After a hot start, electric vehicle (EV) sales at the beginning of 2024 represented just 9 percent of the new car market, with many dealers publicly complaining that they were having a hard time moving them off the lot. A new study claiming that gas-powered or internal combustion engine (ICE) vehicles may be more economical to drive is not going to help motivate buyers who are reluctant to buy an EV.
Anderson Economic Group, based in Lansing, Michigan, has released updated fueling cost estimates, which compared ICE vehicles with EVs in the fourth quarter of 2023, and found that with gas prices dropping across the country, gas-powered vehicles might be cheaper to fuel than equivalent EVs.
“Dealers, especially those for GM and Ford, have had to absorb tens of millions of dollars in costs building charging infrastructure,” Patrick Anderson, CEO and president of Anderson Economic Group, told The Epoch Times. “But some buyers remain strong in believing that EVs are here to stay. The big question is: Should the government continue to mandate them?”
The federal government has set a firm goal of requiring that EVs (or zero-emissions vehicles) make up half of all new cars sold in the country by 2030.
“The Biden administration appears to now recognize that its EPA rules are way outside what the market wants,” Mr. Anderson said.
The zero-emission road to 2030 has been anything but smooth for the industry in the past year. Hertz, for example, sold off tens of thousands of their EV inventory because of a lack of demand. GM has slowed or even cut its investment and is producing more hybrids, and Ford found that sales for the all-electric F-150 Lighting did not meet expectations and slowed production. Stellantis, on the other hand, remains steadfast in its dedication to EV production. However, CEO Carlos Tavares told several media outlets that the company must make its own batteries to help keep costs down.
According to Kelley Blue Book’s parent company, Cox Automotive, the average transaction price for electric cars was $53,469 last summer, compared with $48,334 for gas-powered vehicles.
In its comparison study, Anderson found that entry-level ICE cars such as the Honda Civic and Subaru Impreza had an average fueling cost of $9.46 per 100 purposeful miles (going to a destination, not a gas or charging station). The cost for 100 miles of operating a similar size/model EV, such as the discontinued Chevrolet Bolt (which will be back in 2025) and the Nissan Leaf, was estimated at $12.55 when charging primarily at home.
As for mid-priced cars and crossovers, Anderson found that ICE vehicles, including the Chevy Malibu and Nissan Altima, were also more cost-effective to fuel, at about $10.71 per 100 miles. EVs in that segment, including Tesla Models 3 and Y and Kia’s EV6 came in at $12.61 and $16.11 using commercial charging options.
“When gas prices go up, the EVs look more economical,” Mr. Anderson said.
Nationally, as of March 1, 2024, according to AAA, regular gas prices were at $3.61. In June 2022, the average price of a gallon of gas nationally was a little more than $5.
“I think this study is coming at a time when there is a lot of EV skepticism and a bit of retaliation against EVs. I think some of it is the political backlash against the Biden fuel economy regulations,” said Rex Roy, an automotive journalist and former original equipment manufacturer marketer who has helped launch more than 120 vehicles and 32 auto brands in his career. “I also think there’s an overall backlash from the left against EVs because of Elon Musk. They’re going to use this study to keep beating up on the EV industry.”
But Mr. Roy told The Epoch Times that he doesn’t think the Anderson study was politically motivated.
“The study did break out specific groups of vehicles, so they were trying to compare vehicles by segment,“ he said. ”So, I do think this was an honest study and that they were trying to compare apples to apples. The problem is that EVs are all so different. I think it’s too simplistic to say ICE vehicles are cheaper than EVs. There are very affordable EVs on the market that are not only inexpensive to purchase but to run.”
The EV segment that fared best in the Anderson analysis was luxury-priced cars and crossovers. Models such as the Porsche Taycan and the Tesla Model X, when charged mostly at home, were seen to be the most economical at $13.50 per 100 miles compared with ICE cars such as the BMW 5 series or the Cadillac CTS, which cost $17.81 per 100 miles.
