"Green vehicles — notably EVs — have grown increasingly top of mind for American consumers over the last year as more automakers have generated buzz around new products and made strong commitments to an electrified future. But the major surge in interest of late is certainly more of a reaction to record gas prices sparked by the war in Ukraine," said Jessica Caldwell, Edmunds' executive director of insights. "Unfortunately, making an EV purchase is not particularly easy to do right now amid inventory shortages, and price-sensitive consumers most affected by gas price hikes will likely find that making the switch is also a bit out of financial reach due to the premiums that these vehicles command."
According to Edmunds data, the average transaction price for a new EV climbed to $60,054 in February, which was $1,820 more than their average MSRP of $58,234. The average transaction price for a new vehicle (including EVs) was $45,596 in February, which was $680 above the average MSRP of $44,916.
Although EVs do not offer much in the way of cost savings in today's market, Edmunds analysts acknowledge there are many reasons other than gas prices for consumers to consider going green for their next purchase.
"Automakers have made it clear for quite some time that EVs are the future of the industry, and environmental sustainability is a growing concern for consumers," said Caldwell. "If jumping into a new EV is a top priority for you right now, it's not going to be particularly easy to make a purchase, but there are some steps you can take to ease the process."
To help consumers looking for a place to start, Edmunds experts put together an insider guide:
- Determine whether an EV suits your budget and lifestyle needs. Edmunds' editors have put together an extensive EV Buying Guide for shoppers to help consumers understand the pros, cons and options available in the growing EV market. They also rank the best EVs of 2022 and 2023 here.
- Consider EVs from brands that have shorter wait times or more available inventory. Check with the manufacturer's website before placing your pre-order to make sure the timeline works for you. With the ongoing semiconductor shortage and other supply chain issues, wait times are fluid and not a guarantee.
- Consider a plug-in hybrid or regular hybrid vehicle. Edmunds experts note that plug-in hybrids and hybrids offer more fuel efficiency than regular gas-powered vehicles, and might be more widely available than EVs right now, which could be a nice compromise for consumers. Edmunds lists some of the best plug-in hybrid and regular hybrid vehicles of 2022 and 2023 here.
- Consider a used EV, but be aware of potential pitfalls. Older EVs might offer some cost savings, but at the price of less efficiency and shorter ranges.
"There are very few scenarios in today's market in which the impulse purchase of a new vehicle — EV or not — just to save on fuel costs will result in savings. Once you factor in the monthly payment and insurance costs, you're likely going to be spending more than you will save in gas," said Ivan Drury, Edmunds' senior manager of insights. "But if you're already in the market for a replacement vehicle, you could view this surge in fuel prices as a reminder that, although many other aspects of vehicle ownership have set monthly costs, fueling can vary significantly. Since purchasing the most fuel-efficient vehicle possible is the only way to minimize this variable, now might be the time to consider a partially or fully electrified powertrain."