Within a few years, electric vehicles (EVs) will be superior to gasoline powered cars in every respect.
In fact, leading experts now predict that EVs will soon have a lower upfront cost to go with their many superior attributes, which include a much lower operating cost and much faster acceleration.
But that means if you buy a new gas-powered car, SUV, or truck in the near future, you may find it increasingly obsolete and difficult to resell.
Just last week, Wall Street Journal auto columnist Dan Neil discussed why buying a new internal-combustion (IC) engine car would be a big mistake — the equivalent of buying a flip phone in a world of smart phones.
“This is above all a pocketbook issue for me,” Neil writes. “A gas-powered vehicle would be too expensive.”
This financial calculus is based not just on the fact that electric vehicles (EVs) have become technologically superior in every respect and have a vastly lower operating cost. But it’s also the result of the price and performance of EVs improving so rapidly that many major countries — like China, India, the UK, and France — are planning to ban or phase out gas-burning cars in the coming years.
“During the reasonable service life of any vehicle I buy today, I expect the demand for IC-powered vehicles will drop to practically zero, equivalent to the current market penetration of flip phones,” Neil predicts in his column. “No one will want them.”
The EV revolution has been enabled by a rapid drop in the price of lithium-ion batteries — a stunning 85 percent drop since 2010 alone, as Bloomberg New Energy Finance (BNEF) reported last month. That price drop that has fueled an EV boom worldwide.
But the increase in sales has in turn led to both increased investment in the batteries and economies of scale, so BNEF forecasts the price drop will continue for a long time.
In fact, BNEF says EVs won’t merely have a lower life cycle cost than gasoline powered IC cars, they will actually have a lower first cost.
BNEF’s head of energy storage analysis, Logan Goldie-Scot, told Bloomberg News last month that this “inflection point” should come in “the early to mid 2020s.”
And when you then factor in the collapse in resale value of IC vehicles, plus the rapidly dropping price of wind and solar power, then the choice to buy an EV will become increasingly easy for consumers.
The choice is already obvious to Neil, especially since so many “exceptional electrics and hybrids will roll off the line over the next 18 to 36 months.”
So he is putting off his next purchase — a truck — two years until the all-electric Rivian R1T is available. The Rivian promises over a 400-mile range and 750 hp with superior hauling capability. It will go 0 to 60 mph in 3 seconds.
To readers who want to buy an IC truck now, Neil has a warning: “You go ahead and finance that $70,000 pickup with V8 power for 60 months. It’ll be a two-ton albatross around your financial neck before it’s over.”