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Want to buy a new car in 2024? It’s OK if you don’t want to buy an EV. Here’s how to find a good deal and save money on gas (and car insurance). [[{“value”:”
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Electric vehicles (EVs) have received a lot of media attention in the past few years. If you care deeply about fighting climate change, buying an EV might be on your to-do list. And silent, rapidly-accelerating EVs tend to get rave reviews as being fun to drive.
But EVs are not for everyone. Some people have big concerns about the high cost of EVs, the price of EV car insurance, and “range anxiety” about just how hard it can be to charge an EV at home or at public charging stations.
Let’s look at a few reasons why you might not be ready to buy an EV — and what car to buy instead.
EVs help with climate change, but can hurt your bank account
EVs can help fight climate change, but they’re also (still) significantly more expensive than gas-powered cars. Research from Cox Automotive and Kelley Blue Book shows that as of April 2024, the average sale price of an electric vehicle was $55,242 vs. $44,989 for a gas-powered vehicle. That’s a difference of $10,253, making EVs 22.8% more expensive on average!
Yes, there are EV tax credits of up to $7,500 for new EVs, and up to $4,000 for used EVs. But you have to find the right vehicle and have qualifying income. Cost savings on gasoline and maintenance can eventually make up for the higher sale price of EVs, but it doesn’t happen overnight. EVs are not a must-have purchase for every driver. It’s understandable if you have sticker shock about EV prices.
EV charging: Not easy for every car owner
Many people are curious about EVs, but don’t have a reliable way to charge EVs at home. If you have a long commute or regularly drive through rural areas, you might rightfully worry about running out of battery. Although a nationwide effort is underway to build more EV charging stations and other EV infrastructure, some people feel like they’re being pressured to buy cars that cause “range anxiety” in a way that no gas-powered car ever could.
After all, gas stations are available in every neighborhood and nearly every interstate highway exit. How soon will we be able to say the same for EV fast-charging stations?
EV car insurance: Another painful price hike for consumers
Americans are feeling burned out on high inflation. Car insurance has been one of the highest-inflating monthly bills that most Americans have to pay — according to Bloomberg, in the past four years since January 2020, average car insurance premiums have increased by 43.7%.
Does buying an electric vehicle make your car insurance cheaper? Unfortunately, no! EVs tend to be more expensive than regular cars, because EV batteries and other parts are hard to fix or expensive to replace in case of a crash. That makes EV car insurance cost more — around 7%-11% more than auto insurance for gas-powered cars.
If you’re already worried about range anxiety and the cost of your monthly EV auto loan payment, being asked to pay an extra 11% for car insurance might be the last straw.
What to buy instead of an EV
If you’re not ready for an EV, that’s OK. Buying a hybrid vehicle can help you get significantly better gas mileage than a typical car, but without the EV range anxiety. The Motley Fool’s Ascent’s research found that five popular models of hybrid cars can save an average of $611 per year on gas compared to standard gas-powered vehicles.
Some hybrid vehicles, called plug-in hybrid electric vehicles (PHEVs), give you the best of both worlds: the reassurance of old-fashioned gasoline, and the exhilaration of futuristic battery power. These PHEVs combine a gas-powered engine with an electric battery that you can charge by plugging it into a standard household outlet. I own a PHEV — a Toyota Prius Prime — and it’s my favorite car of all time. Cheap to fuel, cheap to insure, and fun to drive!
Some PHEVs can even qualify for EV tax credits. If you choose the right vehicle, your PHEV can get EV tax credits at the dealership for up to $4,000 (for many pre-owned makes and models) or $7,500 (for a limited selection of eligible new cars).
Bottom line
Don’t feel bad if you’re feeling horrified by the costs and uncertainties of buying an electric vehicle. If you don’t have an easy way to plug in an EV to charge at home, if you’re worried about EV range anxiety, or if you want to find cheaper car insurance, buying an EV in 2024 might not be realistic for you. Consider a hybrid vehicle or PHEV for your next car purchase — especially if that PHEV qualifies for EV tax credits.
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