The Current Cost of Car Ownership: Is It Time to Switch to an Electric Vehicle?

For the past year, drivers have had to check their phones (or drive to their local gas stations) every day to find out if gas prices are going up or down. While gas prices have fallen since hitting insane numbers this summer, filling up your car at the pump can still result in sticker shock these days as the national average for gas hovers around $3.66. It’s better than the $5 average we’ve seen this summer, but it’s not great. It’s not just gas; It can be difficult to find parts for cars, or even to purchase a car at a reasonable price, making car ownership an increasingly expensive and difficult task.

As automakers shift their focus to electric vehicles, and thanks to the high cost of gasoline and total ownership for gas-powered cars, some buyers may want to switch to an electric vehicle to save some money. At first glance, electric vehicles appear to be cheaper in the long term than petrol-powered cars due to the cost of electricity and minimal maintenance. If you’re thinking about switching to an electric vehicle, here’s what you need to know about the cost of running a car.


E-cars are super expensive

Pricing remains a major concern with EVs. Forget expensive niche vehicles like the GMC Hummer EV or Rimac Nevera; All-electric versions of regular cars are much more expensive than one would expect. Let’s take the Hyundai Kona as a prime example. The gas-powered car is $23,285 with the mandatory destination fee, while the Kona Electric starts at $35,245. Apart from the electric drive, the two models are similarly equipped. The situation is similar with the Ford F-150 and F-150 Lightning; If you compare similar configurations, the gas model costs $43,185 and the EV starts at $53,769.

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Looking at the big picture, Kelley Blue Book reports that the median price for a new vehicle in October 2022 was $48,281, while the median price for a new electric vehicle was $64,249. In any case, you pay significantly more money for a comparable electric car.

Pricing aside, some EVs can be hard to buy as availability is limited to a few states. Back to the Kona Electric: The electric SUV is only available in 11 states. If you don’t live in one of these, you’re out of luck or have to go abroad to buy a model.

Mechanic looking at the engine compartment of a car.

There are big differences in maintenance costs

One of the big advantages of switching to an electric vehicle is the lower maintenance costs. With no petrol engine and fewer moving parts, electric vehicles are cheaper to maintain. To get an idea of ​​how much you’ll be spending on maintenance, you can use AAA’s Driving Cost Estimator, which lets you input your state, vehicle, and annual miles driven.

For a quick comparison, we’ll stick with our Kona and Kona Electric. We use California, 15,000 annual miles and 55% city miles. The AAA appraiser puts out a figure of $754 for annual maintenance/repair for the Kona Electric. Estimated service/repair for the gas-powered Kona for a single year is $1,427. Over the course of five years, the Kona Electric will require $3,771 for maintenance/repair, while the regular Kona is estimated to cost $7,138.

The AAA estimator gives a figure of $0.70 per mile for the gas-powered Kona with a price of $5.75 (the average in California) for regular gasoline. It is estimated that the Kona Electric costs $0.72 per mile, with an electricity cost of $0.272. It’s important to note that the per-mile figures also include fuel, maintenance/repair, depreciation, insurance, fees and taxes, and financing costs in the state of California.

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Man connecting a charger to a blue 2022 Porsche Taycan.

Charging vs Gas

The cost of electricity to charge an electric vehicle is difficult to determine. There are so many variables to consider – where you live, what type of car you have, what type of charger you use and what type of on-board charger you have on your EV – that it’s pointless to give a broad price for EV charging. Nevertheless we will do our best. Just remember that your situation will surely be different.

According to the US Energy Information Administration, the average home charging price in the US was $0.15 per kWh as of early July this year. If you throw in all the numbers — 15,000 miles per year, 120 MPGe combined, and $0.15 per kWh — you get $632 to charge the Kona Electric for a full year. If you use data from the EPA website with our numbers for the gas-powered Kona — $3.66 per gallon, 15,000 miles per year, and 32 mpg combined — you’re looking at spending $1,700 to fill the Kona in one year .

Overall, it looks like an EV would be far cheaper to fill up than a gas-powered car, depending on where you live and what type of charger you use.

Tesla's line of electric vehicles parked in front of charging stations in a parking lot with trees in the background.

Things that are out of your control

The new Inflation Reduction Act (IRA) drastically changes which vehicles are eligible for the federal tax credit. EVs must have a final assembly point in North America, have a certain percentage of critical minerals extracted or processed in the United States or at free trade partners, and a minimum percentage of battery components assembled or manufactured in North America. and they must meet strict budget caps based on body style. Things weren’t that difficult before, but you’ll need to do some homework to see which EVs qualify for the tax credit.

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Quite a few electric car manufacturers, such as Rivian and Tesla, offer direct sales to consumers. While this makes buying an EV easier, it means you’re at the automaker’s mercy when it comes to pricing. We’ve seen massive price swings for both Tesla’s and Rivian’s EVs throughout 2022.

2022 Ford Mustang Mach-e and Mustang in an empty warehouse.

Is one better than the other?

No not true. Currently, most electric vehicles cost too much compared to similarly equipped gas-powered models to be worth the additional cost savings in fuel and maintenance. Additionally, the fact that not all EVs for sale are eligible for the $7,500 tax credit makes things even more disappointing and difficult to understand. You also have to consider the high cost of installing a charger in your home or how frustrating it can be to find a charger. We have to say that direct comparisons between electric vehicles and gas-powered cars are not as easy as they might seem because so many factors go into the comparison.

At present, we firmly believe that for the majority of consumers, a gas-powered vehicle is still the better option. If gas prices hit $6 again and routinely stay there, we may reconsider our decision, but EV purchase prices need to come down as well.

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