New energy used cars are trapped in a circulation dilemma, having depreciated by over 65% in three years.

Recently, Tesla owners have been taking turns to show the residual values of their vehicles on social platforms.

The estimated quote for a Model 3 Long Range All-Wheel Drive version less than a year old is 174,000 yuan. Compared with the guide price of 275,500 yuan, the owner has lost 100,000 yuan.

The estimated quote for a Model 3 Performance version that is just one year old is 221,000 yuan. Compared with the guide price of 339,500 yuan, its retention rate is even lower than that of the Long Range version mentioned above.

The estimated quote for a Model Y Rear-Wheel Drive version purchased in 2022 is 134,000 yuan, and its residual value is only about half of the selling price.

What a dismal situation!

Picture/Model Y, Source/Screenshot from Internet's New Energy Outlook

The retention rate of NIO ET5 is not much better. An ET5 that cost 260,000 yuan to purchase at that time can only be sold for a little over 110,000 yuan two years later, which means a loss of 140,000 yuan. If calculated based on the guide price of 298,000 yuan, the loss would be even greater.

In the view of Zhang Li, the person in charge of Hefei Beihanxing Automobile Sales and Service Co., Ltd., such a retention rate is "quite normal." So, if the owners are losing money, does it mean that the car dealers must be making money? Obviously not. Zhang Li believes that the downgraded consumer power and the price war in the new car market force second-hand car dealers to achieve high turnover. If the inventory cycle is long, car dealers will definitely be "hit." Usually, the reasonable inventory cycle for second-hand cars is about 30 days.

However, according to the research data of the China Automobile Dealers Association in June 2025, second-hand car dealers with an inventory cycle of less than 15 days account for 29.9%, those with an inventory cycle of 15 - 30 days account for 34.6%, and those with an inventory cycle of more than 30 days account for 35.6%. The average inventory cycle is 43 days.

This may mean that operating at a loss is the norm for second-hand car dealers. If car dealers cannot operate healthily, how can consumers who buy second-hand cars ensure their legitimate rights and interests?

1. The New Energy Second-Hand Car Market is in a Double Bind

In 2025, the sales volume of new energy vehicles in China is expected to exceed 20 million, with an annual growth rate of over 30%. However, the new energy second-hand car market presents a different picture: on one hand, the owners' dreams of high residual values are shattered; on the other hand, car dealers are deeply mired in difficulties.

New energy vehicle owners are experiencing asset "evaporation" far beyond expectations. The latest data from the China Automobile Dealers Association shows that the average three-year depreciation rate of new energy second-hand cars is as high as 65%. In some extreme cases, certain models have seen their values "halved in one year and reduced to zero in three years." A flagship model of a certain brand purchased in 2022 for 280,000 yuan was listed on the platform for only 85,000 yuan three years later, a decline of 70%, which made the owners exclaim that it was "unacceptable."

Even more, Mr. Zhang, a car owner in Shandong, spent 440,000 yuan in 2019 to buy a long-range all-wheel-drive Tesla Model 3. With the birth of his second child, Mr. Zhang planned to trade in this car for a larger SUV. However, after the 4S store offered a quote of 70,000 yuan, Mr. Zhang gave up the idea of changing cars.

Picture/Model 3, Source/Screenshot from Internet's New Energy Outlook

"Apart from the slightly small space, the range and handling of my car are still okay. Most importantly, apart from the annual insurance, it basically doesn't cost much. There is a charging pile at home, and I can change the air-conditioning filter myself. I'll drive it for a few more years," Mr. Zhang said helplessly.

If the low residual value is due to the long service life of the car, consumers may still be able to accept it. However, the impact brought by the technological iteration of car manufacturers often catches the owners off guard. For example, only half a year after the launch of a certain leading brand's 2023 model, due to the upgrade of the battery in the new model, the residual value of the old model instantly evaporated by 40%, causing a large number of complaints.

In a survey of tens of thousands of people on a certain automobile forum, 87% of the respondents admitted that "the depreciation speed of new energy vehicles exceeded their tolerance range," which directly led to 23% of potential buyers abandoning their purchase plans.

In fact, car dealers are walking on thin ice in the new energy second-hand car market.

For example, a second-hand car dealer had in stock a popular 2023 model. Due to a 40,000-yuan price cut of the new car, the dealer was forced to lower the listed price of the second-hand car by 28,000 yuan within a week, resulting in a single-vehicle loss exceeding the expected 40%. There is almost no buffer period for this price transmission because in some aggressive brands, there has even been an inverted phenomenon where "the selling price of new cars is lower than the purchase price of second-hand car dealers."

Meanwhile, the after-sales guarantee policies of different brands and models vary greatly, and some rights and interests cannot be transferred with the vehicle, which further exacerbates consumers' concerns. Buying a car means taking on potential disputes and high warranty costs.

In addition, leasing companies' large-scale low-price disposal of retired operating vehicles (such as the aforementioned three-year-old cars with a residual value of less than 20%) has severely impacted the retail market price system, squeezing the profit margins of ordinary second-hand car dealers to the limit. Car dealers are afraid of overstocking when buying cars and worried about after-sales guarantees when selling cars. They are caught in a vicious cycle of "not daring to buy and even more difficult to sell."

2. How was the Dilemma Formed?

This seemingly hopeless dilemma is actually tightly bound by an invisible net from four directions: technological iteration, price war, industry mechanism, and market chaos.

The speed of technological iteration is so fast that it makes people breathless. Some founders of new car-making forces have even clearly stated that new energy vehicles today are like electronic products in the past.

Among the tens of thousands of parts of a new energy vehicle, the battery, as the "heart" of an electric vehicle, often accounts for more than 40% of the total vehicle cost. Just think, right after consumers pick up their new cars, a few months later, car manufacturers may equip their cars with a new generation of battery technology with higher energy density and faster charging. The market value of the old models will immediately decline.

Picture/Proportion of Lithium Battery Cost in Common New Energy Vehicle Models, Source/Screenshot from Internet's New Energy Outlook

Not to mention the endless stream of intelligent assistance systems, intelligent cockpits, and in-vehicle systems. Every time there is a model upgrade, it seems to announce that the assets of old owners are "accelerating depreciation." What consumers hold in their hands is not just a car key, but more like a block of ice that is doomed to melt quickly. The case of a flagship car that has lost 70% of its value in three years has already shattered people's most basic expectations for asset preservation.

The fierce price war in the new car market has also mercilessly hit the second-hand car market. When a leading brand suddenly cuts the official price by tens of thousands of yuan to seize the market, the pricing system of the corresponding second-hand cars collapses instantly. The cars that car dealers bought at the old price in their warehouses have already suffered book losses before they can find buyers.

The most absurd thing is that sometimes, after the promotion of new cars, the price is even lower than the purchase price of second-hand car dealers, resulting in a shocking "price inversion."

Seeing the continuous decline of new car prices, consumers naturally tighten their wallets and adopt a wait-and-see attitude of "waiting a little longer." As a result, the inventory of second-hand car dealers piles up for longer and longer, and their capital chains are on the verge of breaking.

In addition, the attractive "first-owner rights and interests," such as lifetime warranty and free battery swapping, often disappear after the vehicle changes hands. The rights and interests protection of second-hand car owners is seriously insufficient. Car dealers therefore bear huge potential after-sales costs and dispute risks. The entire industry also lacks a scientific and widely recognized retention rate model and residual value evaluation system. Pricing is more like groping in the dark, full of trials and uncertainties.

Picture/National Average Price of Second-Hand Cars, Source/Screenshot from Internet's New Energy Outlook

Market chaos acts like a catalyst, constantly eroding the already fragile trust foundation of the second-hand car market. Some gray operations, such as taking advantage of policy loopholes to create "zero-kilometer second-hand cars" for arbitrage, have seriously disrupted the normal market order and price system. Even more, some people tamper with the mileage data through technical means and disguise old cars as "nearly new cars." This kind of behavior is like killing the goose that lays the golden eggs, overdrawing the credibility of the entire industry.

All these factors are intertwined, forming an unsolvable deadlock. When both buyers and sellers are struggling, the liquidity of the market is like a river blocked by mud, and the new energy second-hand car market has fallen into a deep-seated systemic dilemma.

3. New Energy Second-Hand Car Dealers Have Something to Say about Turning the Dilemma Around

For second-hand car dealers, changing this dilemma is obviously more urgent.

Zhang Li said that if the purchase subsidies for new cars cannot be cancelled, he hopes that new cars and second-hand cars can have equal subsidies. Another hope is to completely eliminate zero-kilometer second-hand cars. In Zhang Li's view, zero-kilometer second-hand cars are more harmful to the second-hand car market. "We operate a product normally and have a relatively stable market situation. But suddenly, a batch of zero-kilometer second-hand cars appears on the market, and the situation collapses instantly."

The so-called zero-kilometer second-hand cars usually refer to vehicles that are resold as "nearly new cars" immediately or within a short period after registration, usually with a mileage of less than 50 kilometers. Although they all seem to be in excellent condition, their negative impact on the second-hand car market involves the price system, market order, consumer rights and interests, and the industry ecosystem.

Picture/The Strange Phenomenon of Zero-Kilometer Second-Hand Cars, Source/Screenshot from First-Hand Investigation of New Energy Outlook

Zero-kilometer second-hand cars not only cause the pricing system of new cars to fail but also further squeeze the price space of second-hand cars. Take a certain champion model of a new energy leading enterprise as an example. The price of a new car is more than 70,000 yuan, while the price of a zero-kilometer second-hand car is only more than 50,000 yuan, a decrease of 28.6%. The cost-effectiveness of the new car disappears instantly. The second-hand cars of the same model with a mileage of 10,000 - 20,000 kilometers or even the same year that second-hand car dealers bought are often more expensive than them. Overnight, they become hot potatoes and can only be sold at a big loss.

Zero-kilometer second-hand cars often hide the risks of consumer rights and interests being damaged and other problems. For example, car manufacturers often refuse to provide warranty for the three-electric system (battery, motor, and electronic control) on the grounds that "transferred vehicles do not enjoy the rights and interests of the first owner." Then, when car owners encounter problems with the battery, etc., they can only repair it themselves or claim insurance, suffering heavy losses.

Picture/A Certain Brand's "Three-Electric" Lifetime Warranty Only Applies to First Owners, Source/Screenshot from Internet's New Energy Outlook

In addition, zero-kilometer second-hand cars have the problems of mileage tampering and the disguise of exhibition cars or inventory cars. Consumers have difficulty tracing the source and are easily deceived. It seems that without eliminating this cancer, the new energy second-hand car market will not be able to achieve real clarity.

In fact, to turn the dilemma of the new energy second-hand car market around, we can also start from aspects such as technological standardization, the extension of manufacturer responsibilities, and business model revolution.

For example, the "Battery Residual Value AI Evaluation System" jointly launched by Changan Automobile and CATARC has achieved a prediction accuracy of 91% for the residual value fluctuations in the next three years, allowing consumers to have a clear idea. Another example is NIO's BaaS battery rental service, which separates the battery asset. Users do not need to bear the battery depreciation risk, and the residual value of a three-year-old car has increased by 27%.

In terms of business model revolution, Ping An Property Insurance has launched a "Residual Value Lock-in Insurance," through which car owners can get compensation for the difference according to the valuation at the time of insurance purchase; Geely has launched a "Whole Vehicle Subscription Plan," allowing users to pay monthly and upgrade to the latest models at any time; CATL has established a battery asset operation platform to achieve standardized replacement of battery packs for different