Hybrids are also trending in the used car market… ‘Prices are falling’, different from electric cars [CAR톡]

Hybrid cars, which are eco-friendly cars, are emerging as a trend in the domestic used car market. Customer preference has increased as it requires less charging and price burden compared to electric vehicles and is economical, including higher fuel efficiency than internal combustion engine vehicles. Accordingly, the market price of used hybrid cars is showing a steady trend, but the price of used electric cars is falling rapidly and is in a recession.

According to the automobile industry on the 25th, the number of consumers choosing used hybrid cars has been increasing significantly recently. More than 8 out of 10 consumers looking to purchase a used car are interested in hybrid cars. As a result of K Car, a directly managed used car platform company, conducting a survey of 500 people aged 30 to 59 across the country, 84.4% of respondents responded that they wanted to purchase a hybrid car. In the used car market, there is a clear trend of preferring hybrid vehicles over internal combustion engine vehicles such as gasoline and diesel, or electric vehicles.

It is analyzed that the increased market interest in hybrid vehicles has been influenced by their excellent economy and eco-friendliness. In fact, respondents cited ‘high fuel efficiency (67.5%)’ as the biggest reason for purchasing a used hybrid car. In addition, various benefits such as employment registration tax reduction and discounts on public parking lots (14%), followed by eco-friendliness (10.7%).

The purchase price of a hybrid vehicle is more expensive than an internal combustion engine vehicle, but it is interpreted to reflect the sentiment that it is more economical because the vehicle maintenance costs are lower and various benefits are available. In addition, the fact that there are fewer safety issues compared to electric vehicles and that there is no inconvenience due to insufficient charging infrastructure is also considered to be a popular factor.

The popularity of hybrid cars is also reflected in used market prices. According to K-Car, the market price decline rate for used hybrid cars last month was flat at an average of 0.4%. This is a relatively low rate of decline in the market price of hybrid cars, considering the nature of used cars, which depreciate by about 1% every month.

K-Car CEO Jeong In-guk said, “The fact that it is simpler than electric vehicles and boasts high fuel efficiency compared to internal combustion engine vehicles seems to be attractive to consumers,” adding, “As rational consumption is highlighted due to high oil prices and economic recession, hybrid vehicles are becoming more popular.” “Popularity will continue to increase,” he said.

On the other hand, the price of used electric vehicles has been falling steadily in the second half of this year. Looking at K-Car statistics, the average decline rate of used electric vehicles, which was flat (-0.2%) in July of this year, expanded every month and reached -2.5% in October. Even compared to gasoline (-0.6%) and diesel used cars (-0.4%), the decline rate for electric vehicles is high.

Until last year, used electric vehicles boasted high prices, with prices being traded at a premium. However, as the demand for electric vehicles decreased due to increased purchase costs due to high interest rates and insufficient charging infrastructure, the mood in the used car market reversed. Due to price cuts by manufacturers and expansion of government subsidies, the actual purchase price of a new car, which is the reference point for calculating the market price of a used car, has decreased, which has also had an impact on the decline in the market price of used cars.

This weakness in electric vehicles is expected to continue for the time being. According to K-Car’s analysis of 740 models distributed in the domestic used car market within 12 years of launch, the average price of used electric vehicles is expected to fall by about 2% this month. Some models of imported brands, such as Volvo’s C40 Recharge (-8.4%) and Renault Zoë (-8.1%), are expected to drop by more than 8% in one month. Domestic brands Hyundai Motor Company’s IONIQ 6 and Kia’s Soul EV are expected to drop by 4.9% and 4.5%, respectively. An industry official said, “Even in high oil prices, the market price for used electric vehicles is expected to remain weak for the time being due to various factors.”