margin). Notably, the overall trend indicates that buyers are gravitating towards vehicles known for their reliability and efficiency, suggesting a maturing market where trusted names remain prominent.

Kieran TeeBoon, the marketplace director at Dealer Auction, remarked: “Month after month, we’re seeing the same popular models leading the AFV market. It’s a clear sign that buyers know what they want—vehicles with a strong reputation for reliability and efficiency. This level of consistency suggests a mature market where trusted names continue to stand out.”

As we look ahead, it will be fascinating to observe how these trends evolve, particularly in light of the new EV grant and changing consumer preferences. The potential impact of government policy on hybrid vehicles is also a crucial aspect to monitor, especially as the automotive industry navigates the challenges of transitioning towards a more sustainable future.

In conclusion, the dynamic landscape of electric and hybrid vehicles continues to unfold, presenting both opportunities and challenges for consumers and the automotive industry alike. With evolving market conditions, government regulations, and shifting consumer preferences, staying informed is essential for making the right choices in this rapidly changing environment.

Stay tuned to the Net Zero News Network for more updates and insights on the journey towards a sustainable future!