Are Electric Cars Worth It?: Gas vs Electric
For many shoppers, yes, electric cars are worth it. For shoppers interested in leasing, EVs are usually considered a worthwhile choice since you get the benefits and advantages of an electric vehicle, with fewer of the financial downsides.
Generally EVs can be more expensive up front, are more environmentally friendly, cost less to maintain, and suffer from greater depreciation than gas cars.
Compared to traditional gas-powered internal combustion engine cars, electric vehicles are still new to the majority of automotive shoppers. There's a lot of information available to help you decide if the time is right for you to make the switch, but unfortunately, there's also a lot of confusion that lingers. We're here to cut through the noise and give you the facts on gas vs. electric.
Table of Contents
Pros of Electric Cars
Costs: Budgeting is likely the most important factor for EV shoppers, so we'll start there. An electric vehicle will cost more than an equivalent gas-powered car at purchase. Prices are getting closer, but we don't expect EVs to drop below them anytime soon.
You will, however, save money by charging rather than refueling at a gas station. With this in mind, it's a good idea to imagine that along with the EV purchase, you're also buying a big portion of those fuel savings.
How much you'll save over the long run is influenced by a lot of variables. These can include how much electricity costs where you live, how much you drive, and even the weather. Many of these variables apply to gas-powered vehicles, too, by the way.
To simplify things, we'll take data from the U.S. Department of Energy (fueleconomy.gov). According to the EPA, a Tesla Model Y will cost you an average of $650 per year in charging costs. That's based on a 45 percent mix of highway driving with 55 percent in city miles, driving 15,000 miles annually, and with current fuel and energy costs.
By comparison, the EPA estimates the similarly sized Hyundai Kona at $1,550 annually. A comparably equipped Model Y will cost around $45,000 compared to the Kona's $25,000 price tag. With some simple math, you'll save $900 in annual fuel costs with the Tesla, but it will take 22 years to make up the $20,000 price difference.
If we do an apples-to-apples comparison within the Hyundai Kona lineup, the divide is less alarming. The Kona Electric is also estimated at $650 per year in energy costs, but it has an equivalent starting price of $37,000. That chops the break-even price to 13 years.
Space: Another less-advertised EV attribute is interior space. Without the need for a fuel tank, engine, exhaust, and transmission, there's a lot more room. Most EV batteries are located in the floor of the vehicle, allowing designers to maximize passenger and cargo space. Many also offer a front trunk (frunk) where the engine used to be.
Maintenance: EVs also have fewer moving parts than their gas-powered rivals and require less maintenance. Regular oil changes will be a thing of the past, and brake pads will wear considerably slower, too. Manufacturing flaws are just as common as non-EVs, but they're covered with comprehensive warranties. Current federal law requires at least eight years or 100,000 miles of coverage, which exceeds the standard set for internal combustion vehicles.
Incentives: These figures certainly point to gas-powered cars having a financial advantage, but it doesn't tell the full story. The Tesla Model Y is still eligible for a $7,500 federal tax credit, and there may be additional tax incentives from your state or local government. That addresses some of the upfront costs.
There may also be incentives to reduce the cost of operating your EV. Power utilities often have special programs for EV owners that award them with lower energy rates during off-peak hours (at night). Some automakers also include complimentary public charging for new cars. Combined with further rebates for home charging installations, the price gap between gas and electric narrows.
These incentives are susceptible to change and can be influenced by numerous variables. In the last few years, they have gotten more restrictive and may not be applicable to higher-income households. Eligible EVs typically need to be manufactured in the U.S., too. Political ideology has also worked its way into the equation, and these incentives designed to speed up EV adoption may be subject to how leadership views the industry. Case in point: the federal EV tax credit is due to end on September 30, 2025.
To be fair, there are plenty of variables on the gas side, too. One only needs to look at gas price fluctuations that can be influenced by similar forces as well as world events. If you log a lot of miles per year, that can also even the odds. That's one reason why EVs have been gaining in popularity with rideshare drivers.
Environmental Impact: While saving money on an EV is an obvious goal for any shopper, there's an additional component that appeals to a smaller group. Greenhouse gases are contributing to global climate change, and many with children or a long view of history prioritize responsible stewardship of the environment and are willing to spend a little more for to lower their carbon footprint.
There is a lot of disinformation and some disagreement on this topic that is, again, subject to many variables. It takes more energy to produce an EV than a gas equivalent. It also takes more resources, but the payback in efficiency makes up for a lot of these drawbacks. Carmakers are also moving toward reduced emissions from the manufacturing process.
One of the more common criticisms of EVs is that "the energy has to come from somewhere," and to that point, the detractors are partially correct. That said, even if an EV derived most of its power from a utility that runs on fossil fuels, it will still emit fewer harmful compounds than a gas vehicle over its lifetime.
Nationwide, renewable power sources (wind, solar, nuclear, etc.) have increased to 20 percent, and in one isolated test case, California has been able to function on renewables alone for extended periods. If the trend continues, not only will the environment benefit, but power costs should also drop.
On the back end, there is also some criticism about the leftover waste when an EV is retired. Depleted electric car batteries are not littering the landscape, as some critics say. There's a lot of value in the components, and recycling is more economical than raw material production.
Toyota has been in the vehicle electrification business longer than most, and over the last few decades, it has developed its own recycling infrastructure. The metal and plastic parts take a traditional recycling path, while the battery chemicals are separated and reused. Toyota aims to reclaim 95 percent of these materials.
Cons of Electric Cars
Range and Charging: As with nearly everything, EVs aren't perfect, and there are still some obstacles to conquer. Driving range used to be the biggest concern when EVs were only capable of 100 to 200 miles.
Nowadays, 300 miles seems to be the target many carmakers are aiming for, but outliers such as the Lucid Grand Touring can exceed 500 miles on a full charge. That's well beyond what most drivers will ever need, especially when you consider most need a break on a long road trip and fast charging is available at public charging stations.
Knowing how you'll use your EV is especially helpful when choosing one. If you're not expecting to do a lot of long-distance driving, you could easily make do with a more affordable and lighter model. There's no use in lugging around extra weight if you're not going to use it. To put it into perspective, the average driver only travels between 30 and 41 miles daily.
Charging networks were also a big concern, but in the last few years, we've seen a marked improvement. The Infrastructure Law enacted in 2021 allocated funds to build out public charging access as well as improve reliability. There are now twice as many EV charging stations available than there were before the Law took effect.
EV charging takes longer than filling your tank with fuel, but even those times are dropping. At a DC fast charger, many EVs can replenish their batteries from 10 percent to 80 percent in as little as 20 minutes. That's not much longer than a bathroom break and a stop for some snacks. There are still far fewer public chargers than needed, though. On a holiday weekend, you can expect a long line of EVs waiting to charge at strategically placed stations.
Depreciation: As of November 2024, EVs are taking a big hit in regard to depreciation. Over the last year, used EVs have been losing value at an alarming rate. In some of the most extreme cases, as much as 50 percent of the vehicle's purchase price in the first year. The typical gas-powered car loses about 20 percent in value in the same period.
This is a recent trend that hasn't fully been explained; there are a lot of contributing variables. One could be that there are many more EV choices than before, and competition is good for the consumer.
Another is that EV and battery technology advancements are happening at a very rapid pace. What was cutting-edge three years ago may not be as fresh today, reducing its appeal and, in turn, the price. There are also fewer incentives to entice shoppers of used EVs
Then, there's the notion of battery replacement. As noted earlier, new models are required to provide 100,000 miles of warranty coverage. We're still in the early stages of EV development, and there's not a lot of concrete data on battery longevity.
Experts agree that EVs should last 10 to 20 years, which compares favorably to gas vehicles, which average between eight and 12 years. Both vehicles are prone to huge variables related to how the vehicle is treated and maintained.
In the event that you need to replace a battery out of warranty, the costs could be as devastating as when your mechanic says you need a new engine. For example, a Chevrolet Bolt battery replacement can cost between $15,000 and $20,000, while a Volkswagen ID.4 can climb past $27,000.
An internal combustion engine replacement, on the other hand, could cost between $5,000 and $15,000. When you look at the current state of EV reliability and these costs, they really don't pose as big a threat as once imagined.
Future Outlook for Electric Cars
Wide acceptance of EVs has only been around for 15 or so years, compared to the century-plus of development on internal combustion engines. In that short time, technology has progressed at an accelerated rate, with range increasing and prices decreasing.
If we manage to maintain this pace, we could imagine 600-plus mile ranges, super-quick charging, and far fewer EV drawbacks. This would lessen the strain on public charging, giving it a chance to keep up with demand.
New battery technology is promising smaller and lighter components with fewer rare Earth elements and more responsible mining and refining. Combined with more efficient clean energy production, all of these can contribute to reduced passenger vehicle emissions, which make up about 16 percent of all greenhouse gases released by the U.S.
Recently, carmakers have been making moves to integrate EVs into home environments. In essence, you could use your EV as a home battery. If you have solar, you can run your house off your EV's battery at night or charge when electricity costs less during off-peak hours. It can end up saving you on utilities while also giving you added peace of mind in the event of a power outage.
Overall, we've come a long way with EVs, but we also have some ways to go. At least for now, it seems as though consumers are warming up to the idea of EV ownership. It's not yet at the point where we can definitively say there's an EV for every type of shopper, but with each passing year, we're seeing more models that are within reach of the average driver.
There is no shortage of variables that can help or harm progress, but even those will normalize with time. To answer the title question of "Are Electric Cars Worth It?" that depends a lot on your budget, living situation, usage, and priorities. As uncertain as the future is, it continues to look bright for EVs, so expect to see more on your local dealership forecourt.