Electric car prices up 13% due to supply and demand issues

Demand for EVs remains high despite the rising prices, DoneDeal have said. 

Soaring demand and lack of supply has driven the average cost of a new electric vehicle (EV) up 13% compared to the same time last year, a new analysis by DoneDeal has revealed.

Despite these price increases, demand for brand new EVs has increased by 35% in 2023. The analysis found that there is significant demand for EVs in Ireland but the limitation lies with the supply shortage which results in inflated prices.

According to the report, as of May 17 the average cost of a new EV was €64,755 — an increase of 13% compared to the same period last year.

The trend is also seen in the second-hand market with EVs that are between one and four years old. The average price in 2023 is €42,661, a 10% increase on 2022 prices.

DoneDeal said the price rises in the EV market are “indicative” of the price increases it is seeing across the board in the motor Industry for all car types.

The company said the shortage of new EVs has put a strain on supply in the market, which exacerbates the pricing issue.

The reduction of the EV grant, due in July, is also fuelling the increase in demand as people try to make the switch to electric before then.

The analysis said that the market is still developing and that economies of scale as well as improved battery technologies should improve the pricing situation, but “that effect isn’t likely to be felt until the close of this decade”.

According to DoneDeal, for the first time in 2023, an electric car, the Volkswagen ID.4, is the most popular car among all car types.

The ID.4 had previously claimed the top spot between September and December of last year before being overtaken again in January 2023 by a diesel car, the Peugeot 3008. The Volkswagen ID.5 is the only other EV represented in the top 10 most in demand new cars in 2023.

Ireland’s most popular new car being an EV, coupled with the increase in demand, shows there is significant market demand for EVs in Ireland.