Renting an electric vehicle (EV) is now the cheapest option for new car buyers in the U. S. U. S. dollars: thousands of dollars less consistently over the year than buying or leasing a gas-powered vehicle.
This new economic dynamic is driven by several factors: lower electric car rental costs, new federal tax incentives from the Inflation Reduction Act (IRA), lower operating and maintenance costs from electric cars to gasoline cars, and emerging interest rates.
Fossil fuels are to blame for up to 40% of recent inflation, and oil market volatility has made pump pain a recurring headache for American families since the mid-1970s. For American drivers who want to save maximum money and get off the fossil fuel roller coaster. Fuels, the choice is clear: rent an electric vehicle.
New energy innovation studies learned about this trend by analyzing the purchase and lease prices of 14 models of electric and gasoline vehicles in the 50 states. Studies included financing and leasing pricing, state taxes and fees, state and federal tax rebates and credits, fuel. Insurance prices and prices.
Renting an electric vehicle is the cheapest monthly option American drivers can have, less expensive than renting a comparable gasoline vehicle or buying an electric vehicle or a comparable gasoline vehicle. Rents are paid per month, with little to no down payment. Which means new car buyers can start saving money the day their car leaves the parking lot.
And the savings from renting an electric vehicle can add up quickly. The Ford Mach-E, for example, costs $500 less per month and nearly $7,500 less per year than a comparable gasoline-powered vehicle. And the Tesla Model Y, which has been the best-selling electric vehicle in America since its introduction, costs $425 less per month, or more than $5,000 less per year, than its gasoline equivalent.
As electric cars become increasingly popular with American drivers, automakers have poured billions into the production of electric vehicles and new models, spurring the festival among electric vehicle dealers and expanding EV inventories.
These new incentives for brokers and the expansion of supply, along with IRA incentives, reduced the average value of electric vehicle transactions last month by 20% compared to the same period last year, even though transaction values between all cars increased by 1. 6% compared to the same constant period. Savings on electric vehicles will accelerate when oil prices rise back to 2022 levels, about 40 cents a gallon higher than today.
This charging dynamic is not limited to the lease of an electric vehicle: it also manifests itself in the case of new electric vehicles financed for purchase, even compared to gasoline cars financed for purchase. It is vital that nearly 80% of Americans finance their new cars, compared to 18-19% who rent cars and only 1-2% who buy new cars outright.
Wise electric vehicle policy has accelerated this trend. Last year, the IRA gave new $7,500 tax credits for leased electric cars, and when dealers pass it on to new car buyers, they reduce lease bills and increase drivers’ savings.
Electric cars are already competitive with gas-powered cars, even without the federal incentive, yet the IRA’s Electric Vehicle Tax Credit makes monthly rental costs 12% less expensive on average when dealers pass them on to renters, making nearly all EV models cheaper. more expensive to lease than gasoline-powered cars.
Salesman showing a new electric car to a multiracial couple in the showroom. Female sales manager holding an electric car charger and explaining the operation of the electric car to the buyer couple at the dealership.
Additional federal and state policy measures may give the green light to even more electric vehicle sales. California’s Advanced Clean Cars II regulation, which sets ambitious zero-emission vehicle sales criteria at the state level and can be enforced in the 16 “Section 177” states that have followed California’s old blank car criteria, could be combined with the IRA’s incentive for electric cars to make up 66 percent of the U. S. auto market. In the U. S. until 2035.
New proposals from the U. S. Environmental Protection AgencyU. S. legislation over tailpipe pollutants could further fuel that transition, with electric vehicles accounting for 67% of national light-duty vehicle sales through 2032, the final year of the IRA EV tax credit.
Billions in federal incentives from the Infrastructure Investment and Jobs Act are building electric vehicle charging stations across the country, and those dollars are being leveraged in nearly every state as the Biden administration aims to build a nationwide network of 500,000 electric vehicle chargers through 2030.
Corporate moves may also expand charging options: Tesla, which has the nation’s largest electric vehicle charging network, will open at least 7,500 of its chargers to non-Tesla drivers by the end of 2024.
Actions like those may leave autonomy anxiety in the rearview mirror and inspire more drivers in more parts of the country to opt for an electric vehicle for their next vehicle.
Easy access to electric vehicle charging then becomes a gateway to consumer savings. Recent models show that each and every style of electric vehicle in each and every state is less expensive to qualify for than filling up a gasoline vehicle, even though fuel costs are at their lowest recent levels.
A Ford F-150 Lightning costs $1,350 less per year to refuel than a gasoline-powered Ford F-150
Washington state has the biggest price difference: An average electric sedan costs $60 less to refuel, and an average electric truck costs about $82 less to refuel than comparable gasoline-powered vehicles. Even in Hawaii, where the price difference is smaller, the average price of an EV sedan is $27 less to refuel and an average EV truck costs $25 less to refuel than comparable gasoline-powered vehicles.
U. S. Electric Vehicle Saleshave grown since 2018, from more than 360,000 vehicles, or 2% of sales that year, to more than 810,000 vehicles, or 6% of sales in 2022. Every electric vehicle sold vaccinates some other American family that opposes the volatility of the value of oil and inflation at the pump thanks to fossil fuels.
Smart policy has opened up new avenues for consumers to save cash with electric vehicles. Despite emerging interest rates and falling fuel prices, renting an electric vehicle is now the cheapest way for American drivers to get a new car and start saving money. In their electric vehicle ambitions, federal and state policymakers can ensure that consumers face no barriers to fighting inflation and reducing air pollution.