EV Adoption Starts At The Pricey High End, And Slowly Works Its Way Downscale

There are dozens of new electric vehicles for mass-market brands, on the ground or in the pipeline for the U.S. market.

In time, and with much greater sales volume, EVs could even close the price gap between electric vehicles and vehicles with internal combustion engines.

But for now, EVs are still pricey on average. According to Kelley Blue Book, the average new EV price in September was an estimated $65,291, well above the industry average of $48,094.

That EV average was down 1.8% vs. August 2022, but 9.7% higher than September 2021, according to Kelley Blue Book data. That’s luxury-brand territory.

In addition to high average transaction prices, there are other costs of EV ownership that some buyers seem to overlook before purchasing, said Brian Moody, KBB executive editor, in a phone interview.

“I’m always surprised that people, even people who work for financial publications, coming at it from a financial perspective, don’t take into account the overall costs of an electric car,” he said.

“From a financial perspective, if the average is $65,000-plus, that’s going to be expensive not only in the purchase price, but also in the interest. And you also take a bigger hit on depreciation,” he said.

Meanwhile, there’s an arms race, so to speak, among electric vehicle manufacturers in terms of miles per charge-up. The new benchmark for bragging rights is probably around 300 miles. However, that 300-mile range comes with some asterisks, Moody said.

“Does the average person know that to extend the lifetime of the battery, the instructions are to give it an 80% charge, and not to charge it fully each time? So, right away it’s already not 300 miles. And in Michigan, sometimes it’s zero degrees, so it’s really not 300 miles, now,” he said.

Still, there are smaller EVs with relatively more affordable pricetags coming online, like the Volvo C40 Recharge and the Kia EV6, Moody said. “They are really good,” he said, “and starting to deliver some cool features.”