According to JD Power, evs now cost approximately $54,000, which is 22% than they’d have cost at the same time last year. As more individuals want to transition away from fossil-fuel-powered automobiles, this is another financial hit, given that electric vehicles are often more expensive.
Not only have electric vehicles increased in price, but ICE-powered automobiles have increased by 14%, with an average price of $44,000, according to the Wall Street Journal. The situation in Ukraine has made problems with the supply chain worse and raised the cost of materials for automakers. Higher production costs are passed on to customers, resulting in significantly higher average car prices.
Read More: New Car Prices Reach New Highs, But Sales Drop 18.7 Percentage This Year.
Due to the necessity for rare earth metals such as lithium, nickel, and cobalt to produce the battery packs, the cost of building an electric car is tenfold more than that of a fossil-fuel-powered vehicle. According to Alix Partners, the cost of all of these items has jumped by 140 percent, from $3,381 in March 2020 to $8,255 presently.
Gas prices are steadily climbing and are predicted to top $6 per gallon this summer. Manufacturers face an uphill struggle if electric vehicles are to be widely accepted.
According to statistics from Kelley Blue Book and Autotrader, searches for electric vehicles increased by 73 percent in January, indicating that consumers are serious about making the switch. However, being on par with ICE vehicles isn’t enough; EVs must be superior in every way, and cheaper.