Buying an electric car – The buying party is over

With loan interest rates rising, food prices rising and most people's purchasing power declining, it is not surprising that the automobile market has been affected.

New car sales fell sharply. In March, 9,750 new cars were sold, the lowest number since 2009. 90 percent of them were electric cars, and those who buy cars are choosing cheaper cars.

It wasn't long before cars like the Audi e-tron and Porsche Taycan were topping sales in Norway and were almost universally owned. Many cost from NOK 800,000 to over NOK 1 million.

Now they are gone from the top of the new car. In the list of best sellers for March this year, we see that affordable cars like the Volvo EX30, MG4 and VW ID.3 are increasing sharply.

The shopping spree is over

Many importers have cut prices on expensive cars sharply to keep sales up, but that doesn't seem to be helping.

We are seeing a new trend in the automobile market, says Director Øyvind Solberg Thorsen of the Road Information Board (OFV).

– New car sales fell sharply in the first quarter of this year – especially in March. In addition, most people are now choosing smaller, more moderate cars than they have in the past five or six years. Torsen believes this trend will affect new car sales in the future as well.

– Many major car manufacturers now see a large market for smaller, less expensive cars, not least electric cars. In the future, there will be many smaller and more affordable electric cars on the Norwegian market. At the same time, there will be cars that meet the needs of many people and can quickly challenge established brands and models, Thorsen says.

This is the amount you can save

Car maintenance calculations recently published by OFV show that there is a lot to be saved by choosing a less expensive car.

If you buy a new electric car that costs NOK 685,000 and drives 15,000 kilometers per year, it will cost you NOK 141,000 per year. All costs are then taken into account, including loss of value.

“Kills” the scope

If you choose a car for NOK 515,000, it will cost you NOK 111,000 per year. In other words, NOK 30,000 saved annually. If you get a car that costs NOK 335,000, you will get NOK 81,000 per year. Another NOK 30,000 to save.

The fact that people can afford less and move away from expensive cars is also being felt in the used market. Prices here have almost collapsed over the past year, thanks to Tesla cutting the new car price of many of its models by more than NOK 100,000 in January 2023.

It sent shock waves through the market, not only among new car competitors, but also in the used market. Prices have dropped.

Used car deal

You can now buy a good used Tesla Model A Porsche Taycan, which cost NOK 1.2 million three years ago, can now be purchased for NOK 600,000 to NOK 700,000. When the Chinese company Hongqi came to Norway in 2021, sales skyrocketed. More than 2,000 cars, many priced at around NOK 800,000, were moved in one year. Last year, 11 cars were sold and now you can buy the 2022 model from NOK 450,000.

The market for more expensive luxury used cars is characterized by many people who want to sell, but few who want to buy, confirms head of analysis Jonathan Barr in Rebel used car dealer.

Shatters the myth of China

Popular cheap cars

“The price decline began in September 2022, when the supply of used cars built up. Prices fell further when Tesla sharply reduced prices for its new cars in January 2023. The most expensive electric cars saw the largest price drops. Across models, we saw prices fall by about 30 percent Throughout the year,” Barr wrote in the Rebel report.

He says prices for affordable cars have remained steady throughout the year. In fact, the prices of some models increased because the competition for these cars was great among customers. Barr believes that used prices for more expensive cars will stabilize in 2024.