Transport & Environment (T&E) says electric vehicles are retaining their value better than conventional industry depreciation estimates suggest, based on an analysis of used-car transactions in four major European markets.
The analysis covers Germany, France, Italy and Spain and examines how depreciation estimates are used in leasing and financing calculations. T&E found that accounting for several factors omitted from commonly used calculations reduces the estimated depreciation gap between combustion and electric cars by about 80%.
T&E Identifies Factors Affecting EV Depreciation
Data from 2025 used-car transactions across the four markets showed a 12.9 percentage-point depreciation gap between combustion and electric vehicles, according to T&E.
The organisation said the calculation does not fully account for five factors that can affect vehicle values. These include purchase subsidies for electric vehicles, acquisition taxes on fossil-fuel vehicles, inflation, differences in fleet composition and changes in new EV pricing.
T&E said subsidies and acquisition taxes, together with inflation and fleet composition, reduce the original gap by 5.2 percentage points. The stabilisation of new EV prices reduces the estimated average depreciation of electric vehicles by a further 5.1 percentage points, leaving a gap of 2.6 percentage points.
T&E Calls for Changes to EV Leasing
T&E said leasing companies could respond to stronger demand for used electric vehicles by offering longer lease periods and second-hand EV leasing products.
The organisation also called on automakers to standardise battery health certificates and approved-used vehicle programmes. It said these measures could provide buyers with greater information about the condition of used electric vehicles.
T&E is also supporting the proposed Corporate Clean Vehicles Regulation (CCVR), which would establish electrification targets for large corporate fleets. The organisation argues that more predictable demand could help reduce remaining differences in depreciation between electric and combustion vehicles.
“The industry is painting an overly simplistic picture of EV depreciation to justify opposing EU fleet electrification targets,” Stef Cornelis, director of the Electric Fleets and Freight programs at T&E, said.
“In reality, binding targets create market predictability, allowing leasing companies to manage depreciation with greater certainty,” Cornelis added.
Used EV Markets Show Increasing Demand
T&E’s analysis found that depreciation volatility for electric vehicles was similar to that of fossil-fuel vehicles in both halves of 2025 across the four markets.
The organisation also pointed to recent used-EV market developments in Ireland and Germany. In Ireland, used EV values increased at almost twice the rate of petrol and diesel vehicles year on year in July 2026, according to the country’s largest online car marketplace.
In Germany, sales of used battery-electric vehicles increased 64% year on year during the first seven months of 2026. T&E said the increase in transactions could contribute to higher used-EV values in the German market.
Cornelis said changes in fuel prices could further influence consumer demand for electric vehicles.
“With high fuel prices hitting EU drivers hard, rapid electrification is the only real solution,” Cornelis said. “Rather than subsidising fossil fuels, we must activate existing policy levers to support private drivers and businesses in making the switch.”
