Used EVs Just Hit a Sales Record – a Much Bigger Wave Is Coming

Why It Matters

The surge signals a maturing secondary EV market that can accelerate adoption, improve affordability, and reshape dealer inventory strategies across the automotive sector.

Key Takeaways

• Q1 used EV sales hit 37,000 units at Manheim.
• Retail used EV sales exceed 100,000, second‑best quarter.
• Year‑over‑year wholesale EV sales up 12%, Q4 2025 up 17%.
• Off‑lease EVs to reach 15% of fleet by 2026.
• Higher gas prices and lease returns boost inventory.

Pulse Analysis

The recent spike in used‑EV transactions reflects a convergence of market forces that go beyond seasonal demand. Higher gasoline prices have nudged cost‑conscious consumers toward electric alternatives, while the expiration of the $7,500 federal tax credit has created a wave of off‑lease vehicles re‑entering the market. These factors, combined with a robust wholesale platform like Manheim, have produced a record‑setting quarter that underscores the growing liquidity and price stability of the used‑EV segment.

Dealers are adapting quickly to the influx of pre‑owned electric models. Lenders have refined financing structures to accommodate the residual‑value gaps that arise when lessees walk away, ensuring that inventory can be absorbed without depressing prices. This evolving financing ecosystem, together with a steady supply of off‑lease EVs, is enabling dealers to offer competitive pricing that rivals new‑car incentives, thereby expanding the buyer pool and accelerating turnover rates.

Looking ahead, the trajectory suggests that used EVs will become a cornerstone of the broader automotive market. Industry forecasts project that by 2026, EVs will constitute roughly 15% of all off‑lease vehicles, up from 7.7% in Q1 2025. This growth will likely pressure manufacturers to consider secondary‑market strategies, such as certified‑pre‑owned programs and battery‑health warranties, to retain brand loyalty. As the secondary market matures, it will also provide valuable data on battery longevity and resale values, informing future policy and consumer confidence in electric mobility.