Is it time to consider an EV when looking for a new car?

Posted By on February 26, 2022

Well according to the calculations by automotive journalist Lauren Fix, if it is the financial calculation that triggers your decision, you might want to hold off a little on buying that new EV … even with tax incentives.

Electric Car vs Gas Costs: Which Truly Saves You The Most Money?

By Lauren Fix

There is a push for every driver to switch to electric, while almost every automaker has invested billions of dollars into expanding their electric vehicle lineups with hopes that you will make the switch. Consumers need to the math and see what works best for them and your budget and not be pressured in to what may or may not work for you. What are the costs? Many are debating between electric car vs gas costs rages on: which one will save you the most money overall? Let’s look at the numbers, there is plenty to think about.

When you compare the cost comparison between gas and electric, there are six factors that can fluctuate but are critical to doing the math. Most EV’s still have higher-than-average starting prices, discouraging plenty of cost-conscious buyers. The cost of regular gas-powered cars don’t come with any tax credits. Then there are factors like auto insurance, general maintenance, and resale value to consider. You also have to weigh the costs of filling up the tank at the gas pump versus charging your EV charger, either at home or at public charging stations. Here’s how everything breaks down.

Purchase price is The average price for a brand new EV is about $55,000. That’s considerably higher than the average four-door sedan, which runs about $35,000, according to Kelly Blue Book. Tax credits and gas savings can save you money, however, it’s going to take a few years to make up a potential $20,000 difference. The are some lower cost EV’s like the Nissan Leaf, KIA Soul, Hyundai Kona and Chevy Bolt EV, the average EV is much more expensive. EV’s still demand a larger financial commitment than gas-powered cars. The average cost of a home charger plus installation is $2000

Tax credits can help lower the price of a new EV, the average federal tax credit through rebates vary from state to state and by brand, ranging from $2500 to $7500. Plug-in Hybrids offer lower rebates and no rebate for gas or diesel vehicles.

Insurance is a big factor to consider, the average cost of an electric car is 23% or more expensive because the car itself and parts cost more to repair and replace. Gas powered vehicles cost less to repair if in a collision.

Cost of fuel, as the price of gasoline raises so does the the cost of electricity. The average fuel costs does fluctuate, as the government is not helping lower gas costs, but as of today $1,120/year. The annual cost to operate an electric vehicle though the costs differ as well, is about $485/year and have a home charger can lower those fees.

What about maintenance, you will hear some people say there is none on EV’s, that is not true. If there are moving parts there is maintenance, there are less moving parts but the annual costs are about $900 / year and around $1200 / year for gas or diesel engines.

The bottom line:

The average length of time drivers keep a new vehicle is about 6 years, with an average yearly cost of $3300 for EV’s and $3900 for gas powered cars, what are the totals cost for both over that time.

Totaling all factors is $71,770 for EV’s and $58,664 for gasoline powered cars. You’ll never make up the initial expense difference over the lifetime of your more expensive electric vehicle. Spending tens of thousands of dollars on any vehicle is a big decision for most people, so it’s worth digging deeper into the true overall cost of each vehicle.

No matter which kind of car you end up with, we have plenty of great tips on how to save money when buying a new car.

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