7 ms·

Isn't this short term thinking? That is the upfront cost. What about the total lifetime cost of the vehicle?

foepys 6y ago
People buying cars for $20,000 are generally not people who can invest twice upfront for lower maintenance costs over the next ten years. Being poor (relatively speaking) is expensive, especially when you are financing.
- dahfizz 6y ago
  Isn't this situation a bit different? You're financing your car anyway, so its "free" to finance a car that $75/mo more expensive if you spend $75/mo less in gas savings. Factor in not having to pay for maintenance and it really is cheaper month to month. This is different from the classic example of having to buy cheap, low quality boot every month for $10 instead of buying really nice boots for $200 that would last a decade. The upfront cost of the nice boots (and the insane interest rates for credit cards) make the nice boots impossible to afford. EDIT: This is besides the point, but I don't think people dropping 20k on a car are "poor" in the way we are discussing anyway. Anyone buying a brand new car obviously has some money to spend
- Ekaros 6y ago
  Also 20k buys lot of maintenance, and gas. I wonder if at that price difference the maintenance and gas even is cheaper. Ofc, depends on driven distance, but still.
- holoduke 6y ago
  I an in a fortunate position to earn much more than a average salary. Yet our family car is a 2005 10k infinity fx35. Car is reliable and modern enough. A perfect fit for my family of 4. I considered buying a 80k Tesla model X, but went for a 15 year old Ferrari f430 (same price). Still have the practically and a lot of extra fun. I never understood why people would buy a car younger than 15 years old.
  - oblio 6y ago
    Safety features.
  - PragmaticPulp 6y ago
    > I never understood why people would buy a car younger than 15 years old. 15 years typically translates to 180K - 200K miles for average use cases. 15 year old cars are generally not in great shape. Finding low mileage, well-maintained unicorns is not as easy as it sounds.
  - URSpider94 6y ago
    The difference in safety between a 15 year old car and a new car is breathtaking.
  - _ph_ 6y ago
    There are several reasons. First of all, cars that old usually have a quite used up interior even to the point of being unpleasant. But the big thing is maintenance. If you can't do repairs on your own and with cars just 15 years old that gets increasingly more difficult, maintenance and repairs will kill you. At a certain point the upkeep will exceed the amortised costs of buying a new car.
  - 2trill2spill 6y ago
    15 year old cars might be better economically. But if your in a car accident, your definitely going to want to be in a modern vehicle.
Someone1234 6y ago
Gas is down to $3 and electric $12/kWh, with the state now charging electric vehicles higher registration fees yearly to offset the gas tax savings. There's likely small savings every year, but we're talking almost $20K price difference, maybe $12K with federal (and no state) rebate, you aren't going to be breaking even. Plus fun fact: My insurance would go up a lot with a Model 3 from my current vehicle, 25% more a month. Why? I have no idea, but I'm guessing higher write-off or repair costs.
- deleted 6y ago
  [deleted]
- Hamuko 6y ago
  The Model S was at least notorious for long and expensive repairs if you got into a crash. Not sure if that's the case for the Model 3 but Model S insurance rates are most probably high because of that.
  - the_duke 6y ago
    Still the case for Model 3/Y. Repairs can take months due to lack of spare parts.
- elihu 6y ago
  I think you mean 12 cents a kWh? (So, a 60kWh battery can store $7.20 of electricity. Charging isn't perfectly efficient, so more like $8 to fully charge.) Let's say you can go 200 miles with that $8 of energy, that's 4 cents a mile. Let's say a gas car is 30 miles per gallon of $3 gas, or 10 cents a mile. Over 200,000 miles, that's $20,000 for fuel, versus $8,000 of electricity in the EV. Seems like the total cost of ownership just about breaks even with federal rebates, and ignoring maintenance costs (generally expected to be higher with the gas vehicle) and ignoring that paying the cost up-front for an EV removes the potential for that money to accrue interest (which favors the gas vehicle). I'm hoping the EV costs continue to fall until we get to close to parity in terms of vehicle purchase price. This can happen either by battery prices falling, or for people to adjust their expectations and accept shorter range, or for the need for large batteries to become obsolete due to electrified roads that let you charge while the vehicle is still moving.
glbrew 6y ago
If anything the lifetime cost of electric deters me. Usually they come with 10 year warranties for the power side of the car, but I kept my last car for 20 years. If I buy electric I assume I essentially need to buy a new car or pay for an expensive overhaul after a decade. So the math is more along the lines of 20k for a gas car that will last for 20 years, or 40k for an electric car that will probably last 10 years. Yes, you save some on energy but probably won't offset total cost difference.
- kingsuper20 6y ago
  For some reason you're downvoted. I think that's a reasonable fear, dunno what the failure rate on large components will look like, especially batteries. One problem is that electric cars are bound to advance more quickly than something as mature as ICE-based ones. It would be easy to end up with something that's obsolete or poorly supported from a parts standpoint.
- SketchySeaBeast 6y ago
  Don't forget to factor in fuel cost and maintenance.
  - kingsuper20 6y ago
    and insurance. and government tithes (additional highway taxes are probably on the way)
- deanak 6y ago
  If you're keeping your car for 20 years, there are at least three or four timing belt/chain replacements and a ton of maintenance if you are putting typical miles on. Plus you're always one bad part away from blowing the engine, and there's no way to stop the inevitable long term decline of engine compression and replacing your transmission/clutch. Electric vehicles outperform ICE powered vehicles on every metric, including price. Electricity is getting cheaper and cleaner over time, and so are batteries. In 10 years today's $10k battery pack might be twice as potent and half the price. I would stick with VW or other manufacturers, as Tesla is being cheap about battery chemistry for long term performance.
mikestew 6y ago
Oh, oh, I can answer this, given ownership of a ten year old Leaf ($35K) and a fifteen year old Scion xB/rebadged Toyota Echo ($20K): the $20K car is still going to win in TCO. Because the Leaf already starts out $15K in the hole. That's a lot of oil and coolant changes. That's a lot of brake pads. And those are pretty much the three things an ICE needs done versus BEV. After 100K miles, the Scion needed a $1500 clutch job. After 50K miles, the Leaf needs a new $5K battery pack (it'll last a few more years, but it's coming). The Leaf still needs tires. It still needed the 12V accessory battery changed out. It still needs a cabin air filter changed once in a while. The Leaf has been reliable, nearly maintenance-free, and pretty appliance-like. But the Scion is a close second. We'll probably never buy an ICE again, that's how much we've like the Leaf and BEV in general. But "out of touch" doesn't even begin to describe someone arguing that those willing to spend $20K should spent twice as much because "TCO".
- bananabreakfast 6y ago
  You left out the very important and difference making cost of gasoline. Which over 10 years of driving would more than make up the difference in cost.
  - geoelectric 6y ago
    That may depend on where you live, and what your electricity consumption already is. In CA, for example, with our tiered billing and PG&E's award-winning business practices, it's pretty easy for an electric car to rack up quite an energy bill. If you were already using electricity up to the top of your tier, the add for the car will be at $$$ rate. So they also have non-tiered plans for electric car owners but those are time of use. If you use them at peak for whatever reason, $$$ again. It's a little tricky. It won't be as expensive as liquid fuel, to be sure, but the savings over time might not be as high as you'd expect. Offsetting with solar seems to be the popular option around San Jose, where homeowners tend to be particularly affluent.
    - zbrozek 6y ago
      Beware NEM 3.0. Note that the CA utilities are working to try to keep milking you even if you have solar. The most loathsome part of it is that the utilities are trying to charge you $10/month/kilowatt-peak for the array you own, even if they push zero energy onto the grid. From my perspective, that's ridiculous rent-seeking. Personally I'm working towards getting off the grid entirely.
imtringued 6y ago
TCO/month has been 200€ for me for a cheap ICE. This includes car purchase, yearly servicing, random repairs and gasoline. There is no way for me to spend less money without buying used. The Dacia Spring would cost me 200€ TCO/month. A Kia Soul EV with 60kWH could cost me 250€ TCO/month for a slightly bigger car and more range+max speed. I wouldn't save money, but I also wouldn't break the bank. Right now it's a wash. I haven't calculated CO2 tax increases into the TCO though. Give it another 5 years and you would have to be stupid to buy ICEs.

People buying cars for $20,000 are generally not people who can invest twice upfront for lower maintenance costs over the next ten years. Being poor (relatively speaking) is expensive, especially when you are financing.

dahfizz 6y ago
Isn't this situation a bit different? You're financing your car anyway, so its "free" to finance a car that $75/mo more expensive if you spend $75/mo less in gas savings. Factor in not having to pay for maintenance and it really is cheaper month to month. This is different from the classic example of having to buy cheap, low quality boot every month for $10 instead of buying really nice boots for $200 that would last a decade. The upfront cost of the nice boots (and the insane interest rates for credit cards) make the nice boots impossible to afford. EDIT: This is besides the point, but I don't think people dropping 20k on a car are "poor" in the way we are discussing anyway. Anyone buying a brand new car obviously has some money to spend
Ekaros 6y ago
Also 20k buys lot of maintenance, and gas. I wonder if at that price difference the maintenance and gas even is cheaper. Ofc, depends on driven distance, but still.
holoduke 6y ago
I an in a fortunate position to earn much more than a average salary. Yet our family car is a 2005 10k infinity fx35. Car is reliable and modern enough. A perfect fit for my family of 4. I considered buying a 80k Tesla model X, but went for a 15 year old Ferrari f430 (same price). Still have the practically and a lot of extra fun. I never understood why people would buy a car younger than 15 years old.
- oblio 6y ago
  Safety features.
- PragmaticPulp 6y ago
  > I never understood why people would buy a car younger than 15 years old. 15 years typically translates to 180K - 200K miles for average use cases. 15 year old cars are generally not in great shape. Finding low mileage, well-maintained unicorns is not as easy as it sounds.
- URSpider94 6y ago
  The difference in safety between a 15 year old car and a new car is breathtaking.
- _ph_ 6y ago
  There are several reasons. First of all, cars that old usually have a quite used up interior even to the point of being unpleasant. But the big thing is maintenance. If you can't do repairs on your own and with cars just 15 years old that gets increasingly more difficult, maintenance and repairs will kill you. At a certain point the upkeep will exceed the amortised costs of buying a new car.
- 2trill2spill 6y ago
  15 year old cars might be better economically. But if your in a car accident, your definitely going to want to be in a modern vehicle.

Someone1234 6y ago

Gas is down to $3 and electric $12/kWh, with the state now charging electric vehicles higher registration fees yearly to offset the gas tax savings. There's likely small savings every year, but we're talking almost $20K price difference, maybe $12K with federal (and no state) rebate, you aren't going to be breaking even. Plus fun fact: My insurance would go up a lot with a Model 3 from my current vehicle, 25% more a month. Why? I have no idea, but I'm guessing higher write-off or repair costs.

deleted 6y ago
[deleted]
Hamuko 6y ago
The Model S was at least notorious for long and expensive repairs if you got into a crash. Not sure if that's the case for the Model 3 but Model S insurance rates are most probably high because of that.
- the_duke 6y ago
  Still the case for Model 3/Y. Repairs can take months due to lack of spare parts.
elihu 6y ago
I think you mean 12 cents a kWh? (So, a 60kWh battery can store $7.20 of electricity. Charging isn't perfectly efficient, so more like $8 to fully charge.) Let's say you can go 200 miles with that $8 of energy, that's 4 cents a mile. Let's say a gas car is 30 miles per gallon of $3 gas, or 10 cents a mile. Over 200,000 miles, that's $20,000 for fuel, versus $8,000 of electricity in the EV. Seems like the total cost of ownership just about breaks even with federal rebates, and ignoring maintenance costs (generally expected to be higher with the gas vehicle) and ignoring that paying the cost up-front for an EV removes the potential for that money to accrue interest (which favors the gas vehicle). I'm hoping the EV costs continue to fall until we get to close to parity in terms of vehicle purchase price. This can happen either by battery prices falling, or for people to adjust their expectations and accept shorter range, or for the need for large batteries to become obsolete due to electrified roads that let you charge while the vehicle is still moving.

glbrew 6y ago

If anything the lifetime cost of electric deters me. Usually they come with 10 year warranties for the power side of the car, but I kept my last car for 20 years. If I buy electric I assume I essentially need to buy a new car or pay for an expensive overhaul after a decade. So the math is more along the lines of 20k for a gas car that will last for 20 years, or 40k for an electric car that will probably last 10 years. Yes, you save some on energy but probably won't offset total cost difference.

kingsuper20 6y ago
For some reason you're downvoted. I think that's a reasonable fear, dunno what the failure rate on large components will look like, especially batteries. One problem is that electric cars are bound to advance more quickly than something as mature as ICE-based ones. It would be easy to end up with something that's obsolete or poorly supported from a parts standpoint.
SketchySeaBeast 6y ago
Don't forget to factor in fuel cost and maintenance.
- kingsuper20 6y ago
  and insurance. and government tithes (additional highway taxes are probably on the way)
deanak 6y ago
If you're keeping your car for 20 years, there are at least three or four timing belt/chain replacements and a ton of maintenance if you are putting typical miles on. Plus you're always one bad part away from blowing the engine, and there's no way to stop the inevitable long term decline of engine compression and replacing your transmission/clutch. Electric vehicles outperform ICE powered vehicles on every metric, including price. Electricity is getting cheaper and cleaner over time, and so are batteries. In 10 years today's $10k battery pack might be twice as potent and half the price. I would stick with VW or other manufacturers, as Tesla is being cheap about battery chemistry for long term performance.

mikestew 6y ago

Oh, oh, I can answer this, given ownership of a ten year old Leaf ($35K) and a fifteen year old Scion xB/rebadged Toyota Echo ($20K): the $20K car is still going to win in TCO. Because the Leaf already starts out $15K in the hole. That's a lot of oil and coolant changes. That's a lot of brake pads. And those are pretty much the three things an ICE needs done versus BEV. After 100K miles, the Scion needed a $1500 clutch job. After 50K miles, the Leaf needs a new $5K battery pack (it'll last a few more years, but it's coming). The Leaf still needs tires. It still needed the 12V accessory battery changed out. It still needs a cabin air filter changed once in a while. The Leaf has been reliable, nearly maintenance-free, and pretty appliance-like. But the Scion is a close second. We'll probably never buy an ICE again, that's how much we've like the Leaf and BEV in general. But "out of touch" doesn't even begin to describe someone arguing that those willing to spend $20K should spent twice as much because "TCO".

bananabreakfast 6y ago
You left out the very important and difference making cost of gasoline. Which over 10 years of driving would more than make up the difference in cost.
- geoelectric 6y ago
  That may depend on where you live, and what your electricity consumption already is. In CA, for example, with our tiered billing and PG&E's award-winning business practices, it's pretty easy for an electric car to rack up quite an energy bill. If you were already using electricity up to the top of your tier, the add for the car will be at $$$ rate. So they also have non-tiered plans for electric car owners but those are time of use. If you use them at peak for whatever reason, $$$ again. It's a little tricky. It won't be as expensive as liquid fuel, to be sure, but the savings over time might not be as high as you'd expect. Offsetting with solar seems to be the popular option around San Jose, where homeowners tend to be particularly affluent.
  - zbrozek 6y ago
    Beware NEM 3.0. Note that the CA utilities are working to try to keep milking you even if you have solar. The most loathsome part of it is that the utilities are trying to charge you $10/month/kilowatt-peak for the array you own, even if they push zero energy onto the grid. From my perspective, that's ridiculous rent-seeking. Personally I'm working towards getting off the grid entirely.

imtringued 6y ago

TCO/month has been 200€ for me for a cheap ICE. This includes car purchase, yearly servicing, random repairs and gasoline. There is no way for me to spend less money without buying used. The Dacia Spring would cost me 200€ TCO/month. A Kia Soul EV with 60kWH could cost me 250€ TCO/month for a slightly bigger car and more range+max speed. I wouldn't save money, but I also wouldn't break the bank. Right now it's a wash. I haven't calculated CO2 tax increases into the TCO though. Give it another 5 years and you would have to be stupid to buy ICEs.