Owning an electric car is cheaper in New Jersey than in California

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(Bloomberg) – What to buy cheap, a petrol car or an electric one? The answer may surprise you.

Whether new or used, gas-powered or pure plug-in, the manufacturer’s proposed retail price (MSRP) on all vehicles in the United States has caused some serious sticker shocks in recent months.

In April, according to Cox Automotive, the average new car list price was over $ 45,000, a number that reached the first of September (and the all-time high at that time).

Prices reflect lower inventory across the United States, which is due to the continued disruption of the supply chain. The total supply of unsold new vehicles available at the end of April stood at 1.13 million units, Cox reported, compared to 1.10 million units in March. This is about 800,000 fewer vehicles than in the same period in 2021; And 2.2 million less than in 2020.

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So yes, the number of all types of vehicles in US dealerships is low, which raises the price of stickers on those vehicles. However, this does not automatically mean that a new electric car will cost you more.

According to a recent report by Energy Innovation Policy and Technology LLC, a climate policy think tank, in many states, across several models, buying an electric car is cheaper than conventional gas cars. The report focuses on the conditions surrounding the purchase and financing of the EV and what the monthly costs will be.

“What the average consumer sees? Our research mostly focuses on that question – how do people buy cars, how do they finance them,” said Robbie Orvis, lead researcher and author of the study. You don’t want to spend too much. “

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About 85% of car buyers in the United States purchase finance vehicles. According to the report, the main reasons for these buyers are “how much they have to pay each month to own and operate a car, how much a vehicle will necessarily save for a lifetime.”

In most U.S. states, the results of the report suggest that an electric car may be cheaper on a monthly basis than a comparable gasoline car. Orvis’ analysis found: the cost of financing; State taxes and fees; State and federal rebates and tax credits, in particular 7500 federal tax credit; Fuel consumption; Maintenance costs; And insurance costs.

In addition to the related gas versions, six EV models were studied: Volvo XC40 ($ 56,395 MSRP), Nissan Leaf ($ 28,425 MSRP; compared to Nissan Versus), Kia Niro EV EX Premium ($ 45,865 MSRP), Hyundai Kona Limited ($ 45,47) Kona SEL (35,245 MSRP) and Ford F-150 Lightning ($ 41,669). The goal, Orvis said, was to find a fairly representative team of classes of different sizes; And, as much as they can, “really to compare apples with apples.” (The top 5 states with the lowest costs for three of the six models studied are shown in the chart above.)

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According to Energy Innovation’s analysis, the electric versions of the Kona SEL and F-150 are cheaper to own in every state across the country. “I’m amazed at how economical some vehicles are,” Orvis said. “Given the fact that two models, including the F-150, were cheaper in each single state, I didn’t expect to see it.”

Nonetheless, Orvis warns that “the big picture numbers do not reflect how people pay for their vehicles. When you finance a car, it is much more manageable.”

Matt Hyken, owner and dealer principal at Prestige Collection Auto Group in North New Jersey, says EV prices and financing options are more competitive at the moment due to a shortage of supplies and low inventory in traditional gas vehicles. “It’s making the Delta even more so between EVs and internal combustion engine vehicles,” Hyken said. His group consists of four dealerships (two Volvos; one Lincoln; one Polyester). “Also, there were discounts on cars before, which is virtually gone now,” he added – another factor that makes gas cars more expensive.

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This is even more true when it comes to sales at a Hyacinth dealership in New Jersey. “It’s the number one state in the country to own an EV,” Orvis said The state offers a $ 5,000 charge-up New Jersey discount when you buy or lease a car; Also, there is no purchase tax on EV. Then, combined with other offers and federal subsidies and breaks, “these are really good incentives.”

Georgia tops the list, according to a study by Orvis, among the least-favorable states for EV purchases, with the highest annual taxes on EVs and no state rebates. And an amazing finding: California offers many EV incentives but they are offset by the high cost of electricity.

Hyken, who says he started buying EVs from across the country in 2016 and 2017 for his dealership, believes the United States is close to a tipping point. He is confident that EVs will start to reduce costs so that cars are more affordable to a wide range of people.

“Now night and day are different,” he said. “Everyone wants electricity. This is a very diverse group. Those who do not decide to buy EV now will make a comment, ‘This is my last ICE [internal combustion engine] Vehicles. ‘

© 2022 Bloomberg LP




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