The Affordability of Electric Cars is Increasing


Electric vehicles (EVs) are rolling into the driveways of blue-collar America—in style. Thank the growing choir of carmakers dropping prices, a chorus of federal tax credits and state incentives, and a symphony of technology advancements—300-mile trips on a single charge and a 36% growth in fast chargers in just one year. So, even if the Republicans in Congress try to end the EV subsidies party, the market forces keep the beats dropping and the EV prices falling. So, let’s all turn down for watt and drive into an affordable, all-electric future.

Electric Vehicles: No Longer Just for the Elite

Alex Lawrence, a seasoned used electric vehicle (EV) dealer in Salt Lake City, has noticed a shift in his clientele over the past year. Instead of professionals splurging on $70,000 Rivian luxury pickup trucks, he’s seen more customers picking up used Teslas for a touch over $20,000, factoring in a $4,000 federal tax credit.

“We’re seeing younger people, and more blue-collar and entry-level white-collar folks. EVs have suddenly become attainable,” Lawrence observes.

While some critics view EVs as toys of the liberal elite, their accessibility is growing. Falling prices, due to increased competition, lower raw-material costs, enhanced manufacturing, and tax credits, are making them increasingly affordable.

Simultaneously, rapid advancements in technology are making EVs more practical. Cars with a range of over 300 miles on a full charge are becoming the norm, and charging times are shrinking. The number of fast chargers, capable of juicing up a battery in under 30 minutes, swelled by 36% from April 2023 to April 2024.

Leading automakers like Tesla, Ford, General Motors, and Stellantis, owner of Jeep, have even announced plans for EVs priced as low as $25,000.

A New Dawn for the EV Market

“The EV market has hit an inflection point,” says Randy Parker, CEO of Hyundai Motor America, which is set to start manufacturing EVs in Georgia by year-end. “We’ve transitioned to a mass market.”

The Biden administration, aiming for half of new cars sold to be electric by 2030, and advocates of EVs, are welcoming this momentum. Even potential policy shifts by Republicans, aiming to dismantle EV subsidies, may not reverse the market forces driving prices downward.

Still, EVs, while experiencing a slowdown in sales recently, remain more expensive than gasoline models, costing an average of $55,252 in the US in April. However, this is a 9% decrease from April 2023, and estimates predict EVs capable of 400-mile range will cost less than their internal combustion counterparts by 2030 (pickup trucks will reach this point by 2033).

These calculations don’t consider the lower fuel and maintenance costs that EVs offer. Electricity almost always costs less per mile than gasoline, and EVs don’t need oil changes, engine air filters, or spark plugs. Some automakers are even offering hefty discounts on EV models to lure buyers.

Challenges and Opportunities

Despite promising trends, challenges remain. China, supplying over half of the lithium-ion batteries for US-sold cars, may see prices rise due to increased tariffs by the Biden administration. And while more companies are building battery factories in the US and Canada, they won’t reach production capacity for several years.

Fluctuating commodity prices, supply of raw materials, and the recent slump in EV sales growth have caused companies like Tesla and Ford to delay expansion plans. However, many expect a resurrection in sales as more models become available, prices fall, and the charging network expands.

For many, the car’s price isn’t the only consideration. People living in apartments often rely on public charging plugs, which can be costlier and less convenient than home charging.

Still, factors pushing prices down are formidable. Manufacturing costs are falling as traditional automakers apply their mass-production expertise to new technology.

Later this year, for instance, General Motors is planning to sell an electric Chevrolet Equinox SUV with a range of over 300 miles for under $30,000 after the federal tax credit. An even cheaper model, a new Chevrolet Bolt, is scheduled for next year.

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