Are electric cars worth the price?

Electric cars are more costly to buy than petrol cars and can depreciate faster. Even for those who want a zero-emission car, it’s reasonable to consider whether it makes sense to buy one now.

The answer may be yes, but there are many factors to consider, many of which depend on your driving habits and how critical it is to you to reduce your environmental impact. And because electric vehicles are a up-to-date technology, there is less certainty than with gasoline-powered vehicles about how the numbers will shape up over time.

Here’s what we know.

Is battery life an issue?

Most electric cars don’t stay on the road that long, so it’s challenging to say definitively how long the batteries will last. Lithium-ion batteries, like those used in virtually all electric vehicles, lose range over time.

But the degradation is very tardy. Tesla’s electric cars and those of other automakers have software that does a good job of protecting the batteries from excessive heat or voltage that can cause damage, especially during charging.

Automakers typically warrant electric vehicle batteries for eight years or 100,000 miles, and most will replace a battery if it loses more than 30 percent of its capacity during the warranty period.

Things to remember: Batteries will work in freezing weather and extreme heat, but their range may be temporarily reduced.

Anecdotally, there are many examples of people driving electric cars for hundreds of thousands of miles. The likelihood of a battery degrading to the point where it needs to be replaced is less than 1 percent for electric vehicles manufactured in 2016 or later, according to data from Recurrent, a company that tracks the used electric vehicle market.

“All indications are that the batteries should last longer than the cars themselves,” said Liz Najman, director of market analysis at Recurrent. “They should certainly last as long as the average gasoline-powered car.”

And because electric vehicle batteries contain valuable metals like lithium and cobalt that can be recycled, even a completely used battery will still be worth something.

What about resale value?

The price of used electric vehicles has fluctuated wildly. In 2022, when electric cars were popular and challenging to find, some models sold for more on the used market than when they were up-to-date. Now, with more than 100 models of electric vehicles available, resale prices for some models have plummeted.

On average, electric vehicles have depreciated by 49 percent over five years, compared with 39 percent for all vehicles, according to iSeeCars.com, an online car sales site. But several one-time factors contributed to the decline, most notably Tesla’s significant price cuts on up-to-date models.

“Why buy a used car when you can buy the same up-to-date one?” said Karl Brauer, executive analyst at iSeeCars.

Hertz helped create a glut in the market when it decided to sell 30,000 of its EV fleet because it was losing money on them. The proliferation of up-to-date EV models from Hyundai, Kia, Ford Motor, General Motors and others has fueled intense competition and driven down prices.

But there are signs that used electric vehicle prices are stabilizing. Newer models with longer-range batteries hold their value quite well, according to John Helveston, an assistant professor at George Washington University who has the market for used electric vehicles was examinedDepreciation rates are “moving toward convergence” with gasoline vehicles, he said, “but we’re not there yet.”

Leasing is one way to avoid the risk of an electric vehicle depreciating in value or becoming archaic by newer technology. When the lease ends, any depreciation is the dealer’s problem.

Or buy a used electric vehicle that has already depreciated in value. By some estimates, used electric vehicles now cost less than used petrol cars. “If you’re interested in an electric vehicle, that’s a great idea,” Mr. Helveston said.

How much can I save on fuel?

People naturally pay attention to sticker prices when shopping for cars. The average price of a up-to-date electric car or pickup truck was $56,371 in June, according to Cox Automotive estimates, compared with $48,644 for all vehicles.

But many people will make up the difference in lower maintenance and fuel costs. The Environmental Protection Agency estimates that charging an electric Ford F-150 Lightning pickup costs $1,100 per year, less than half the annual cost of refueling the most fuel-efficient gas-powered F-150.

Of course, actual savings may vary depending on current gas prices, local electricity rates and driving habits.

Maintenance costs are typically lower because electric vehicles don’t require oil changes and don’t have spark plugs or mufflers that need to be replaced periodically. They have fewer moving parts to break down. However, electric vehicles tend to wear out tires faster because the batteries are so bulky.

How to evaluate the environmental benefits?

Some of the benefits of electric vehicles are challenging to put a dollar value on. Many people will enjoy the peace of mind that comes with driving a vehicle that produces significantly fewer greenhouse gases and other pollutants. (Though those are not without their environmental impact.)

A mid-size electric sedan with a 300-mile range produces half as many greenhouse gases over its life cycle as a comparable gasoline-powered car, according to research. A study published in November by Argonne National Laboratory taking into account emissions from mining, processing industry and electricity generation.

Electric vehicles don’t produce any nitrogen oxides or other pollutants that cause asthma and other respiratory problems. And many people like the quick acceleration and quietness of electric vehicles, as well as the convenience of charging at home if you have your own driveway. Whether it’s worth paying a higher price for these benefits is a matter of personal preference.