Electric vehicles (EVs) are considered the future of eco-friendly transportation. However, beneath the green image lie hidden costs that are often overlooked. This article aims to unveil these costs and provide a complete picture of EV ownership.
Higher Purchase Price
Electric vehicles typically cost more than their gas-powered counterparts. For example, the gas-powered Hyundai Kona crossover has a starting price of $21,300, while the electric version of the same car starts at $34,050. Even though the price gap is decreasing, the higher initial cost remains a hurdle for several buyers.
Additional Registration Fee
Electric vehicles don’t contribute to gas taxes, which fund road repairs. This has led some states to apply additional registration fees to EVs. These fees, ranging from $50 to $200, are required in at least 32 states in the US, with some states also assessing a fee for plug-in hybrid vehicles. These fees are an additional cost to consider when purchasing an EV.
Tax Credits Don’t Apply to Most Vehicles Now
The Inflation Reduction Act, signed by President Biden in 2022, has tightened the criteria for the $7,500 EV tax credit. The electric vehicle (EV) must be made in North America to be eligible. By 2024, it shouldn’t have battery parts from certain foreign countries, including China. And by 2025, the EVs can’t contain any raw materials mined in those countries. Only 21 out of 72 EVs currently on sale qualify, excluding popular brands like Tesla, Porsche, Kia, Mazda, and the new Toyota bZ4X.
Home Charging Infrastructure
Charging an electric vehicle (EV) at home, while cost-effective, increases the electricity bill and can require lengthy charging times with a standard Level 1 charger (120-volt wall outlet). To reduce charging time, many EV owners opt for a Level 2 charger, which, including installation, costs around $2,500 and has a lifespan of about ten years.
Public Charging Facilities Are Expensive
Public charging for electric vehicles can be more expensive than home charging. Companies like Blue Dot charge a flat fee of $0.30 per kWh, which can amount to around $30 for 300 miles of range. This is cheaper than the average cost of gas, which is around $51 to fill a 13-gallon tank, but more expensive than home charging. Other factors like the type of charger used, location of the charging station, and time of day can cause the costs to vary, making public charging an unpredictable expense.
Higher Insurance Premiums
EVs are approximately 5% to 20% more expensive to insure, as they are costlier to repair and replace, and fewer repair shops have the necessary training and tools to service them.
For instance, the Tesla Model Y and Model S have higher average annual insurance costs than their BMW counterparts, the X3 and 7 Series, respectively.
Battery Replacement Cost
Electric vehicle (EV) batteries are expensive to replace, with costs ranging from $10,000 to $20,000. These batteries are typically warranted for eight years or 100,000 miles, but replacement costs outside of the warranty period can be significant. The average battery replacement cost on a Chevrolet Volt is $3000 to $8000, and the Volkswagen e-Golf Tesla is $23,442.
The high cost of battery replacement contributes to the depreciation of EVs and is a critical factor in the total cost of ownership. However, advancements in battery technology, such as the development of solid-state batteries, may help reduce these costs in the future.
Depreciation is another hidden cost of owning an electric vehicle (EV). Studies indicate that EVs can depreciate twice as much as conventional cars. This depreciation is influenced by factors such as the $7,500 tax credit on new EVs, which can cause a car’s value to drop significantly once voided, and the fact that EVs can lose up to 20% of their range after five years. The constant advancements in EV technology and the introduction of new models could also impact the resale value of existing EVs.
Range Loss Over Time
Over time, electric vehicle batteries degrade, leading to a decrease in range as the vehicle ages. This effect is exacerbated by cold weather, which can reduce an EV’s range by up to 12%. Different models respond differently to cold; some retain most of their range, while others lose over 30%.
While cold temperatures don’t permanently degrade EV batteries, the natural passage of time does, leading to an annual degradation of around 2 to 5%. These factors contribute to the hidden costs of EV ownership, as they can lead to more frequent charging, battery replacement, and other maintenance issues.
Higher Repair Costs
Electric vehicles (EVs) can incur higher repair costs due to the high cost of parts, labor, and time required to find the problem. The scarcity of specialized EV mechanics and the complexity of EV electronic systems can increase these costs.
As EVs become more common, the availability of qualified mechanics is expected to rise, potentially reducing these costs. However, until then, EV owners may face a premium for vehicle upkeep.
Additional Costs For Advanced Features
Electric vehicles have advanced features that enhance driving comfort and efficiency, but some of these features come at an additional cost. For instance, activating advanced driver assistance systems (ADAS) or autonomous driving capabilities can cost over $10,000.
Similarly, new EVs, like Tesla, offer optional add-ons such as a self-driving option for an additional $15,000 and an acceleration boost feature for around $2,000.
If you use your car a lot, like for work, charging can take up a lot of time. If you can’t charge your car overnight and need to do it during the day, it can take away from your work time. So, charging your vehicle can make you less productive.
EV Tires Wear Out Faster
Electric vehicles are heavier than regular vehicles because of their heavy battery packs. This additional weight increases the strain on the tires, which makes them wear out more quickly.
Furthermore, the power and instant torque of electric motors can lead to faster tire wear, especially if the accelerator is frequently used to its full extent. Thus, frequent acceleration in an EV can result in a substantial and immediate load on the tires, accelerating their wear.