Americans Are Paying $10,000 More for Electric Cars This Year Compared to Last Year

Due to continued supply chain issues and hard-to-source raw materials, Americans are paying $10,000 more for electric cars this year compared to last.
Written by Preston Charles
Reviewed by Kathleen Flear
Jul 16, 2022
Like most things technologically driven, it seemed as though
electric cars
were starting to become both more evolved and more affordable. While the beefy ranges and thoughtful designs are welcomed, sadly, the
prices of electric cars
in America have reversed course and are now heading up.  
With the current inflation rate, it’s true that the price for vehicles, electric or fuel, has increased in the past year. But the rise for traditional gas cars is 14% compared to 22% for electric cars. So what happened to cause this most unfortunate turn in events? The reasons are multifold but interconnected. 

Raw materials are driving up the cost of EVs

With electric cars, there’s a whole new category of needed parts to build out their engines, specifically, their batteries. Necessary materials like nickel,
lithium
, and cobalt have all surged in price as a result of continuing supply chain headaches. The war in Ukraine has compounded the issue since Russia was a big exporter of certain metals used to make battery cells. 
According to
Yahoo News
, the average price of these raw goods has surged a mind-boggling 140% in the last two years! Financial analysts believe this perfect storm may well continue as far as 2024. Maybe an electric bike in the meantime? 

Car companies scramble

At this point, Tesla has weathered more than a few storms and as a result, has been able to establish itself as an electric car juggernaut. But, they’ve certainly had better years than 2022. Their Model X is taking a price hike of around $6,000 and founder, Elon Musk, has decided to lay off 3.5% of its total workforce. 
Ford
has followed suit in a steep price hike as their profits from the red hot popular, Mustang Mach-E, have been nearly wiped out due to commodity increases. In the meantime, Ford’s traditional, fuel-powered vehicles are still funding for their expansion into the EV landscape. 

The most affordable electric cars out there

If you’re still committed to finding the best bang for your buck electric car, here are a few options to consider:
  • Nissa Leaf - Base price is $27,800 with a maximum range of 149 miles.
  • Mini Cooper SE - Base price is $34,225 with a maximum range of 110 miles.
  • Chevrolet Bolt - Base price is $31,500 with a maximum range of 259 miles. 
Some of these (and others) come with an appealing, $7,500 federal tax credit, but only until the manufacturer hits 200,000 units sold. Tesla and GM have long hit that threshold and Toyota isn’t far behind. 

Insurance for the ride

Whether you end up going green and paying the increase or staying with the fuel-powered car for the time being, you’re going to want solid insurance because now is a rough time to buy a car! Super app,
Jerry
, can get you competitive quotes from major insurance companies in a matter of minutes. 
Jerry will even do the pesky paperwork for you to get signed up! You’ll start saving money and driving in peace that you’re covered just in case.
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National General
Allstate
AAA
Aig
Chubb
ClearCover
CSE
Dairyland
DirectAuto
Elephant Auto Insurance
Kemper
Libertymutual
Gainsco
Mapfre
Mercury Auto
Metromile
Nationwide
Plymouth Rock
Progressive
State Auto
Safeco
Travelers
Metlife
Bristol West

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