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Used-car Residual Values in Europe: A Look at the Normalization and Decline Trend in 2025

Used-car residual values (RVs) in Europe are expected to continue their normalization and decline through 2025, following two years of exceptionally high levels. This trend is evident from recent financial data and market observations showing a steady fall in revenue contributions tied to used-car prices, indicating RV corrections across the market.

The decline in RVs is influenced by several key factors. Global political upheaval and international conflicts have indirectly pressured economic conditions and consumer confidence, likely contributing to fluctuations and adjustments in used-car values.

Another significant factor is the transition to cleaner and smarter mobility. The aggressive shift toward electrified vehicles is transforming fleet compositions, with Renault reporting that 59% of its vehicles sold in early 2025 are electrified. This shift is expected to impact demand patterns for used vehicles, gradually reducing demand and therefore residual values for traditional internal combustion engine cars, while potentially supporting stronger RVs for electrified vehicles.

Leasing companies and fleet managers, such as Arval, anticipate that the dip in used-car revenues related to the end of windfall disposal profits will start to dissipate later in 2025. However, overall downward pressure on RVs remains due to market normalization. The goal to lease large numbers of battery electric vehicles globally by 2026 signals a structural mobility transition further influencing used-car market dynamics.

Business models focusing on sustainability, repair, refurbishment, and extending vehicle lifespans are emerging in Nordic and broader European markets, reflecting growing consumer awareness and regulatory pushes toward environmental benefits. These trends may moderate the pace of RV decline for some vehicle segments but also reinforce the move toward newer, cleaner vehicle technologies.

In terms of specific market trends, Italy's used-car RVs fell by 4pp to 48.7% in December 2024. The average number of days needed to sell a used car increased to 61 days in Germany during the same month. In Austria, the average number of days needed to sell a used car increased to 70.5 days in December 2024, and RVs are expected to decrease by 2.2% by the end of 2025.

Spain's used-car market is expected to exceed 10% growth compared with 2023, with double the number of used-car transactions compared to new registrations. The rental channel was the primary driver of growth in Spain's new-car market in December 2024 and across 2024.

The UK was the only major market where RVs slightly increased, reaching 51%. HEVs led the market with a %RV of 52.2% in Germany, while BEVs retained the lowest level of value at 38.2%. In Italy, BEVs suffered the greatest year-on-year drop of 5pp, hitting 30.5% on average in December 2024.

In summary, used-car residual values in Europe in 2025 are expected to decline from previously high peaks as the market normalizes, shaped strongly by geopolitical factors and the rapid ongoing transition toward electrified and smarter mobility solutions. The future trajectory will likely feature differential RV trends, with ICE vehicles facing more pressure and electrified models gaining in value stability or growth.

The shift toward electrified vehicles in Europe's mobility sector is not only transforming fleet compositions but also potentially impacting casino-and-gambling revenues, as the demand for traditional internal combustion engine cars decreases.
In education-and-self-development forums, discussions on the future of transportation are increasingly centered around the normalization and decline of used-car residual values in Europe, providing insights into technology trends and the climate's effect on lifestyle choices.
General-news outlets are reporting on specific market trends, such as Spain's used-car market surpassing 10% growth in 2025, while sports analysts eye the implications of dwindling used-car residual values on the economy, particularly the leasing industry.
Meanwhile, weather forecasts for the coming year may have less influence on used-car residual values, as the trend toward electrified vehicles and market normalization continue to shape the industry throughout 2025.