Electric Cars: Buying Considerations

by Amy Lillard

(3/24/2013) Electric cars may be the future of the automotive industry. Cars like those manufactured by Tesla represent an exciting new advancement for consumers and the environment. But what do you need to know when considering an electric car? In this series, we examine key information to help you step into the future.

When you’re buying a new car, you have some important questions to think about. Savvy buyers will determine their budget, what size of car they need, their choice of new or used, and their financing options before hitting the lot.

But the introduction of a completely new type of car into the mix can leave some buyers intrigued yet confused. If you’re considering an electric car among your buying options, the choices are a bit different and the details a bit more involved. Here are a few key things to consider when making your decision:

• Financing. Because they’re new, electric cars carry a higher price tag than many of the typical gas-powered vehicles available. Buyers need to consider this initial payout may be larger, but costs over time can be less, with higher efficiency and lower maintenance costs. But the biggest thing to remember here is the substantial incentives offered by federal and state governments that help offset this initial cost. Electric-car buyers get a $7,500 federal tax credit at the end of the year to offset the purchase price, and many states offer additional tax benefits as well.

• Expected maintenance. When buying a car, consumers should always consider the costs and likelihood of needed repairs and routine maintenance. The same applies with electric cars. Because they boast much simpler machines without combustion engines and other complex pieces, nearly all the routine checkups will not be needed with electric cars, nor will costs from machinery breakdowns. The major cost you will incur is for battery replacement in 7-10 years, which currently tops $10,000. It is expected to drop in price over time.

• Efficiency. In today’s world of escalating gas prices, efficiency is a major concern for many buyers. When buying an electric car, you will find the highest efficiency on the market. You can drive an electric car for around three to four cents per mile, compared to eleven cents per mile for gas-powered cars. Of course each electric car will vary slightly in their use of electricity, so be sure you understand the expected output of electricity per hour.

• Extras. Typically when buying a “normal” vehicle, the extras thrown in at the point of purchase are unnecessary and to be avoided. But with the case of electric cars there are a few additional extras that might be worth it. Buyers can choose between a standard charging method, which is included with the car and which will require approximately 20 hours for a full charge, or a “Level 2 charger,” which is typically a wall-mounted charger that can be placed in a garage and recharges a car in half the time. This type of charger carries a higher price tag - be prepared to pay at least $1,000. In addition, ensure you have as complete a warranty at purchase as you need, and remember that many will cover the cost of battery replacement, the single biggest maintenance need you will have.

Electric Cars: Buying Considerations

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Amy Lillard

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