Say goodbye to the hefty price tags of new electric vehicles – long-range EVs are now cheaper than your average gas car.
The EV market is reaching an exciting new milestone in the US. Thanks to fierce competition and the introduction of affordable long-range models, some new EVs are now cheaper than the average gas-powered car. This shift is helping to make electric cars a viable option for more consumers.
According to data from Cox Automotive, the average transaction price for new vehicles in April 2024 was $48,500. However, a growing number of long-range EVs with over 300 miles of range are available for less than this average. For instance, the Hyundai Ioniq 6, with its impressive 361-mile range, starts at $42,450. This makes it one of the best overall EVs on the market today.
Tesla is also offering affordable options, with the Model Y starting at $44,900 and providing 320 miles of range. When you factor in the $7,500 federal tax credit, the price drops significantly, making it an even more attractive option. General Motors is stepping up with the Chevy Equinox EV, which currently starts at $42,000. With the tax credit, this means an MSRP lower than $35,000. An even more affordable trim, the 1LT, is expected to launch later this year at $33,600, offering 319 miles of range.
Despite these advances, EVs are still about 15% more expensive than gas cars on average. However, this gap is closing as manufacturers focus on bringing more affordable models to market. Stellantis, for example, plans to launch a $25,000 electric Jeep soon, emphasizing the importance of affordability for mass-market adoption. CEO Carlos Tavares recently highlighted the need to sell EVs to the middle class to achieve scale.
The push for affordability is not without challenges, though. Automakers are under pressure to reduce costs drastically, which could strain some companies. However, the competition is driving innovation and cost reductions. New models, such as the upcoming Bolt EV from GM, are expected to be among the most affordable EVs when they launch in 2025.
Federal incentives continue to play a crucial role in making EVs more accessible. The $7,500 tax credit helps bring down the cost of new EVs, making them competitive with gas-powered cars. Leasing options are also becoming more attractive, with some EV leases costing up to 37% less than similar gas-powered models from brands like Toyota and BMW.
Consumers’ demands are evolving as well. American buyers now expect their EVs to have at least 300 miles of range, which has become a benchmark for most drivers. This expectation is shaping the market, pushing manufacturers to develop long-range batteries as standard.
The shift towards EVs is part of a broader trend, with more affordable models expected to hit the market soon. Brands like Kia, Hyundai, and Ford are all working on ramping up their EV offerings. By 2030, price parity between EVs and gas cars is expected to be the norm, according to the International Energy Agency.
As the market evolves, the focus on affordability and range will be key to driving widespread adoption of electric vehicles. With competitive pricing and continued innovation, the future of EVs looks bright, and pretty sure more consumers will be able to make the switch to electric driving.
