Should You Buy an Electric Car Now or Wait For a While? Let’s Find Out

During the coronavirus pandemic, there was a significant increase in the cost of vehicles that had not been seen before. After that, the shortage of semiconductor chips affected the automotive industry a lot, causing automakers to limit the use of these chips to their most profitable and expensive models. As a result, millions of affordable vehicles, which are typically purchased by most new car buyers, were not manufactured.

This resulted in a rise in the average price of new vehicles in the United States from approximately $38,000 prior to the pandemic, to a new record of around $49,000 in February. The average price of electric vehicles (EVs) went up significantly in February, reaching over $58,000. This is approximately equivalent to the yearly earnings of the typical American worker. Dealerships have been able to sell EVs at prices well above the listed sticker price as buyers have lost their bargaining power.

Mark Wakefield, an automotive expert at the consulting firm AlixPartners, says that those who haven't been shopping for a car recently may be surprised by the high cost of vehicles in today's market. As you are reading one of the best electric car blogs, we are going to explore the recent trends in the industry.

The current shortage of electric vehicles (EVs) is clashing with an unexpected surge in demand. Inventory levels are significantly lower than pre-pandemic levels however EV sales are still exceeding even the most optimistic predictions from a few years back. In January of 2022, EVs made up only 4.3 percent of new car sales, whereas, in January of this year, that percentage increased to over 7 percent.

Ivan Drury, an automotive market analyst for Edmunds, explains that EVs are in such high demand that they are essentially sold out for the remainder of the year.

Let’s talk about the positives of the electric car industry

Despite vehicle prices reaching record highs, there may soon be opportunities for better deals. Tesla has started reducing prices, causing other electric vehicle (EV) manufacturers to do the same. The introduction of new federal tax incentives is also on the horizon, but the eligibility of vehicles for these incentives may change. Moreover, many automakers will be launching new all-electric models in the coming months.

So, for someone considering buying an EV, the question arises: should they make their purchase now or wait?

Although there is no definitive answer, the decision of whether to buy an EV or not can be narrowed down to a few other considerations such as:

1. How much money can you afford to spend?
2. What kind of vehicle suits your needs?
3. Do you, or the EV you're interested in, qualify for any federal incentives?
4. Would you consider purchasing a used EV or leasing one instead?

If you can easily spend on the cost of a new EV, you use a vehicle a lot, and you qualify for the federal incentive, you can certainly buy a new EV. Otherwise, it is better to wait if you can.