Electric vehicles (EVs) have transitioned from futuristic concepts to mainstream options in the automotive market. If you’re considering a new vehicle, you’ll likely find a greater variety of electric options compared to previous years. Opting for a plug-in hybrid or fully electric vehicle instead of a traditional gasoline-powered car can offer significant benefits, both for your finances and the environment. Bankrate’s insurance editorial team has compiled an in-depth analysis of the advantages of electric cars to assist you in determining whether embracing eco-friendly driving aligns with your needs and preferences.
How do electric cars work?
Conventional vehicles typically employ internal combustion engines fueled by gasoline to propel and function efficiently. In contrast, electric vehicles (EVs) utilize electric energy stored in battery packs housed within the vehicle. These battery packs serve as the primary power source for the electric motor. Charging an electric vehicle’s battery packs can be done by connecting to a standard outlet at home or using a charging station while on the go.
It’s important to note that not all electric vehicles operate in the same manner. Battery electric vehicles (EVs), commonly known as electric cars, derive their energy exclusively from charging battery packs. On the other hand, hybrid electric vehicles (HEVs) combine the use of a battery pack (requiring electric charging) with an internal combustion engine fueled by gasoline. Unlike electric vehicles, HEVs do not require plugging in to charge. If you prefer a hybrid model that can be charged via a plug, you would need to opt for a plug-in hybrid vehicle (PHEV).
Electric vs. gas vehicle costs
The affordability of electric vehicles has notably improved in recent years. According to Kelley Blue Book data from May 2024, the average cost of an electric vehicle stands at $55,242. This marks a significant 9 percent reduction from the first quarter of 2023 to the first quarter of 2024. To provide context, the average price of a new vehicle, regardless of whether it runs on gasoline or electricity, was $48,510 as of April 2024.
In contrast to previous trends of rising prices across all new vehicles, including electric and gasoline-powered ones, there was a slight decline of 0.4 percent in costs from May 2023 to May 2024, as reported by the Bureau of Labor Statistics.
Long-term benefits of owning an electric car
The advantages of purchasing an electric car are multifaceted, with significant savings on gas, maintenance, and insurance expenses being among the most prominent benefits.
Save on gas
According to AAA’s latest data, the average price for regular gasoline stands at $3.57 per gallon, similar to last year’s figures.
Despite the stability in gas prices, fuel costs can still significantly impact your budget. Electric vehicles primarily rely on electricity for power, which tends to have more stable pricing trends compared to gasoline. Although electricity prices rose by nearly 5 percent from May 2023 to May 2024, they generally exhibit more consistency over time.
For a precise estimate of the electricity expenses associated with charging an EV, you can utilize tools like the calculator provided by the Alternative Fuels Data Center. This tool allows you to compare the cost savings of charging versus refueling based on your location and vehicle specifications.
Save on maintenance
Electric cars offer significant savings in maintenance costs compared to traditional gasoline vehicles. Because they have fewer parts and don’t require oil changes, electric car owners generally make fewer visits to the mechanic. According to research from Consumer Reports, owners of electric vehicles can save anywhere from $6,000 to $12,000 in maintenance costs compared to gasoline vehicles. With an electric vehicle, you can say goodbye to the hassle of scheduling tune-ups and oil changes, and you won’t have to worry about the potential breakdowns associated with combustion engines in gasoline-powered vehicles.
Keep insurance rates reasonable
The cost of insuring your electric car depends on various factors, including your personal details and the vehicle itself. Generally, luxury electric vehicles like Teslas tend to have higher insurance rates compared to more affordable options like the Toyota Prius. Historically, insuring electric vehicles has been more expensive than insuring gasoline-powered cars. However, as EVs become more commonplace, insurance providers offer various safety equipment options that can qualify for discounts.
To find affordable insurance for your EV, consider shopping around and requesting quotes from multiple insurers. Explore the EV discounts each provider offers, and remember that many allow you to combine discounts for additional savings. Ensure you’re comparing quotes with the same coverage type and amounts to make an accurate comparison between providers.
Sustainability benefits
Owning an electric vehicle offers substantial benefits for the environment, contributing to sustainability in several ways:
- Zero Tailpipe Emissions: Electric vehicles produce no tailpipe emissions, reducing air pollution and improving overall air quality.
- Better Air Quality: Increased adoption of electric vehicles leads to improved air quality for everyone, as they contribute to reducing harmful pollutants emitted by traditional gasoline-powered vehicles.
- Eco-Friendly Production: Electric vehicle manufacturers often prioritize the use of eco-friendly materials in the production process, further reducing their environmental impact.
- Lower Lifetime Greenhouse Gas Emissions: Despite emissions associated with manufacturing, electric vehicles typically have lower greenhouse gas emissions over their lifetime compared to gasoline-powered vehicles, contributing to mitigating climate change.
- Battery Reuse and Recycling: Advancements in battery technology are enabling greater possibilities for reusing and recycling electric vehicle batteries, promoting more sustainable practices in the industry.
States that offer electric car incentives
Acquiring a new electric vehicle often comes with a hefty price tag, but there’s a silver lining in the form of various federal, state, and local incentives designed to make the transition to electric cars more appealing. These incentives aim to encourage consumers to opt for environmentally friendly alternatives to traditional gas-powered vehicles. While the availability and specifics of these incentives vary depending on your location, here are some common programs you might benefit from:
- Federal Tax Credits: The U.S. government offers a federal tax credit of up to $7,500 for qualifying electric vehicle purchases made before 2022. However, note that this credit is subject to phase-out for certain vehicle brands like Tesla, Toyota, General Motors, and Ford. To check if your vehicle qualifies, consult the IRS guidelines.
- State-Level Incentives: Nearly all states, along with the District of Columbia, offer some form of incentive for purchasing an electric vehicle. Additionally, many cities have their own local incentive programs. Examples include initiatives in San Francisco, California, and Buffalo, New York, among others.
- Utility Company Incentives: Some utility companies provide incentives specifically tailored for electric vehicle owners. Be sure to check with your utility provider to see if your vehicle qualifies for any available incentives.
- HOV Lane Access: Certain cities, such as San Jose, California, and Atlanta, Georgia, grant access to High Occupancy Vehicle (HOV) lanes for electric vehicle drivers. This perk allows EV owners to bypass traffic congestion typically reserved for vehicles with multiple occupants.
- Toll Reduction Incentives: In select states, electric vehicle drivers may benefit from toll reduction incentives, making it more cost-effective to use toll roads and bridges.
Charging stations in the U.S.
The U.S. federal government has committed to expanding the nationwide network of charging stations for electric vehicles (EVs). As the number of charging stations grows, EV owners can enjoy greater peace of mind knowing they have convenient access to charging facilities while traveling. To locate charging stations near you, you can access an up-to-date list through the Alternative Fuels Data Center.
Top 10 states for EV charging stations
| State | EV charging stations | |
|---|---|---|
| 1 | California | 15,957 |
| 2 | New York | 3,964 |
| 3 | Florida | 3,470 |
| 4 | Texas | 3,211 |
| 5 | Massachusetts | 3,065 |
| 6 | Washington | 2,168 |
| 7 | Colorado | 2,151 |
| 8 | Georgia | 1,914 |
| 9 | Pennsylvania | 1,773 |
| 10 | Maryland | 1,674 |
Tips for buying an electric car
If you’re considering purchasing an electric car, there are steps you can take beforehand to make the ownership experience smoother:
- Check charging station availability: Use the interactive map provided by the Alternative Fuels Data Center to locate nearby charging stations at your home, workplace, and along your usual travel routes.
- Explore EV incentives: Research federal and state incentives for electric vehicles using resources like the Alternative Fuels Data Center database. Additionally, inquire with your local utility company about any available incentives.
- Consider operating range: Assess the operating range of potential EV models to ensure it meets your daily commuting and travel needs.
- Optimize home charging: Upgrade your home outlet to a 240-volt level 2 charger for faster charging times. A certified electrician can install this outlet, reducing charging time from up to 24 hours to around four hours.
- Review maintenance requirements: While electric vehicles generally require less maintenance, familiarize yourself with potential maintenance needs and availability of repair shops for EVs in your area. Choose a model with minimal maintenance requirements to streamline ownership.
Best electric cars
Several electric car models are currently available on the market, with the following being among the top-selling models in the U.S. based on 2023 car sales:
Tesla Model Y: This compact SUV comes in three trims: All Wheel Drive, Long Range, and Performance. The 2024 Long Range model can travel up to 310 miles on a single charge, with a starting MSRP of $48,990. The Performance series, while capable of higher speeds, offers a slightly shorter driving range, starting at $52,490.
Tesla Model 3: As Tesla’s entry-level option, the Model 3 is a compact luxury sedan available in two trim levels. Depending on the trim, it can achieve a range of up to 341 miles on a charge, with a base MSRP starting at $38,990.
Chevrolet Bolt: Although discontinued, the Chevrolet Bolt remains available for drivers seeking 2023 and earlier models. Priced at $27,800 for the base compact SUV, it offers a range of 247 miles.
Rivian R1T and R1S: Rivian, a new American EV manufacturer, offers the R1T pickup truck and R1S luxury SUV. Both models start in the mid-$70,000s and boast impressive ranges, with the R1T ranging from 328 to 410 miles depending on configuration.
Ford Mustang Mach-E: This compact SUV from Ford delivers quick performance with 346 horsepower and a range of up to 250 miles on a charge. The 2024 model starts at $39,995.