PALO ALTO, Calif. — Jane Koca grinned
as she stepped out of a Tesla Model S at
a neighbor’s ride-and-drive event, where
half a dozen models were on display. Her
next car, she said, will be a plug-in.
“I’ve been waiting,” she said. “Each year,
they get better and better.”
The rollout of new and second-generation
plug-in models that can go longer on a
single charge by major automakers has
ushered in what some analysts call a
second era in electric vehicles. As a
response, sales of plug-in cars in recent
months have been ticking upward, despite
low gas prices. Older models have made
their way onto an increasingly flourishing
used car market.
It remains niche enough, however, that
incentives can play an outsized role.
For example, the used Toyota Prius plug-
in hybrid is selling around twice as fast
this year as last year on used car website
iSeeCars.com, and twice as fast as the
average car. More than half of them are
sold in California — and the state’s
infamous traffic is part of the reason.
“California has stopped giving out
stickers for high-occupancy vehicle lane
access for single occupants of plug-in
vehicles,” said Phong Ly, CEO of
iSeeCars.com. “Really, the only way to
get one is by buying a used plug-in. It
could be a factor at play.”
The three fastest-selling models across
the website from January to May were the
Toyota Prius plug-in hybrid, the Nissan
Leaf and the Tesla Model S. EVs as a
group are getting snatched up 10 days
faster than gasoline-powered cars on the
website.
Alternative fuel cars are also selling in
larger numbers and at a lower prices on
the website than last year, according to
an analysis by the firm.
Most American families can’t afford a new
car, according to a Bankrate Inc. study
released last week. The average new car
sells for $33,865, according to Kelley Blue
Book, and a new plug-in car costs more.
But used cars are getting cheaper.
So far this year, prices for used EVs
dropped 15 percent from the same period
last year, and the price of used plug-in
hybrids dropped 5 percent, according to
iSeeCars.com. By comparison, the price
of used gasoline-powered cars dropped 1
percent.
“You have a lot of 1-to-3-year-old
models coming off lease,” Ly said. “The
lower prices have hit a sweet spot, and
maybe that’s why people who are
generally reluctant may take a chance in
buying.”
A used Nissan Leaf, first introduced in
2010, is now selling at an average of $
12,533, a drop in more than $2,000 from
last year. That’s in part because cars
coming off leases in Georgia are flooding
the market. The state was a top market
for EVs because of a $5,000 tax credit
until the incentives were ended last
summer. Now, the share of used EVs sold
in the state has doubled. People as far as
Missouri have been snatching up the
cheap Georgian Leafs.
1% OF NEW CAR SALES
Sales of new electric cars reached 1
percent of total U.S. new car sales for the
first time in June, which environmentalists
applauded as a milestone.
So far this year, sales of new plug-ins
have been near or at record levels every
month. High-end models, like the Tesla
Model S and X or the BMW i3, have
dominated, overtaking the previously
popular Leaf and Volt.
The total volume of sales remains below
expectations. California and nine other
states have mandated that zero-
emissions vehicles make up 15 percent of
sales by 2025.
Sales of the plug-in vehicles dipped last
year, but Scott Shepard, senior research
analyst at Navigant Research, resisted
tying that trend entirely to low gas prices.
“The people who are going after that
technology are going after it because it
has a plug, not because it has significant
cost savings,” he said.
Instead, he suggested people were
waiting for newer models. For example,
General Motors Co. announced the
second generation Chevrolet Volt, with an
electric-only range of more than 50 miles
compared to the previous range of less
than 40, early last year. It was first
introduced in 2010. Sales of the Leaf, the
most popular EV, have stagnated among
news of an imminent second-generation
car.
“Every time we see a new and improved
plug-in technology, there’s this effect
where first generation models tends to
decline in anticipation of the next vehicle
model,” Shepard said. “You don’t see that
among conventional established markets
because there’s not a whole lot of
improvement.”
Shepard projects a record year for plug-
in sales in Canada and the United States,
driven by the introduction of new models.
He expects sales to reach an optimistic
200,000, a 62 percent increase from last
year.
Sales aren’t on track to reach that so far.
The introductions of the $30,000, 200-
mile-range all-electric Chevrolet Bolt; the
Prius Prime plug-in hybrid EV, which
doubles the range of its predecessor; and
the Mitsubishi Outlander plug-in hybrid
EV, an SUV already popular in Europe,
later this year could boost midmarket
sales, he said. Sales of the Tesla Model X
and second-generation Chevrolet Volt will
also keep gathering steam, he suggested.
Nearly 400,000 people have already put
in pre-orders for Tesla’s 215-mile-range
Model 3, which could sell for less than $
30,000. It is expected at the end of 2017.

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