I typically get one to two queries a month from friends, family, and acquaintances about purchasing an EV. The vast majority of them asking “which car should I buy?” is about gas and hybrid. The person already has a car in mind and, really, they just want me to say, “that’s a good choice.”
Then gas prices spiked. Then they spiked again. Yesterday, I paid over $6 a gallon for gas. So it’s no wonder that multiple times a day I’m asked, “which EV should I buy?” Unfortunately, while I’m happy that more people are coming around to electric cars, in addition to being the worst time to fill up your car in decades, it’s also the worst time to buy a car. Any car.
So here are some tips that might help you navigate this madness.
What You’re Driving Now
I’m not here to judge your past purchases and current vehicles. That’s for your bank account to sort out. But if your daily vehicle is something that gets less than 20 miles per gallon, this is probably a tough time for that balance. But just because you drive a full-size truck that’s lifted and has wheels the size of Miatas on it doesn’t mean you need to run off to buy an EV right away. You need to do some calculations.
First, how many miles do you drive a day? If you’re driving less than 20 miles a day on average, you might be able to get away with just paying for really expensive gas for another year or so. The EPA fuel economy site will tell you how many kW and gallons of gas a car will use to travel 100 miles. Find out how much a gallon of gas is and the price per kW your local utility charges during off-peak hours to figure out how much money you’ll be saving.
I recently figured out that driving my 2014 Subaru BRZ 100 miles cost $18, while driving my 2022 Hyundai Kona electric 100 miles cost $6. That’s when gas was $5 a gallon. Again, I paid over $6 for gas yesterday.
Second, EVs are still expensive. If you’ve paid off your car and it’s running fine, selling it for a new EV that will introduce a monthly payment into your budget might not be the best plan.
But even if the economics make sense, it’s not going to be easy to make the switch.
The Problem
It would be great to tell people to head on down to their local dealership, trade in their gas guzzler, and drive home in an EV. But that’s not how things work right now.
Supply chain issues have severely diminished vehicle production, and on the dealer side, the available inventory. So, to counter the lack of vehicles in their showrooms, dealerships are hiking up the prices of vehicles by thousands of dollars. I’ve personally seen a $30,000 car with a markup of $15,000. That’s $45,000 for a $30,000 vehicle. It’s the supply and demand. There’s very little supply and the demand is very high. Right now, that’s the situation with EVs.
Ordering an EV from an automaker isn’t any better. If you’re able to negotiate a price that’s not riddled with insane markups, it’ll be months before your vehicle shows up. Automakers are building vehicles as fast as they can, but the supply chain bottlenecks are making it difficult to deliver vehicles to customers.
… in addition to being the worst time to fill up your car in decades, it’s also the worst time to buy a car.
The Solution (Sort of)
There is no one size fits all solution for this situation, but here are a few tips.
To start, buy from available inventory. If you’re in a hurry to move away from gas, be aware that ordering a car will likely take months or maybe even a year before it’s delivered. If you’re a patient person, cool. If not, and your current vehicle is burning through your savings, look at the available stock.
You should also check out EVs that have been around for a while. The Hyundai Kona Electric, Nissan Leaf, Kia Niro EV, and Chevy Bolt have been around for years and likely won’t have absurd markups. These all have solid range numbers and, in a pinch, can appease your desire to save money while driving. The newest and shiniest EVs might be spectacular, but they’re also in high demand, and that likely means huge markups.
To save a bit of money, find a dealership with a history of only charging MSRP or only adding a small markup. Talk to friends about where they bought their vehicles and see what the experience was like. While some of these price increases seem borderline criminal, dealerships need to make money, too. It’s the gouging that’s the problem.
And if you’re shopping online, make sure you get the price of the vehicle before you head to the dealership. When we were shopping for our Kona, a few dealerships just refused to share the price of their vehicles. My time is valuable, and so is yours. If they can’t bring themselves to give you the price of the car before you show up on their lot, then there’s a good chance there’s going to be some sticker shock.
By the way, don’t forget to check out plug-in hybrids, too. They typically have an EV range of 20 miles or more before the gas engine kicks in. It’s the best of both worlds. If you’re looking to replace your only vehicle and need to travel long distances on a regular basis, a plug-in hybrid might be a good replacement and a nice step towards going full EVs.
Lastly, if you like an EV that might be your ticket to a world without gas stations, drive it. You can either buy or do what I did and lease. Just find a place that’s worthy of your business.
Le Sigh
The reality is that this is the worst time to buy a vehicle, any vehicle. At any other time, the switch to EVs would likely be pretty painless. You’d swap one payment for another and reap the benefits of tax credits, lower fuel costs, and reduced maintenance.
Instead, supply chain issues and chip shortages have made building vehicles more difficult, resulting in higher prices and longer wait times. If you can hold off for a year, do it. But if you’re spending more money on gas than you feel comfortable with, and it makes financial sense, then by all means, take the plunge. Just be prepared.
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