Car companies are seriously into electric vehicles right now. “With GM’s new Ultium battery we’re gonna crush those lugers!” “The new e-tron fleet vehicles are unlike anything you’ve seen before.” [intense music, electricity noises] “It’s time to plug in.” — okay so this one is making EVs very exciting, there’s a person on a white horse, I’m not sure what the horse has to do with it.
.. horsepower! Looking at these ads, you might get the sense that basically everyone is buying EVs. But in reality, only two out of every 100 new cars sold is fully electric.
In some ways that’s not surprising. EVs, like most new technologies, tend to cost more.
But EVs can actually be cheaper than gas cars over their entire lifetimes. To prove it..
. let’s crunch some numbers. Take for example two otherwise identical cars. We have the Hyundai Kona and we have the Hyundai Kona EV. The Hyundai Kona is $20,500 at the dealership the Kona EV is about $17,000 more expensive.
So on its face that does not seem like the best deal. But remember that electricity is cheaper than gas so over the lifetime of these cars the average Kona EV owner will actually save around $11,000 just by avoiding the weekly trip to 7-eleven. [Stranger Things] “you are gonna pay for those?” [Hopper belch] Then there’s maintenance. Electric cars have fewer moving parts, they don’t need oil changes, and they have regenerative braking, which cuts down on wear and tear.
That accounts for another $4,600 in savings over the lifetime of the car. And then we have something called the federal EV tax credit. So anytime that you buy a new EV from particular manufacturers the government will give you up to $7,500 off on your next federal income tax bill. So it looks like once we take all these benefits into account the Kona EV is actually cheaper than the gas version. Well, it is and it also kind of isn’t.
It turns out, that like health insurance or buying a new washing machine, buying an electric car only saves you money if you can afford it in the first place. Those reduced maintenance costs and fuel savings only come in if you can actually afford to pay the price up front.
And remember, that magical $7,500 tax credit that’s not free money. It’s more like a one-time coupon from the IRS. To get the full amount back you actually have to owe $7,500 in taxes, which means that you have to be making at least $66,000 a year and not have any other major tax credits that you wanna claim.
You also have to be willing to wait until the following April to actually get your money back. In fact, the beloved math nerds over at the Congressional Research Service have calculated that 80% of the people getting the tax credit make over a $100,000 a year. In other words, our nation’s number one primary program to get people to buy EVs is out of reach for basically half of Americans. And keep in mind most Americans buy used cars and right now there’s no tax credit for buying a used EV — unless you live in Oregon which is..
. Oregon. And even if you’re able to get your hands on an EV there’s the challenge of charging.
It’s harder to plug in your car at home if you live in an apartment or a shared house. [Shannon at home] here is the outlet.
.. oh my god i’m tripping on things…
through this fence… up the stairs into a socket box..
. and then it connects to my car. According to some numbers crunched by our very own data journalist Clayton Aldern the more expensive your neighborhood in the U.S. is the more likely it is to have a whole bunch of charging stations.
The good news is electric cars are going to get cheaper to manufacture as battery costs fall, but we want drivers to transition away from gas cars much much faster. One way to do that is to revisit that annoying EV tax credit. You already can’t get the tax credit for Tesla or GM cars anymore and lawmakers say that it’s time to reimagine it. Two members of Congress have introduced a bill that would apply the $7,500 credit right at the dealership which would slash the sticker price of EVs for all prospective buyers regardless of what your income is. Another idea is to build more charging infrastructure especially in neighborhoods where people might have a hard time plugging in their cars at home — there’s actually a line that Biden has said for basically the past year that’s about exactly this — we’re going to invest in 500,000 — 500,000 — 500,000 charging stations.
If those charging stations actually start being built that would make new and used EVs more attractive. If we want to avoid burning up the planet we’re gonna have to switch our gas cars for electric cars and public transit and to do that we’re going to have to make sure that these options are affordable and accessible to everyone — to everyone — everyone. I’m Shannon Osaka, I’m a reporter for Grist and I mostly focus on federal policy and climate solutions although lately i’ve gotten pretty interested in EVs. If you have any questions for me or you want me to look into something for my next article or video drop it in the comments below.