In general, electric vehicles (EVs) are more expensive than traditional cars that run on gasoline. However, the price difference is closing.
The Kelley Blue Book’s most recent statistics indicate that the average cost of a new electric car was $55,689, a 4.2% decrease from a year ago. In contrast, the average price of a gas-powered vehicle was $48,800, a 1.5% increase over the previous year. The average transaction price for Tesla, the industry leader in electric vehicles, dropped to over $52,900, a decrease of almost 9% from the previous year.
The cheapest electric vehicle, the 2025 Nissan Leaf, starts at $29,280 with the destination fee included. Luxury EVs, such as the 2025 Mercedes-Benz EQS SUV, start at $106,400 with the destination fee and cost over $100,000.
In comparison to the same period previous year, EV sales for the quarter decreased by 6.3% overall.
In the short term, there was anticipated to be a significant demand for EVs due to the urgency caused by the administration’s intention to phase off government-backed, IRA-era EV incentives. If the previous month is any indication, the mission has been completed. Sales in July came very close to setting a monthly record. As long as customers act quickly before the major incentives expire, Q3 will be the best ever and then some.
EV Tax Incentives Going Away
Don’t put off switching to electricity for too long. The federal government provides electric vehicle tax credits of up to $4,000 for qualified old EVs and up to $7,500 for qualifying new EVs. Renting? Depending on the dealership, you may still be eligible for the full credit on new cars. The price difference between EVs and gas-powered vehicles is reduced in part by these incentives. Here’s the catch, though: On September 30, those credits are removed. A new spending package that does away with electric car tax benefits was passed by lawmakers. Prices for all cars, including EVs, may also increase as a result of the current levies on imported autos and parts.
Taking action sooner could save you thousands of dollars if you’re thinking about buying an electric car.
Gas-powered vehicles require frequent oil changes, gasoline, and other maintenance; fully electric vehicles run on electricity instead. Those who drive electric vehicles can also save money because fuel is typically more expensive than electricity.
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