Axios: Electric Cars Are Rather Expensive And Playthings For The Rich, You Know

For all the commercials you see touting this electric car and that electric car that is out or coming out, all of them are expensive and not meant for your average citizen, but for someone who has $40k, $50k, $60K, and up to piss away on an EV as their fun car. Because most of them will have a fossil fueled vehicle for actually going somewhere. If you’re taking a long drive, how many Teslas do you see on the highway?

To combat climate change, electric cars have to be cheaper

Most drivers of electric cars are wealthy, and most electric cars are luxury.

Why it matters: To effectively combat climate change, the opposite needs to happen: electric cars need to become affordable and broadly appealing so the masses can and want to buy them. Only with mass adoption will heat-trapping emissions steeply decline in America’s most polluting sector.

The big picture: The stereotype of rich Californians driving their Teslas isn’t a bad thing—at least not yet. It’s part of the cycle of new technology costs. Wealthy drivers are helping drive down the cost of new electric-car technologies by being able and willing (and subsidized by governments) to be early adopters of these vehicles.

They are? Driving to what? From $50k to $49k?

By the numbers: Of the 11 newest battery electric vehicles introduced in the U.S. between 2018 and 2020, eight are luxury vehicles.

  • The average starting price of an electric car has increased over the past eight years, despite battery costs plummeting. The average price in 2012 was about $39,000. Last year, it was $52,000. (The cost of gas-powered cars is generally trending up too.)
  • The average salary of an electric-car owner in California is $174,000, more than double the national average.
  • Teslas, which make up more than 70% of the electric-car market, have even wealthier drivers, with average incomes of more than $300,000, Hardman’s research has found. (Multiple requests for comment to Tesla were not returned.)

There were few options in 2012, mostly the Nissan Leaf. That hasn’t changed all that much, and most are from what we call “high-line” manufacturers. BMW, Lexus, etc. Average folks aren’t going to go for a loan that would be $981 a month for 5 years (based on that $52K number above), and banks aren’t going to extend credit on one to quite a few people. They will say “this is beyond your budget. No.” People aren’t even going for plugin hybrids, why would they go for pure hybrids?

Driving the news: The Biden administration is proposing to invest $174 billion into electric vehicles and related charging equipment, including giving consumers point-of-sale rebates to buy American-made electric vehicles.

  • This is key to attract lower-income buyers. Although the lifetime cost of owning an electric car can be lower than its gasoline counterpart, the sticker price remains higher, dissuading lower-income drivers, Hardman says.

The tax credits, which are mentioned, mean little, as they just reduce a taxpayers liability, not give them actual cash equal to $7,500. Even if they said “we’ll pay the bank $7,500 directly”, you’re still talking over $800 a month, with the banks still denying.

“When you take away the incentives, I just think you could really harm those that are on the fence,” said Eileen Tutt, executive director of the California Electric Transportation Coalition, a group of companies supporting electric cars. “If we eliminate this program now, that could ripple across the U.S. and really harm the market.”

The bottom line: “Let’s be real. We’re not even close to meeting our goals,” Tutt said of California’s aspirations. “We’ve got to get to a new set of consumers.”

Incentives do not matter to those who would still not be able to afford them, and find them to be rather inconvenient for actual life. Some people can afford an Accord or Camry as their first vehicle, maybe an Odyssey or Sienna, and have a motorcycle for fun. An EV is that motorcycle, but, their first car is also really expensive.

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14 Responses to “Axios: Electric Cars Are Rather Expensive And Playthings For The Rich, You Know”

  1. Roy says:

    The Teslas A Car For Asshole that think they are Saving Natural resources. They Forget Fossil fuel produce the electricity to power their stupid electric toys! Good local car for Pizza delivery at a high expense…. Useless for extended travel as charging time defeat the whole purpose of efficiency. So be the next Jackass to piss your money Away

  2. Professor Hale says:

    The key to attracting low income buyers is to give them away for “free”.

    Or they can go full Hitler and demand that car makers produce a “peoples car” that is simple to build, maintain, and operate and has zero frills to keep the cost low. Basically, a free golf cart with windows for everyone. Of course, in cities, not everyone needs their own golf cart. They can just park spares on the sidewalk and let whoever needs one take one.

  3. JG says:

    The battery in these vehicles last for only so many years with draining and not charging fully. The replacement costs for batteries are very expensive and take several weeks to install. They also take long times to charge and if you own one will require house power modification to charge over night. Long distance trips are not something these are good for only urban. I recent VW ID4 electric took 18 days to cross the USA only via the southern route as central and northern had no charging stations.

    • Professor Hale says:

      Not everyone has a crappy garage. Mine is already wired for 220 with outlets to spare. Of course, lots of people who have limited means also don’t even have a garage. For apartment dwellers, even parking in the city is considered a luxury that can cost as much as a car payment all by itself. If apartments have to recoup the cost of installing and powering charging stations, that will go up.

      Nothing is free.

    • Professor Hale says:

      The Tesla page shows plenty of charging stations along most interstate routes, even those in the north. Just don’t pass any of them by in Montana not matter how long the line is. It will be a while before the next one.

  4. Dana says:

    It seems that 20% of plug-in electric car buyers in the Pyrite State have traded them in for gasoline-powered vehicles, because the things are just too damned inconvenient.

    A plug in electric might be a fine second car, but people of modest means can’t afford ‘extra’ cars.

  5. Professor Hale says:

    Where is Hairy to tell us the daily spot price of carbon offsets? Maybe EVs pay for themselves in carbon offsets you can sell to your neighbors.

  6. Hairy says:

    Almost all local electric suppliers low you to specify renewable energy at a small extra cost so no need to worry about carbon offsets
    The average new car cost in the usa for 2020 was 38000 about the same for a tesla model 3
    I was paid to drive a model X from Sesttle to Montauk NY it took 3.5 days
    The tesla model 3 base model goes from 0-60 in 5.5seconds quite fun to drive The model X I drove was twin motor much faster
    I doubt very much any ICE car of equal cost has equal performance
    The tesla 500hp engine is about as big as a slow cooker
    Current tesla batteries last about 500000 miles that is expected to double soon
    EVtechnoligy is improving daily try to stay current

    • Est1950 says:

      You really are ill informed hairy. Moron does you justice for the most part.

      You pretend to speak as if you know the facts when you just make stuff up and in your mind its all good.

      Exxon Mobil Corp.

      Open
      $59.00

      Exxon has been in the Dow Jones Industrial Average since 1928, when it was known as Standard Oil Co. of New Jersey. That’s the longest tenure of any company in the index. HOWEVER HAIRY.

      So the decision announced late on Monday by S&P Dow Jones Indices to remove Exxon from the Dow as part of a larger re-balancing.

      From the Motley Fool which is really a very respected investment company.

      It hasn’t been easy to own energy industry Goliath ExxonMobil Corporation (NYSE:XOM) over the last decade. Despite a 16.5% gain so far in 2019, the stock is only up 17% over the past 10 years.

      What’s wrong with Exxon?
      In many ways it looks like Exxon lost its way under the stewardship of former CEO Rex Tillerson. That shows up very clearly in the company’s production statistics and its return on capital employed metrics. ROCE is basically a measure of how well a company uses its shareholders’ cash.

      IMPORTANT::::::

      The SEC— forced Exxon’s hand on the matter. SEC rules require that oil and gas companies value reserves based on the average price of oil from the previous 12 months.

      Why is that important??

      On February 24, Exxon reported that it would actually remove over 30 percent of its proved reserves from its books — essentially wiping out the value of its Canadian tar sands holdings from its books.

      So hairy I hate to bust your bubble but please stop saying Exxon is losing share value because of electric cars. LOLOLOLOLOL….We all know your a troll here but at least have the personal integrity Like Elwood to at least try to be half right half the time.

  7. Hairy says:

    Early innovators of any new technique are always prone who can afford it
    The first Mac computer cost 2500 equivilant to 6000 now
    That is similar to what is currently happening with EVs
    Every major manufacturer knows that the future is electric
    Thst is one reason why Exxons stock has dropped 50% in 5 years
    You know, that “free market”thing

    • Professor Hale says:

      hairy,
      Your math is as flawed as your logic. A drop in price from $88.51 to $58.85 in 5 years is a 33.5% decrease. But why not look at the more recent rise from October 2020 to present where the price went from $32.62 to $58.85? A 80% increase. By your logic, isn’t the market telling us EVs are DOOOMED?

      In reality, stock prices go up and down all the time and for speculative reasons, not because insiders “know something”. You can bet your farm that if Exxon thought the wave of the future were EVs, they would be getting ready to ride that wave, not getting ready to declare bankruptcy.

      Nor has America had anything like a “free market” anywhere above the local produce stand for over 100 years. In a free market, you would be free to tell a black man he could not eat at your lunch counter.

    • david7134 says:

      John,
      You do realize that electric energy in its present stage is far more polluting than fossil fuels? For that matter the current batteries are just as dangerous and polluting as nuclear material, in fact more so. Your assessment of the fossil fuel industry and the price variations is very, very immature and does not show you to be a deep thinker. As to carbon offsets, that is pure stupidity. So, your whole comment is immature and stupid. Just like you have been doing for years now.

  8. Professor Hale says:

    What the EV market really needs is a way to hot-swap batteries instead of recharging them. The battery banks need to be accessible and in small enough pieces to lift out and swap with fresh ones at a swap bank just like we already do with propane cylinders. The infrastructure “owns” the batteries and takes responsibility for disposing of the ones that are worn out, recharging the good ones, and helping old ladies swap them out. That way no one cares that they are losing their brand new batteries to get a set of year old batteries at the next “fuel ” station. Stop trying to think of electricity as if it is a liquid, including designing the electric plug to look like a gas nozzle. Design the car to have an easily removable plug and play battery. We may get this some day, but right now the early adopters are in the way of better ideas. Investing in bad ideas clouds their judgement.

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