Americans want to switch to electric vehicles (EVs) but remain concerned about the high price tag.
- More than 50% of Americans say affordability is their main concern for EVs, and 70% say they expect to pay less than $50,000 for their next car, according to a Deloitte study.
- The average price of an electric vehicle in the U.S. for August 2022 was $66,000, according to Kelley Blue Book, which is $16,000 above what 70% of Americans are looking to pay.
- According to Kelley Blue Book, the average price for a new gas-powered car in the U.S. for 2022 was high due to inflation but still considerably lower than EVs, sitting at $48,681.
Why it’s news
Many Americans want to switch from gas-powered cars to EVs but are being held back by the high price of the vehicles.
More than 50% of Americans say affordability is their primary concern for EVs, and 70% say they expect to pay less than $50,000, which is difficult considering the average EV price for 2022 sat at $66,000.
EVs are still relatively new and high-tech, making the price tag higher than the traditional gas-powered cars. President Joe Biden signed the Inflation Reduction Act, which is bringing tax incentives to EVs as well as boosting U.S. production, which will lower the price of the vehicles.
The Inflation Reduction Act is putting a $7,500 tax credit on EVs, but there are certain limitations. The vehicles must be a specific price to be eligible for the credit as well as be mainly produced in the U.S.
By making a rule that the vehicles must be mainly produced in the U.S., car companies are making factories to create the parts internally so that the vehicles will be eligible for the credit which will lower EV prices since parts will no longer have to be shipped overseas.
Once production starts in the U.S., it should soon lower EV prices, allowing more U.S. citizens to afford the vehicles.