Should I buy an electric car? How to decide in 2024

With steep costs to fill up, plus the ever-present worries over climate issues, many drivers are itching for another solution. You might be asking, “Should I buy an electric car?” And you wouldn’t be alone.

Electric vehicle (EV) sales have jumped in the past few years. But the expensive upfront cost of an electric vehicle might not be right for every driver.

Is it a good time to buy an electric car?

EVs made up 8.55 percent of new vehicle purchases in the fourth quarter of 2023, according to Experian. Many buyers — 44.8 percent — chose to finance with an auto loan. Just over 30 percent chose leasing.

Consistently high gas prices may have helped to propel EV sales. A gallon averaged $3.35 on March 4, 2024, according to AAA.

This growing interest in electric vehicles has led to advancements in available financing, including green auto loans and tax credits.

The choice to buy electric should be approached with the same care as determining the make and model of your next car. For some, the convenience of never gassing up paired with minimal maintenance makes the high price tag worthwhile.

Upsides of driving an EV

Purchasing an electric vehicle has advantages beyond a positive environmental impact.

Enjoyable driving experience

EVs often have luxury features to match their higher price point.

“The driving experience of electric cars is very rewarding,” says Brian Moody, executive editor at Autotrader. “Acceleration is more brisk and electric cars have cool features like the ability to heat up or cool down your car’s interior before you hit the road.”

Available incentives

Driving electric also carries federal and potential state benefits you would not traditionally have access to. One of these is the federal EV tax credit, an incentive worth $7,500 for qualifying new plug-in and fuel-cell electric vehicles. Your home state may also offer tax credits.

New in 2023 was a federal tax credit for used EVs. The vehicle cannot be priced above $25,000. If it qualifies, you can claim a credit for up to 30 percent of the sale price, capped at $4,000.

Both federal tax credits come with income limits and vehicle requirements, so make sure you and your potential future EV qualify before diving in.

Increasing options

The electric car industry has seen great innovation over the past two years and will continue to expand. While upfront costs have historically been high, they’re dropping as legacy brands dive into the electric car market.

EV sales in the fourth quarter of 2024 were up, according to Kelly Blue Book. A record 1.2 million U.S. drivers opted to buy an EV. And while Tesla still leads the charge, accounting for 55 percent of the market, that number is down from 65 percent in 2022.

“It used to be true that there were only a handful of very small or very expensive electric cars.” Moody shares. “While EVs are more expensive as a whole, some individual models are more reasonably priced.”

More-affordable options include:

• Chevrolet Bolt.
• Kia EV6.
• Nissan Leaf.

Downsides of driving an EV

Before climbing into the driver’s seat, consider possible drawbacks.

Potentially expensive repairs

A 2023 study from Solera, a vehicle lifecycle management company, found that EV repairs were dramatically costlier.

The study considered 90,000 repairs. It found EV repair costs averaged 29 percent higher than internal combustion engine (ICE) vehicles costs. More than that, EV parts carry a larger price tag, 48 percent higher than their traditional counterparts.

Fewer servicing options

EV servicing infrastructure is expanding. But there is still a long road ahead to reach parity with the ICE industry. A Cox Automotive service study found that 58 percent of dealers need more infrastructure for EV servicing. More than that, over half need more EV-trained staff.

Depreciation

Electric cars can depreciate faster than ICE vehicles because of the speed of tech advancements. However, the current demand for EVs is helping to stabilize prices at the moment.

Can EVs carry a lower lifetime cost?

Climate worries aren’t the only reason people are turning to EVs. There’s also the potential to save money. While it is true that gas isn’t the only cost of driving, in some cases driving electric can be cheaper over time.

And even if the average cost of EV repairs is higher, you may need them less often. Cox Automotive’s study found that 53 percent of dealers expect the average EV cost to be higher but 72 percent believe the number of services to be the same or lower.

Consider a plug-in

A plug-in hybrid model can be more fuel-efficient than ICE models but kinder on your wallet than an EV. As Moody explains, these tend to carry a lower price tag and “function as an electric car on a day-to-day basis, consuming gas only for long trips.”

This makes them an option for drivers interested in driving electric but not ready to commit fully.

Questions to ask before buying an electric vehicle

Owning and operating an electric car comes with an additional set of needs that you may not have dealt with in the past. Consider these questions.

1. What is the vehicle range?

Check the distance your vehicle can get you — for both your typical commute and your travel habits. Energy.gov reports the average range for 2023 model-year vehicles was 270 miles, with a potential range of up to 516 miles.

With ranges this high, drivers will likely deal with less “range anxiety.” But check your needs by factoring in your typical commute and expected leisure activities.

2. Should I lease before I buy an electric car?

“Leasing an electric car can be a good way to test the waters of EV ownership,” Moody says. Leasing an EV is typically less expensive on a month-to-month basis and usually includes a warranty. Plus, your lessor may apply the savings they get from the federal EV tax credit to your lease, further cutting your cost.

If you are on the fence about driving electric, consider leasing one to see if you like the feel and experience.

3. Do I have access to vehicle chargers in my area?

Many drivers do not have the luxury of installing a Level 2 charger. Luckily, some EVs now have the option to charge from any electrical outlet, although it may take all night or longer to get a full charge.

That said, you might need a speedier charge at times. Many EVs take about 45 minutes to reach 80 percent battery capacity at a fast-charging station. To find out where you might be able to get a faster charge, check out PlugShare, which maps out charging stations nearby. Double-check that any charging stations you plan to frequent are compatible with the car you’re considering.

How to finance an electric vehicle

Financing an electric vehicle is similar to financing a traditional gas-powered car. To get the best auto loan rate, compare rates and available terms.

The growing market for electric vehicles has also led to advancements in financing. EV-specific lenders like Tenet are gaining popularity. They provide drivers with a tailored experience through green auto loans.

Other companies work like loan marketplaces where drivers can compare EV loans. EV Life is one such platform.

Consider an EV when shopping for your next vehicle

So, is an electric car worth it? Like any other luxury vehicle, EVs can carry higher upfront costs, and drivers need a strong credit profile to benefit from low interest rates. But as the industry grows and more mid-tier options pop up, more drivers can reasonably consider an electric option.

If you are considering electric, Moody recommends aiming for the sweet spot by buying lightly used — in the three- to five-year range. You’ll benefit from a lower price and remaining warranty coverage.