Does it make financial sense to buy an electric vehicle right now?
With gas prices higher than I can remember in my lifetime, I can’t be the only one thinking about making the switch to an electric vehicle
I seriously considered ditching the gas pump and plugging in a couple of years ago when I was in the market for a new car. I did my research on charging stations, range, power and reliability and decided Tesla would be my choice if I were to cross over.
I did a test drive at my local Tesla service center and loved nearly everything about it. I likened the immediate torque to flying a rocket ship. A tap of the foot and the powerful acceleration is immediate. The huge touch screen and abundance of hi-tech made me smile. The only annoyance was the black smudge from the seatbelt that rubbed off on the white exterior — a minor design flaw.
My larger concerns were about repair issues and costs. Tesla drivers are often so converted that it can be tough to know if their glowing reviews are accurate. One of my friends emailed me that his Tesla was passing 50,000 miles and that maintenance costs had been “pocket change.”
Not even the people working at the service center could answer my biggest question about how much the battery would cost to replace when it was time. I received answers like, “We don’t know anyone who has had to replace a battery” or “These batteries last so long, you’ll probably never need to replace it.”
Probably wasn’t enough for me. One day, the battery would need to be replaced and I had heard rumors of outrageous costs.
One obstacle I came across when I was asking around was that most Tesla owners I knew still had cars under a bumper-to-bumper warranty. I decided to wait a few years until some of those Teslas needed repairs to see how costs would play out. I also wanted to give other auto manufacturers a little time to make advancements in their electric offerings.
It hasn’t quite been two years since all my research, but now I’m spending more than triple my usual gas budget and the prospect of going electric is looking even more appealing. So today, in 2022, is it time to make the switch?
Most often, an electric vehicle will cost more at purchase than a conventional car. But a 2020 Consumer Reports analysis found “owning an electric vehicle will save the typical driver $6,000 to $10,000 over the life of the vehicle, compared to owning a comparable gas-powered vehicle.” That’s taking into account fuel, maintenance and repair costs, as well as purchase price, financing and resale value. And this was before gas prices went through the roof, so savings are likely more significant today. Certain electric vehicles could be eligible for a federal tax credit worth up to $7,500 and many states offer additional incentives. However, Teslas are among those EVs that no longer qualify for the federal tax credit.
Electric motors have fewer moving parts that can fail than their gas-powered engine counterparts. There are no oil changes or new spark plugs needed and regenerative braking means owners won’t need to replace brake pads as often. A report from the U.S. Department of Energy found the maintenance costs per mile for a conventional internal combustible engine vehicle was $.10 and for a battery-electric vehicle was $.06. That could add up to a lot of savings. Plus, if you’re someone who likes to do a little maintenance yourself, Napa Auto Parts writes on its blog that it has hundreds of parts available for Teslas — everything from heater hoses to headlight bulbs.
Any new electric vehicles you buy in the U.S. will have at least a 100,000-mile battery warranty. And Bloomberg answers my big question — how much the battery would cost to replace. Blooomberg reports that currently the average battery cost for a typical EV works out to about $6,300, though the batteries that go into premium models cost more. Dozens of factors will determine the cost of a replacement battery, and Recurrent Auto found a wide range of pricing. A Hyundai Ioniq 5 replacement battery would cost just under $3,000, a Nissan Leaf battery could go up to $9,500 and drivers would spend nearly $16,000 for the battery and labor for a Tesla Model 3.
If your goal is to save money, buying an electric vehicle simply for fuel savings won’t make up for the price you’ll pay to get a new car. But, if you’re already in the market, an EV could be the way to go.