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The Rundown
This is the question we find ourselves asking more and more. Gas prices are going down steadily, but they have not dropped to the low gas prices we had only a couple of years ago. As a result, we find ourselves asking should I make the switch over to an electric car? We are only going to focus on the bottom line today. There are plenty of other factors that go into purchasing a car and deciding whether to go electric throws a whole wrench into the process. Besides knowing what range you may need, the most important factor that goes into purchasing a car is the price you will be expected to pay. When we talk about purchasing an electric car or internal combustion (IC) vehicle, there are quite a few costs to compare.
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The Arguments we have all heard
Electric vehicle fans or owners will always bring up the low maintenance costs and lower electric prices that comes with owning an EV. They are not wrong, electric vehicles do generally have lower maintenance costs year over year compared to gas cars, electricity is also generally cheaper than gas. Combustion engine fans will immediately respond with the high upfront costs for an electric vehicle. They also are not wrong, electric vehicles are generally the price of an entry level luxury vehicle. The electric version of a combustion vehicle can be up to $10,000 more than the standard version. Electric cars with more impressive ranges and the creature comforts most of us are used to easily start north of $60,000. These arguments are both valid, and it really comes down to these factors and how long you plan on owning the car.
The Factors that Affect Cost
There are quite a few factors that affect this comparison. We already mentioned a couple, higher entry level cost and lower maintenance costs for electric vehicles. On top of that to properly charge an EV most consumers purchase the proper level 2 charging station for their vehicle, another $2,000 on top of the vehicle purchase. Fortunately this includes the station itself and the installation fee. There is also about a $400/year maintenance cost for the charging station. Then there are depreciation factors for both electric vehicles and regular cars. Electric vehicles tend to depreciate much quicker than a regular vehicle. This is due to the fact that outdated ranges can quickly become unattractive to prospective EV buyers. Consider how much you drive, and how long you intend to own the car and it makes a huge difference in if the vehicle is cost effective
The Verdict
In 2020 Car and Driver did a cost analysis between the Kona with an IC engine and one with an electric engine. They found that after three years of ownership the Electric Kona is significantly more expensive, almost $8,000 dollars more. The same is true for most electric vehicles. Electric vehicles are generally not cheaper in the long run. The two big contributing factors to this are the depreciation of the vehicle, and the high up-front cost. If you have to replace a battery? Forget about it. If you factor in the entire life of the car, around 200,000 miles, over this duration of time and miles the electric car may become more cost effective for you than the gas car. This is due to the decreased cost of charging and maintenance. The most important takeaway: the longer you own an electric vehicle, the more you will save. In the short run a gas powered car will save you thousands, if not tens of thousands.
Summary
A number of factors go into every purchase, and making the switch to an electric vehicle adds a whole level of complication to the purchase. Knowing what you intend for the vehicle and your own circumstances are paramount. When you do your cost analysis make sure to use all of the above factors and compare the gas car you want to the electric car you want. This will enable you to decisively say which vehicle is better for you and yours.