Fuel type is one of many factors that influence a car’s resale value. Just as key variables like age, condition, and mileage affect its worth, powertrain type also plays a role.
You’ll see various fuel types on the road, from traditional petrol and diesel cars to eco-friendlier electric and hybrid models.
If you're selling your car, understanding how fuel type affects its resale value can help you navigate the market and secure the best price for it.
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How does fuel type affect the value of your car?
When considering your car’s resale value, it is important to understand how each fuel type holds value within the car market:
Petrol is the dominant powertrain on UK roads. Thanks to their lower purchase prices, and high consumer confidence, petrol cars benefit from lower initial depreciation rates.
Meanwhile, diesel cars often have lower resale values due to concerns around emissions and looming restrictions such as the 2030 ban on the sale of new internal combustion engine (ICE) cars.
On the other hand, the green technology found in electric and hybrid cars is helping them to hold value, as the Government continues to roll out policies and invest in infrastructure to support an electrified road network.
Market demand and regulations that affect certain car models such as emissions caps and chargeable emissions zones (e.g. London’s ULEZ) are also key factors when it comes to resale value.
Which fuel types hold their value?
Every fuel type has its pros and cons, which can ultimately impact the overall resale value of your car:
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Petrol
Petrol is the most popular car type on UK roads. Thanks to this ubiquity, petrol car buyers benefit from more choice and attractive pricing. The pricing for new petrol cars tends to be lower than other fuel types, although the price gap between petrol cars and electric vehicles (EVs) is narrowing.
Resale values for petrol cars often take a hit when fuel prices rise. In summer 2022, when fuel prices peaked, resale values for petrol cars suffered due to the increased running costs. Petrol cars are usually the most expensive to run, despite their lower upfront costs, and are less efficient on longer drives.
This is a concern for many drivers, as the cost of living is at the forefront of their minds. It is also expected that petrol cars’ prices and resale values will continue to fall as the 2030 ICE ban draws nearer.
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Diesel
Diesel cars are more fuel-efficient than petrol equivalents on longer drives, making them an excellent choice for buyers who make long distance commutes on a regular basis.
They also have a higher torque (ability to produce power), making them an optimal choice for towing. Diesel engines also tend to last longer and require less regular maintenance compared with petrol equivalents, which can help drivers save on running costs.
However, the initial purchase price for diesels is higher than equivalent petrol models.
What’s more, due to their higher emissions (which makes some older models liable for daily charges in the ULEZ and similar zones) and the approaching 2030 ICE ban, many diesel cars are holding on to less of their resale value than other fuel types.
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Electric
Electric cars utilise green technology to create zero tailpipe emissions and typically cost less to refuel and run than petrol and diesel models. Thanks to the UK’s growing public chargepoint network, electric motoring is becoming an increasingly practical option for many car buyers.
What’s more, all EVs are exempt from the daily charges in the ULEZ and similar zones. EV drivers are also exempt from road tax until April 2025 - and EVs used as company cars have more favourable benefit-in-kind (BiK) tax rates than higher-polluting equivalents.
Although early EV models were troubled by concerns over range limitations and reliability, the technology has improved significantly with more recent iterations. Thanks to growing public acceptance and Government policies pointing towards an electrified future, EV resale values are currently strong.
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Hybrid
Hybrid technology combines a traditional petrol or diesel engine with one or more electric motors to improve efficiency and reduce emissions.
Despite being cheaper than fully electric cars, hybrid models still offer many of the same benefits, including meeting the emissions requirements for the majority of chargeable zones such as the ULEZ.
Although they are a little pricier than traditional ICE cars, hybrids hold their resale value well as a more attractive, eco-friendly alternative.
Fuel type comparison chart
We’ve created a comparative chart to help you understand the factors that contribute to value retention for various powertrain types:
| Powertrain type | Fuel efficiency | Towing capability | Performance | Emissions and ULEZ compliance | Car value retention | Purchase price |
|---|---|---|---|---|---|---|
| Petrol | Moderate | Moderate | Good | Produces more CO2 than hybrid and electric models. Most petrol cars produced after 2005 are ULEZ compliant. |
Moderate | Low to moderate |
| Diesel | High | Excellent | Good | Typically emits more CO2 than petrol, hybrid, and electric models. Most diesel cars registered after September 2015 are ULEZ compliant. |
Declining | Moderate |
| Electric | Very high | Limited | Moderate | Zero emissions and always ULEZ compliant. | Increasing | High |
| Hybrid | High | Moderate | Good | Low emissions and always ULEZ compliant. | Stable | High |
Do petrol cars hold their value better than diesel models?
Yes, due to the recent focus on emissions and the increased environmental impact of diesel cars, petrol models tend to hold on to more of their value.
This change in buyer preferences was influenced by the high cost of diesel compared to other fuel types, along with the expansion of the ULEZ, and the rollout of new chargeable emissions zones in various parts of England and Scotland.
The daily charges levied within these zones affect more diesel models (especially those registered before September 2015). A smaller number of petrol models are affected – and this tends to be predominantly older cars registered before 2005.
However, it’s important to note that some used diesel cars can command good prices. For instance, a modern diesel car that’s in good condition with an intact warranty and a low mileage may be worth more than an equivalent petrol model that hasn’t been looked after to the same standard.
Individual buyer preferences will also play a role. Diesel cars excel at towing, long-distance driving, and typically last longer in terms of mileage than petrol models. If you find a buyer who values these qualities, they may be willing to offer a more favourable price.
Petrol cars tend to hold their value better due to emissions rules, but a well-maintained diesel can still sell for a good price.
When should I sell my car?
The optimal time to sell your car depends on your needs and priorities. However, if you’re focused on getting a good price for your motor, it’s important to pay attention to Government policies and market conditions.
The approaching 2030 ban on the sale of petrol and diesel cars is part of the Government’s efforts to encourage the widespread adoption of electric cars – and meet their net zero emissions by 2050 target.
As the deadline draws nearer it’s expected that resale values for traditionally fuelled cars will continue to fall, especially for diesel models. So, if you’re deliberating over when to sell your petrol or diesel car, now could be a great time to take the leap!
It’s anticipated that resale values for hybrids and EVs will be more stable over the coming years. However, the sale of new hybrid cars is set to be phased out by 2035.
Therefore, EVs are currently the most future proof car type. With that said, no matter how your car is powered, it’s important to consider other value factors such as age, condition, and mileage.
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