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Is Now The Time To Buy Your Electric Vehicle?

Anyone unsure of when to buy an electric vehicle should look at the calendar, circle today’s date – and make a call to their nearest EV dealer, posthaste. Chances are the person on the other end of the line will start trotting out buyer incentives in less time than it takes a Tesla Model S to hit 60 miles per hour.

Prices of EVs have been slashed in recent months as manufacturers deal with fallout from the COVID-19 pandemic. With overall car sales in decline, EV manufacturers are offering deals that might have been unimaginable earlier in the year.

“The underlying reality is that there has been a dramatic slowdown in car sales since the pandemic swept the nation, causing an oversupply for many models and an eagerness to sell from manufacturers and dealerships alike. There are price reductions and great deals to be had, whether they are announced or not,” said Gabriel Shenhar, associate director of the auto test program at Consumer Reports. 

Consumer Reports noted that EV industry leader Tesla cut the prices of its Model 3, Model S and Model X electric cars by as much as $5,000 in response to a recent slowdown in demand. Luxury EV models from competing carmakers have been selling at discounts of 10-16 percent off the manufacturer’s suggested retail price, while less-expensive EVs and hybrids are selling at 5-9 percent below the MSRP.

These price cuts arrive amid a longer-term trend of even more affordable EVs. According to a Quartz report, research house Cox Automotive showed that average EV prices in mid-2019 fell 13.4 percent from the previous year to $55,600 – mostly due to Tesla’s success selling the Model 3, which boasted a starting retail price of $38,990 before incentives.

Lower prices aren’t the only reason it’s a good time to buy an electric vehicle. The cars themselves have never been better from an environmental and performance standpoint. 

On the environmental side, electric cars produce much lower emissions on average than gas-powered vehicles. Research compiled by the Union of Concerned Scientists found that a gas-powered car in the U.S. would have to get 73 miles per gallon to equal the emissions produced by the average EV. EVs are expected to keep getting greener in coming years as power grids also become greener. Scientists from Radboud University in the Netherlands project that by 2030, the average carbon intensity of EVs will be 20 percent lower than it was in 2015.

In terms of performance, the biggest, recent strides involve how long an EV car battery lasts before it needs to be recharged. A recent report from the International Energy Agency projects that by 2030, battery-powered EVs will reach an average driving range of 220 to 250 miles – for battery sizes of 70 to 80 kilowatt hours. That compares to an average range of 181 miles in earlier EV models.

Meanwhile, a major effort is underway to give the EV industry a boost through various subsidies and tax incentives. The Los Angeles-based Transportation Electrification Partnership recently sent a $150 billion proposal to congressional leaders that would support the growth of zero-emissions vehicles. The partnership began as a collaboration between L.A. Mayor Eric Garcetti, Southern California Edison, the Los Angeles Department of Water and Power and the Los Angeles Cleantech Incubator. Others involved include auto manufacturers–Tesla, Audi, BMW and BYD–as well as EV software maker Greenlots and automotive and energy storage firm Proterra.

The partnership’s two main proposals include:

Extended tax credit: Some EV buyers qualify for an income tax credit of up to $7,500, but that credit phases out for vehicles purchased from carmakers that have sold 200,000 EVs – a threshold already reached by Tesla and General Motors. The Transportation Electrification Partnership’s proposal would extend that credit to future Tesla and GM electric car buyers. It also would authorize a new credit for other EVs and equipment, and create a scrap-and-replace program similar to Cash-for-Clunkers but geared toward electric cars.

Building new infrastructure: The proposal would allocate $85 billion for zero-emission vehicle infrastructure. This money would go toward the following: utility upgrades; new charging stations for medium- and heavy-duty vehicles as well as transit and school buses; new solar and energy storage projects to make grids more resistant to natural disasters; commercial and residential vehicle recharging; light-duty charging infrastructure; state and government EV fleets; and support for the Low-Income Home Energy Assistance Program.

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