13 ms·

Electric cars aren't affordable because America's workforce is underpaid

74 points by stalfosknight 3y ago

black_13 3y ago
[dead]
tracker1 3y ago
Maybe something to do with the dealers dramatically inflating prices beyond list? Or maybe the mfg going along with it, increasing base prices so they get a bigger cut of the inflated pricing? I mean, electrics are more expensive to produce, but I really don't buy that they aren't overpriced.
- w0mbat 3y ago
  Electric cars are not intrinsically more expensive. Because EVs are simpler mechanically they will be cheaper to make than ICE cars once the battery packs get cheap enough. It is an ever-descending cost as the technology improves and the volume goes up. I agree that greedy Ford dealers helped cause this problem. I looked at the Ford Mach-E but was turned off by dealer markup, got a Tesla instead.
  - antisthenes 3y ago
    > Electric cars are not intrinsically more expensive. Because EVs are simpler mechanically they will be cheaper to make than ICE cars once the battery packs get cheap enough. This is nonsense, because the battery packs are already cheap enough. The value of savings from cheap battery packs is simply not being passed on to the end consumer, because the car companies and dealerships can get away with not doing so. It doesn't matter if Ford or Tesla builds battery packs for $90/KWh and the engine is 2x cheaper than the ICE car, if later on it is marked up appropriately to be sold as a luxury good. NONE of the battery packs in current EVs cost more than $10000 to make, for ANY manufacturer. Which means they are pricing the econoboxes that contain the batteries at $30,000, which is ridiculous.
    - antisyzygy 3y ago
      There's another angle there too. The dealers are often up-charging MORE for fuel efficient hybrids or EVs. It might be 2-5k more for a gas burner, but you get nailed 10k over MSRP for the hybrid or EV option. They're effectively making you pay the difference in the cost of gasoline up front so there's no economic incentive to the consumer to get the better MPG or emission-free option. I haven't done the math but intuitively it seems like you end up pre-paying the difference you'd save by using less to no gasoline. I think part of it is also that dealers / manufacturers are creatively trying to capture tax incentives as well. Instead of the consumer getting a cheaper EV via tax breaks, the dealer or manufacture charges that much more and it ends up in their pocket. It's messed up. Just about every large business in America is on the government teat in various creative ways. They're not innovating or competing anymore.
      - WorldMaker 3y ago
        > They're effectively making you pay the difference in the cost of gasoline up front so there's no economic incentive to the consumer to get the better MPG or emission-free option. A different way to look at it: the dealers are trying to make you pay for the difference in oil changes and maintenance costs. EVs don't need regular oil changes and service checkups. For many dealers those services are their actual bread-and-butter where they make the most profit.
  - martin8412 3y ago
    Ah yes, the battery which is the most expensive part that also determines range doesn't make the car more expensive. Let's the poors have a 1kWh battery.
    - w0mbat 3y ago
      The battery pack does not have to be expensive, and they have in fact been getting cheaper and more energy dense year after year. Technology moves on.
  - antisyzygy 3y ago
    Screw Ford dealers. Ford should go direct. Lobby for changing the law to get rid of these parasites. I just bought a ford less than a year ago. One of those Maverick trucks since the gas mileage is really good. It's a good suburban truck for hauling or camping that still lets you commute to the city and navigate tight spaces. The hybrids were actually marked up the worst, often 10k rather than 5k, and couldn't have AWD which was one of my requirements.
    - WorldMaker 3y ago
      Ford would have to find a way to "fire" most of their shareholders first given how many of their most vocal shareholders are dealers.
    - tracker1 3y ago
      I saw Lightning trucks going upwards of 40k over list. It was ridiculous, definitely won't be buying anything from that company any time soon. I think the dealers are entrenched middle men and it's time for more competition all around.
  - tracker1 3y ago
    I don't think adding a massive Lithium-Ion battery pack is less expensive than an ICE engine. Not even considering the scarcity and environmental cost of said battery packs at current production levels, which would only increase at scale.
    - w0mbat 3y ago
      It doesn't just remove the need for an ICE engine, also the gearbox, fuel pump, fuel tank, radiator, exhaust system including catalytic convertor, etc. An ICE engine is intrinsically complex to make, has many moving parts that wear out, is hot because it is inefficient at turning fuel into power. Plus, you know, the pollution. A battery pack that holds sufficient joules is not intrinsically large and expensive any more than a 100 megabyte disk had to be the size of a washing machine and cost as much as a house, which was once the case. Battery packs, even with current technology, cause little to no environmental damage, that is oil industry propaganda. Lithium and cobalt are fairly common, and all the cobalt we would ever need is accidentally produced as a side-effect of copper and nickel mining all over the world, that we would be doing anyway.
      - tracker1 3y ago
        Have you seen the battery packs in vehicles that have anything resembling a decent range? They're massive, and yes they are expensive.
rybosworld 3y ago
If you want to discuss car affordability, the dealers are mostly to blame. The car dealership model has been a disaster for the consumer and is nothing short of a racket.
- quantified 3y ago
  If dealerships were removed, would the scammy culture be transferred to the manufacturers, or would the culture become any better?
  - mcguire 3y ago
    Tesla, notably, has no dealers. https://www.extremetech.com/cars/tesla-accused-of-secretly-cancelling-service-appointments-for-poor-vehicle https://www.extremetech.com/cars/tesla-accused-of-secretly-c...
  - rybosworld 3y ago
    In other countries you can order the exact car you want. In the U.S., dealers make that incredibly difficult unless you agree to pay a huge premium. That alone is worth the abolishment of dealerships. Not to mention the time you waste haggling on price. A car salesman in the U.S. will try to sell you a trim you didn't want. They'll sell you a color you didn't want. They'll sell features you didn't want. All because that's what their current inventory dictates. Here's a question for all the free-market enthusiasts: If the car dealer model is supposedly so great for both sides, then why didn't it spawn organically? Why did it require special regulation to bring it into existence? Wouldn't the free market forces have done this on their own? The current model in the U.S. is insanity and I can't understand how anyone whose job doesn't depend on it, defends it.
- delfinom 3y ago
  Tesla maintains a 30% profit margin vs the 5% profit margin of other automakers. The car dealership model of course inserts another middleman markup and other bullshit, but direct to consumer doesn't prevent profitinflation, and we saw just that in other sectors with the mass profitinlation the last 2 years.
falcolas 3y ago
Going to need more used stock for people who can’t afford new, more specifically those who can’t afford the value cliff associated with a new car. The used market will naturally grow, but it will delay adoption.
- deleted 3y ago
  [deleted]
- wpietri 3y ago
  The trouble with this approach is that people with less money then only get the things that got made for rich people and then set aside. When I got my first car, the thing many of my peers ended up with is the land yacht: https://en.wikipedia.org/wiki/Land_yacht_(automobile) https://en.wikipedia.org/wiki/Land_yacht_(automobile) I was very lucky to get a hand-me-down Japanese economy car. It was efficient and reliable. But my peers had to spend a lot more on gas and deal with more frequent repairs. The land yachts were expensive to operate because they were made for rich people but cheap to buy because they were out of fashion and not a great deal in the long term. I'd much rather see us producing low end models that people of modest means can buy new, ones designed for that market.
  - mrguyorama 3y ago
    Indeed, poor people don't need a secondhand Escalade, they need a Geo Metro. But your average american seems to be willing to pay twice as much for gas and buy a truck for whatever reason.
    - falcolas 3y ago
      A second hand geo metro would cost even less, making it more attractive. The same will be true with Tesla model 3’s. Even $30k is a lot to spend on a vehicle.
  - falcolas 3y ago
    It’s how the car market operates for most of the US today. Dealers make more off used sales than they do new.
Pet_Ant 3y ago
> that the only way to cater to American tastes I think that is the crux of many tragedies to come. Our tastes, standards, and expectations are unsustainable. Single family dwellings. Non-local foods out of season. Things will have to adjust.
- gjsman-1000 3y ago
  Sounds like a great idea to get reactionary leaders elected from people who don't want change. Change works much better with carrots than sticks.
  - Pet_Ant 3y ago
    I'm not saying it as a campaign promise, I'm saying it as an uncomfortable truth for us who think about these things. How to sell it to the public is PR's job.
    - maxwell 3y ago
      Ah yes, what we need is a Leni Riefenstahl for climate propaganda.
  - mrguyorama 3y ago
    There's not always a happy option when you've ignored a problem for a hundred years. Sometimes the option is a self induced stick, or a way bigger stick from something else that you don't get to choose. It's rank entitlement to believe you personally should never have to change anything to make the world a better place. IMO this is a huge reason why the younger generations have been worthless at doing government things. The Bud Light and Dylan Mulvaney situation proved that average consumers can absolutely still affect big businesses in a way that leads to uncomfortable discussions with shareholders, you just have to be willing to settle for a different product. Meanwhile plenty of gay people and people who believe gay people deserve equal rights still buy a fucking chicken sandwhich from a fast food place that donates to organizations that explicitly exist to fight gay rights, rather than deprive themselves of, once again, a medium quality fried chicken sandwich that you can get from ten other establishments or literally any pub.
exabrial 3y ago
[flagged]
- deleted 3y ago
  [deleted]
- vannevar 3y ago
  >The last one is the worst crime. Property Taxes are designed to keep poor people poor... Most places have a homestead exemption for this very reason. But you're right, it would make more sense to have a progressive property tax rather than a flat rate.
- alex_young 3y ago
  How does one pay property taxes on a car? I pay property tax on real estate property, not cars IIRC...
  - quantified 3y ago
    They might call it an excise tax, Massachusetts does. A state could tax you on anything. It's not enormously expensive but it is above zero.
    - mcguire 3y ago
      Or a registration fee.
      - quantified 3y ago
        That is different, I believe. Massachusetts excise tax is based on some idea of the value of your vehicle. Registering your new BMW and your beater Pontiac costs the same.
- tantalor 3y ago
  TIL some states charge property taxes on cars. https://www.mansionglobal.com/articles/which-u-s-states-charge-property-taxes-for-cars-220298 https://www.mansionglobal.com/articles/which-u-s-states-char... > Virginia has the highest vehicle taxes, the report found. There, residents pay an effective rate of 4.05%, meaning an annual bill of $1,011.
gonehome 3y ago
55k on average is ignoring the entry cost of a model 3 (especially with incentives) - also average is just a bad metric for affordability. An extreme example: https://electrek.co/2023/07/24/brand-new-tesla-model-3-less-than-14000-california/ https://electrek.co/2023/07/24/brand-new-tesla-model-3-less-... That's also an outlier, but less than 30k isn't which makes this post somewhat misleading (at best). The Model Y was also the top selling vehicle globally across all categories for Q1 2023: https://www.theverge.com/2023/5/26/23738581/tesla-model-y-ev-record-world-bestselling-car-electric https://www.theverge.com/2023/5/26/23738581/tesla-model-y-ev... and in 2022 was the best selling car in the US: https://www.teslarati.com/tesla-model-y-2022-best-selling-top-10/ https://www.teslarati.com/tesla-model-y-2022-best-selling-to... Ford's cars are probably too expensive because they ignored the EV market for a decade and it takes time to scale up production and reduce costs. > "The big problem for EVs from a price standpoint is that the whole industry has decided that the only way to cater to American tastes is to make their EV fleet out of trucks and SUVs, eliminating the economical sedans that might be affordable." I'd guess this is because Ford can't profitably make an affordable sedan (they can't do so without losing a lot of money) so they need to make a more expensive vehicle with better margins, Tesla did this too of course - they just had a decade head start while the legacy manufacturers did nothing.
- ThatGeoGuy 3y ago
  > That's also an outlier, but less than 30k isn't which makes this post somewhat misleading (at best). I don't disagree that this _isn't_ misleading in a way but it's also important to consider that most EVs are subject to what you said right after: > Ford's cars are probably too expensive because they ignored the EV market for a decade and it takes time to scale up production and reduce costs. Notably that Tesla still isn't at a scale of production where walking off the lot with a < $30k vehicle is possible! There usually isn't a lot to walk off of, but its rare that the base model will be available at all! Most of the cars they are producing are not the base package, and likely will never be. The thing about supply chains here is that the "base model" is a much smaller percentage of actual manufacturing. Most of the time if a manufacturer were to produce 1M units a year, less than 30% will be the very base model. I'm not sure there are clear numbers published anywhere, but you can bet that while the "base model" might seem affordable you're unlikely to find it due to the same supply chain constraints — Tesla would much rather up-sell you to some package above the base model and availability is restricted as-is, so which customers do you think they'll prioritize? Tesla isn't even producing millions of units yet (I think last year was just over 600k?), and this is just a drop in the bucket in the number of cars purchased each year. > I'd guess this is because Ford can't profitably make an affordable sedan (they can't do so without losing a lot of money) so they need to make a more expensive vehicle with better margins, Tesla did this too of course - they just had a decade head start while the legacy manufacturers did nothing. They don't "need" to make larger vehicles with better margins, they just prefer to have better margins. A lot of this is a downstream effect of CAFE exemptions on "light trucks," which applies to both SUVs and modern pick-up trucks. I guess my disagreement here isn't that they "can't" make sedans unless you're defining "can't" in terms of "what the shareholders said." We can absolutely regulate these things and it would probably be beneficial to do so. As for why Tesla isn't making massive trucks? EV physics (weight of batteries vs. amount of energy to move said weight) somewhat preclude this, but counterpoint there is that Tesla is making a truck and wants to be on top of that market. Sedans are in a weird space with EVs since the added weight kind of puts you in a range<->weight arms race. While most people probably don't need as much range as they think they do, you end up picking between the atrocious Hummer EV or a Model 3 (which is still very large for most of the trips you'd take with a sedan!!!).
localplume 3y ago
> First, the argument that electric vehicles are more expensive than comparable combustion cars is somewhat exaggerated. The issue large stems from the decision to electrify only the most profitable and physically largest models. For Ford, that would be the F-150 Lightning and the Mustang Mach-E. so the argument is correct, in that they are more expensive? so they should make cheaper, smaller electric cars would be the logical next step. electric cars at this point are a luxury item, and saying people cant afford luxury items because they aren't being paid enough is _technically true_ but that is misleading. maybe they should start blaming poor fiscal policy of the federal government given the govt is meant to look after its people, not automanufacturers.
vparikh 3y ago
Electric cars are still a luxury good. I can afford to buy a Tesla Model that equipped with AWD, and auto pilot (for me the marquee feature on the Tesla) comes in at 67,000 before any state & federal incentives. To put it into perspective - A Toyota 2023 Corolla Hybrid SE Infrared full loaded with AWD will cost me 30K. A Toyota 2024 Camry XSE Hybrid costs $3750 all in with all of the upgrades. Hard to justify 30K+ more for an electric vehicle - unless that is what you want an are willing to pay for it. But at this point - you can't justify the expenditure at all.
- MisterBastahrd 3y ago
  I won't pay 30K for a vehicle in the first place. I drove a Nissan Rogue Select for 6 years before it was totaled on the highway in a rear end collision. For the past two, I've driven a Mitsubishi Outlander Sport. I paid $32K total because I bought them both with 2 years on them.... and I received $13.5K back from insurance for the Rogue Select that I paid $14K for because of how wild the market was during the height of COVID. Not sure exactly what buying a $60K vehicle is supposed to do for me. The cars had Airplay, cruise control, and AC. What else am I supposed to want?
  - DaveExeter 3y ago
    It's called signaling. You buy a $60K car to signal your wealth. It's why women buy $6K handbags.
  - Tagbert 3y ago
    You bought them used. That is a different market and price structure. Most cars lose value drastically in the first year of ownership.
    - MisterBastahrd 3y ago
      Same exact market. I'm just not particular about whether the car is brand new or not, because I only need the following: Android auto, air conditioning, cruise control. Some of the other features like the rear camera are standard, and it's also got heated seats as a plus. In 2020 I was involved in a rearend accident, but I didn't think much of it because my car was still drivable even though I couldn't use the back door. Insurance company said they were just gonna cut me a random check if I didn't bring the car in to the shop. Apparently there was frame damage at very rear driver side which totaled the vehicle. So I was in a scramble to buy another car. I had multiple options, both new and used, but my rental was a Mitsubishi Outlander Sport. Loved that car. Anyway, when I set out that morning to buy a new car, I was looking for a NEW car. Talked to a dealership about a $33K special edition SUV with all the bells and whistles. Special color, moon roof, etc. But along the way, I saw a used car dealership and pulled in when I saw they had a bunch of SUVs in the lot. They had the exact same make, model, and color as the car I was driving. I don't do a lot of driving. The car had every single feature I wanted and low miles. So when they told me the price, it was a no-brainer. Picked it up the very next day.
Rapzid 3y ago
Woooahhhh 50k average? It's never crossed my mind to pay that much. Most of my friends don't own vehicles they paid more than 30k for and that includes a bunch of well-off software engineers. What's the median or if they exclude top 10% of earners? Edit: For a few years now the Chevy Bolt would be the EV I would get if in the market. Ford has nothing comparable but they are, supposedly, thinking about bringing back the Fiesta as an EV. A brand new Bolt can be had for mid 20s.
- inconceivable 3y ago
  this really should be split among people who have kids vs. not. once people have kids the budget goes up for a lot of different reasons.
- _ea1k 3y ago
  Not long ago, the price crossed $30k. I was surprised. It seems that it has moved past $50k only in the past few years. TBH, I'm shocked that the average is so high.
  - KallDrexx 3y ago
    The average is rising because dealers are pushing auto loans much longer than the previously usual 5 years. They are feeding people's lack of financial literacy with 7-8 year loans under the idea that you can buy a more expensive car while only focusing on the monthly payment.
    - _ea1k 3y ago
      A shocking number of people really only look at the payment. You aren't wrong... sigh.
martin8412 3y ago
EVs are a luxury good. The most popular affordable car is around 13k EUR in the EU from new. There are no comparable EVs in the same price range.
- _nhynes 3y ago
  Is that the Dacia Sandero? The VW Up! (not Golf, my mistake) is ~15k EUR. My knowledge cutoff transitively only goes up to 2021, so I can't be sure which one you mean, but I am curious.
  - bakje 3y ago
    Where is the VW Golf 15k EUR? I bought an 8 year old Golf with over 100k km over 2 years ago and paid around 12k EUR for it, new it was around 32k. For context this is in the Netherlands, I do believe cars are a bit more expensive here but I can't believe a new Golf would cost 15k anywhere. To be clear I'm not calling you a liar or anything, I'm genuinely curious if there are such major discrepancies between countries.
    - _nhynes 3y ago
      Ah, thanks for catching that. On the website (https://www.volkswagen.co.uk/en/configurator.html https://www.volkswagen.co.uk/en/configurator.html) I read "up!" as "Golf" for some reason. Indeed the Golf is about the price you quoted.
  - martin8412 3y ago
    Dacia Sandero indeed. Golf starts at around 30k.
  - WorldMaker 3y ago
    Doesn't the Dacia Spring prove that they can do a "non-luxury" EV? It's not that much more expensive than the Sandero.
- CameronNemo 3y ago
  Cars in general are a luxury.
Thoeu388 3y ago
[dead]
wmf 3y ago
Original source: https://prospect.org/economy/2023-07-31-ford-electric-cars-arent-affordable/ https://prospect.org/economy/2023-07-31-ford-electric-cars-a...
deleted 3y ago
[deleted]
westcort 3y ago
Copper reserves are insufficient to manufacture even the first generation of EVs.[0] The decarbonized economy will require horses and bicycles (both net zero emissions). The good news is that reducing solar intensity by 2% would compensate for a doubling in CO2 levels, however (see Manabe and Wetherald 1975).[1,2] I hope governments will not wait too long to act. If a solar shield is not implemented within the next 20 to 30 years, the opportunity to do so may close as a result of generalized collapse. [0] https://press.spglobal.com/2022-07-14-Looming-Copper-Supply-Shortfalls-Present-a-Challenge-to-Achieving-Net-Zero-2050-Goals,-S-P-Global-Study-Finds https://press.spglobal.com/2022-07-14-Looming-Copper-Supply-... [1] http://faculty.eas.ualberta.ca/jdwilson/EAS372_13/manabe75.pdf http://faculty.eas.ualberta.ca/jdwilson/EAS372_13/manabe75.p... [2] https://www.researchgate.net/profile/Syukuro-Manabe-2/publication/234326505_The_Effects_of_Changing_the_Solar_Constant_on_the_Climate_of_a_General_Circulation_Model/links/5682a20308ae19758391a63b/The-Effects-of-Changing-the-Solar-Constant-on-the-Climate-of-a-General-Circulation-Model.pdf https://www.researchgate.net/profile/Syukuro-Manabe-2/public...
TradingPlaces 3y ago
This is backwards. Vehicle quality has gotten much better, and that means used vehicle quality has gotten much better. Since about 2012, used vehicles have taken over the low end of sales, and now manufacturers in the US are beginning to cede that market to used. For the price of a subcompact, you can get a pickup or SUV with low miles, and Americans prefer larger cars. That’s why average new car price is so high. https://fred.stlouisfed.org/graph/fredgraph.png?g=17uXw https://fred.stlouisfed.org/graph/fredgraph.png?g=17uXw https://seekingalpha.com/instablog/49663329-trading-places-research/5874921-why-new-cars-are-expensive-in-us https://seekingalpha.com/instablog/49663329-trading-places-r...
jscipione 3y ago
CEO Henry Ford was sued by his shareholders for paying his employees a dividend to be able to afford a vehicle. The shareholders won. https://corpgov.law.harvard.edu/2021/12/01/dodge-v-ford-what-happened-and-why/ https://corpgov.law.harvard.edu/2021/12/01/dodge-v-ford-what...
johnea 3y ago
This is a beautiful example of history repeating itself. In the 1960's Japanese cars started to replace the overpriced, low reliability US "Big-3" automakers. Now, after dacades in theUS, the Japanese makers are also slaves to the LUXURY product. They can't imaging selling a vehicle for less than $50K. In China, an EV "city car" can be bought for < $10K, fully equiped EVs are < $30K. The US is rpie for these lower cost, higher reliability vehicles, but it seems this time it won't be Japan thats inovating. After decades of using the cheap Chinese labor force now US industrialists are afraid of the monster they've created, thus the cold war...
WheelsAtLarge 3y ago
If the premise was right then it would mean that the workforce wouldn't even be able to afford gas powered cars either. We know they can afford gas powered cars. Increasing incomes will only make it harder for people to afford EVs. It's a self defeating process. The reason EV's aren't affordable is because batteries and the overall EV manufacturing process has not yet achieved economies of scale. Gas powered cars have many more parts and require more labor to create. The reason they are less expensive is that manufacturers have squeezed out most inefficiencies out of the system including outsize profits. Give EVs time and we'll see them stabilize at a price that most workers can afford. The last thing Ford and such companies want is to make a product only the rich can afford. As vital patents expire and more competitors become part of the manufacturing process we'll see prices come down to a price that's reasonable versus people's income. We have seen it with Tesla. 20 years ago only the very rich could afford Tesla's first car. Recently they introduce a somewhat affordable car. Affordability will continue. Believe in the process, it's just a matter of time.

74 points by stalfosknight 3y ago

[dead]

Maybe something to do with the dealers dramatically inflating prices beyond list? Or maybe the mfg going along with it, increasing base prices so they get a bigger cut of the inflated pricing? I mean, electrics are more expensive to produce, but I really don't buy that they aren't overpriced.

w0mbat 3y ago
Electric cars are not intrinsically more expensive. Because EVs are simpler mechanically they will be cheaper to make than ICE cars once the battery packs get cheap enough. It is an ever-descending cost as the technology improves and the volume goes up. I agree that greedy Ford dealers helped cause this problem. I looked at the Ford Mach-E but was turned off by dealer markup, got a Tesla instead.
- antisthenes 3y ago
  > Electric cars are not intrinsically more expensive. Because EVs are simpler mechanically they will be cheaper to make than ICE cars once the battery packs get cheap enough. This is nonsense, because the battery packs are already cheap enough. The value of savings from cheap battery packs is simply not being passed on to the end consumer, because the car companies and dealerships can get away with not doing so. It doesn't matter if Ford or Tesla builds battery packs for $90/KWh and the engine is 2x cheaper than the ICE car, if later on it is marked up appropriately to be sold as a luxury good. NONE of the battery packs in current EVs cost more than $10000 to make, for ANY manufacturer. Which means they are pricing the econoboxes that contain the batteries at $30,000, which is ridiculous.
  - antisyzygy 3y ago
    There's another angle there too. The dealers are often up-charging MORE for fuel efficient hybrids or EVs. It might be 2-5k more for a gas burner, but you get nailed 10k over MSRP for the hybrid or EV option. They're effectively making you pay the difference in the cost of gasoline up front so there's no economic incentive to the consumer to get the better MPG or emission-free option. I haven't done the math but intuitively it seems like you end up pre-paying the difference you'd save by using less to no gasoline. I think part of it is also that dealers / manufacturers are creatively trying to capture tax incentives as well. Instead of the consumer getting a cheaper EV via tax breaks, the dealer or manufacture charges that much more and it ends up in their pocket. It's messed up. Just about every large business in America is on the government teat in various creative ways. They're not innovating or competing anymore.
    - WorldMaker 3y ago
      > They're effectively making you pay the difference in the cost of gasoline up front so there's no economic incentive to the consumer to get the better MPG or emission-free option. A different way to look at it: the dealers are trying to make you pay for the difference in oil changes and maintenance costs. EVs don't need regular oil changes and service checkups. For many dealers those services are their actual bread-and-butter where they make the most profit.
- martin8412 3y ago
  Ah yes, the battery which is the most expensive part that also determines range doesn't make the car more expensive. Let's the poors have a 1kWh battery.
  - w0mbat 3y ago
    The battery pack does not have to be expensive, and they have in fact been getting cheaper and more energy dense year after year. Technology moves on.
- antisyzygy 3y ago
  Screw Ford dealers. Ford should go direct. Lobby for changing the law to get rid of these parasites. I just bought a ford less than a year ago. One of those Maverick trucks since the gas mileage is really good. It's a good suburban truck for hauling or camping that still lets you commute to the city and navigate tight spaces. The hybrids were actually marked up the worst, often 10k rather than 5k, and couldn't have AWD which was one of my requirements.
  - WorldMaker 3y ago
    Ford would have to find a way to "fire" most of their shareholders first given how many of their most vocal shareholders are dealers.
  - tracker1 3y ago
    I saw Lightning trucks going upwards of 40k over list. It was ridiculous, definitely won't be buying anything from that company any time soon. I think the dealers are entrenched middle men and it's time for more competition all around.
- tracker1 3y ago
  I don't think adding a massive Lithium-Ion battery pack is less expensive than an ICE engine. Not even considering the scarcity and environmental cost of said battery packs at current production levels, which would only increase at scale.
  - w0mbat 3y ago
    It doesn't just remove the need for an ICE engine, also the gearbox, fuel pump, fuel tank, radiator, exhaust system including catalytic convertor, etc. An ICE engine is intrinsically complex to make, has many moving parts that wear out, is hot because it is inefficient at turning fuel into power. Plus, you know, the pollution. A battery pack that holds sufficient joules is not intrinsically large and expensive any more than a 100 megabyte disk had to be the size of a washing machine and cost as much as a house, which was once the case. Battery packs, even with current technology, cause little to no environmental damage, that is oil industry propaganda. Lithium and cobalt are fairly common, and all the cobalt we would ever need is accidentally produced as a side-effect of copper and nickel mining all over the world, that we would be doing anyway.
    - tracker1 3y ago
      Have you seen the battery packs in vehicles that have anything resembling a decent range? They're massive, and yes they are expensive.

rybosworld 3y ago

If you want to discuss car affordability, the dealers are mostly to blame. The car dealership model has been a disaster for the consumer and is nothing short of a racket.

quantified 3y ago
If dealerships were removed, would the scammy culture be transferred to the manufacturers, or would the culture become any better?
- mcguire 3y ago
  Tesla, notably, has no dealers. https://www.extremetech.com/cars/tesla-accused-of-secretly-cancelling-service-appointments-for-poor-vehicle https://www.extremetech.com/cars/tesla-accused-of-secretly-c...
- rybosworld 3y ago
  In other countries you can order the exact car you want. In the U.S., dealers make that incredibly difficult unless you agree to pay a huge premium. That alone is worth the abolishment of dealerships. Not to mention the time you waste haggling on price. A car salesman in the U.S. will try to sell you a trim you didn't want. They'll sell you a color you didn't want. They'll sell features you didn't want. All because that's what their current inventory dictates. Here's a question for all the free-market enthusiasts: If the car dealer model is supposedly so great for both sides, then why didn't it spawn organically? Why did it require special regulation to bring it into existence? Wouldn't the free market forces have done this on their own? The current model in the U.S. is insanity and I can't understand how anyone whose job doesn't depend on it, defends it.
delfinom 3y ago
Tesla maintains a 30% profit margin vs the 5% profit margin of other automakers. The car dealership model of course inserts another middleman markup and other bullshit, but direct to consumer doesn't prevent profitinflation, and we saw just that in other sectors with the mass profitinlation the last 2 years.

falcolas 3y ago

Going to need more used stock for people who can’t afford new, more specifically those who can’t afford the value cliff associated with a new car. The used market will naturally grow, but it will delay adoption.

deleted 3y ago
[deleted]
wpietri 3y ago
The trouble with this approach is that people with less money then only get the things that got made for rich people and then set aside. When I got my first car, the thing many of my peers ended up with is the land yacht: https://en.wikipedia.org/wiki/Land_yacht_(automobile) https://en.wikipedia.org/wiki/Land_yacht_(automobile) I was very lucky to get a hand-me-down Japanese economy car. It was efficient and reliable. But my peers had to spend a lot more on gas and deal with more frequent repairs. The land yachts were expensive to operate because they were made for rich people but cheap to buy because they were out of fashion and not a great deal in the long term. I'd much rather see us producing low end models that people of modest means can buy new, ones designed for that market.
- mrguyorama 3y ago
  Indeed, poor people don't need a secondhand Escalade, they need a Geo Metro. But your average american seems to be willing to pay twice as much for gas and buy a truck for whatever reason.
  - falcolas 3y ago
    A second hand geo metro would cost even less, making it more attractive. The same will be true with Tesla model 3’s. Even $30k is a lot to spend on a vehicle.
- falcolas 3y ago
  It’s how the car market operates for most of the US today. Dealers make more off used sales than they do new.

Pet_Ant 3y ago

> that the only way to cater to American tastes I think that is the crux of many tragedies to come. Our tastes, standards, and expectations are unsustainable. Single family dwellings. Non-local foods out of season. Things will have to adjust.

gjsman-1000 3y ago
Sounds like a great idea to get reactionary leaders elected from people who don't want change. Change works much better with carrots than sticks.
- Pet_Ant 3y ago
  I'm not saying it as a campaign promise, I'm saying it as an uncomfortable truth for us who think about these things. How to sell it to the public is PR's job.
  - maxwell 3y ago
    Ah yes, what we need is a Leni Riefenstahl for climate propaganda.
- mrguyorama 3y ago
  There's not always a happy option when you've ignored a problem for a hundred years. Sometimes the option is a self induced stick, or a way bigger stick from something else that you don't get to choose. It's rank entitlement to believe you personally should never have to change anything to make the world a better place. IMO this is a huge reason why the younger generations have been worthless at doing government things. The Bud Light and Dylan Mulvaney situation proved that average consumers can absolutely still affect big businesses in a way that leads to uncomfortable discussions with shareholders, you just have to be willing to settle for a different product. Meanwhile plenty of gay people and people who believe gay people deserve equal rights still buy a fucking chicken sandwhich from a fast food place that donates to organizations that explicitly exist to fight gay rights, rather than deprive themselves of, once again, a medium quality fried chicken sandwich that you can get from ten other establishments or literally any pub.

exabrial 3y ago

[flagged]

deleted 3y ago
[deleted]
vannevar 3y ago
>The last one is the worst crime. Property Taxes are designed to keep poor people poor... Most places have a homestead exemption for this very reason. But you're right, it would make more sense to have a progressive property tax rather than a flat rate.
alex_young 3y ago
How does one pay property taxes on a car? I pay property tax on real estate property, not cars IIRC...
- quantified 3y ago
  They might call it an excise tax, Massachusetts does. A state could tax you on anything. It's not enormously expensive but it is above zero.
  - mcguire 3y ago
    Or a registration fee.
    - quantified 3y ago
      That is different, I believe. Massachusetts excise tax is based on some idea of the value of your vehicle. Registering your new BMW and your beater Pontiac costs the same.
tantalor 3y ago
TIL some states charge property taxes on cars. https://www.mansionglobal.com/articles/which-u-s-states-charge-property-taxes-for-cars-220298 https://www.mansionglobal.com/articles/which-u-s-states-char... > Virginia has the highest vehicle taxes, the report found. There, residents pay an effective rate of 4.05%, meaning an annual bill of $1,011.

gonehome 3y ago

55k on average is ignoring the entry cost of a model 3 (especially with incentives) - also average is just a bad metric for affordability. An extreme example: https://electrek.co/2023/07/24/brand-new-tesla-model-3-less-than-14000-california/ https://electrek.co/2023/07/24/brand-new-tesla-model-3-less-... That's also an outlier, but less than 30k isn't which makes this post somewhat misleading (at best). The Model Y was also the top selling vehicle globally across all categories for Q1 2023: https://www.theverge.com/2023/5/26/23738581/tesla-model-y-ev-record-world-bestselling-car-electric https://www.theverge.com/2023/5/26/23738581/tesla-model-y-ev... and in 2022 was the best selling car in the US: https://www.teslarati.com/tesla-model-y-2022-best-selling-top-10/ https://www.teslarati.com/tesla-model-y-2022-best-selling-to... Ford's cars are probably too expensive because they ignored the EV market for a decade and it takes time to scale up production and reduce costs. > "The big problem for EVs from a price standpoint is that the whole industry has decided that the only way to cater to American tastes is to make their EV fleet out of trucks and SUVs, eliminating the economical sedans that might be affordable." I'd guess this is because Ford can't profitably make an affordable sedan (they can't do so without losing a lot of money) so they need to make a more expensive vehicle with better margins, Tesla did this too of course - they just had a decade head start while the legacy manufacturers did nothing.

ThatGeoGuy 3y ago
> That's also an outlier, but less than 30k isn't which makes this post somewhat misleading (at best). I don't disagree that this _isn't_ misleading in a way but it's also important to consider that most EVs are subject to what you said right after: > Ford's cars are probably too expensive because they ignored the EV market for a decade and it takes time to scale up production and reduce costs. Notably that Tesla still isn't at a scale of production where walking off the lot with a < $30k vehicle is possible! There usually isn't a lot to walk off of, but its rare that the base model will be available at all! Most of the cars they are producing are not the base package, and likely will never be. The thing about supply chains here is that the "base model" is a much smaller percentage of actual manufacturing. Most of the time if a manufacturer were to produce 1M units a year, less than 30% will be the very base model. I'm not sure there are clear numbers published anywhere, but you can bet that while the "base model" might seem affordable you're unlikely to find it due to the same supply chain constraints — Tesla would much rather up-sell you to some package above the base model and availability is restricted as-is, so which customers do you think they'll prioritize? Tesla isn't even producing millions of units yet (I think last year was just over 600k?), and this is just a drop in the bucket in the number of cars purchased each year. > I'd guess this is because Ford can't profitably make an affordable sedan (they can't do so without losing a lot of money) so they need to make a more expensive vehicle with better margins, Tesla did this too of course - they just had a decade head start while the legacy manufacturers did nothing. They don't "need" to make larger vehicles with better margins, they just prefer to have better margins. A lot of this is a downstream effect of CAFE exemptions on "light trucks," which applies to both SUVs and modern pick-up trucks. I guess my disagreement here isn't that they "can't" make sedans unless you're defining "can't" in terms of "what the shareholders said." We can absolutely regulate these things and it would probably be beneficial to do so. As for why Tesla isn't making massive trucks? EV physics (weight of batteries vs. amount of energy to move said weight) somewhat preclude this, but counterpoint there is that Tesla is making a truck and wants to be on top of that market. Sedans are in a weird space with EVs since the added weight kind of puts you in a range<->weight arms race. While most people probably don't need as much range as they think they do, you end up picking between the atrocious Hummer EV or a Model 3 (which is still very large for most of the trips you'd take with a sedan!!!).

localplume 3y ago

> First, the argument that electric vehicles are more expensive than comparable combustion cars is somewhat exaggerated. The issue large stems from the decision to electrify only the most profitable and physically largest models. For Ford, that would be the F-150 Lightning and the Mustang Mach-E. so the argument is correct, in that they are more expensive? so they should make cheaper, smaller electric cars would be the logical next step. electric cars at this point are a luxury item, and saying people cant afford luxury items because they aren't being paid enough is _technically true_ but that is misleading. maybe they should start blaming poor fiscal policy of the federal government given the govt is meant to look after its people, not automanufacturers.

vparikh 3y ago

Electric cars are still a luxury good. I can afford to buy a Tesla Model that equipped with AWD, and auto pilot (for me the marquee feature on the Tesla) comes in at 67,000 before any state & federal incentives. To put it into perspective - A Toyota 2023 Corolla Hybrid SE Infrared full loaded with AWD will cost me 30K. A Toyota 2024 Camry XSE Hybrid costs $3750 all in with all of the upgrades. Hard to justify 30K+ more for an electric vehicle - unless that is what you want an are willing to pay for it. But at this point - you can't justify the expenditure at all.

MisterBastahrd 3y ago
I won't pay 30K for a vehicle in the first place. I drove a Nissan Rogue Select for 6 years before it was totaled on the highway in a rear end collision. For the past two, I've driven a Mitsubishi Outlander Sport. I paid $32K total because I bought them both with 2 years on them.... and I received $13.5K back from insurance for the Rogue Select that I paid $14K for because of how wild the market was during the height of COVID. Not sure exactly what buying a $60K vehicle is supposed to do for me. The cars had Airplay, cruise control, and AC. What else am I supposed to want?
- DaveExeter 3y ago
  It's called signaling. You buy a $60K car to signal your wealth. It's why women buy $6K handbags.
- Tagbert 3y ago
  You bought them used. That is a different market and price structure. Most cars lose value drastically in the first year of ownership.
  - MisterBastahrd 3y ago
    Same exact market. I'm just not particular about whether the car is brand new or not, because I only need the following: Android auto, air conditioning, cruise control. Some of the other features like the rear camera are standard, and it's also got heated seats as a plus. In 2020 I was involved in a rearend accident, but I didn't think much of it because my car was still drivable even though I couldn't use the back door. Insurance company said they were just gonna cut me a random check if I didn't bring the car in to the shop. Apparently there was frame damage at very rear driver side which totaled the vehicle. So I was in a scramble to buy another car. I had multiple options, both new and used, but my rental was a Mitsubishi Outlander Sport. Loved that car. Anyway, when I set out that morning to buy a new car, I was looking for a NEW car. Talked to a dealership about a $33K special edition SUV with all the bells and whistles. Special color, moon roof, etc. But along the way, I saw a used car dealership and pulled in when I saw they had a bunch of SUVs in the lot. They had the exact same make, model, and color as the car I was driving. I don't do a lot of driving. The car had every single feature I wanted and low miles. So when they told me the price, it was a no-brainer. Picked it up the very next day.

Rapzid 3y ago

Woooahhhh 50k average? It's never crossed my mind to pay that much. Most of my friends don't own vehicles they paid more than 30k for and that includes a bunch of well-off software engineers. What's the median or if they exclude top 10% of earners? Edit: For a few years now the Chevy Bolt would be the EV I would get if in the market. Ford has nothing comparable but they are, supposedly, thinking about bringing back the Fiesta as an EV. A brand new Bolt can be had for mid 20s.

inconceivable 3y ago
this really should be split among people who have kids vs. not. once people have kids the budget goes up for a lot of different reasons.
_ea1k 3y ago
Not long ago, the price crossed $30k. I was surprised. It seems that it has moved past $50k only in the past few years. TBH, I'm shocked that the average is so high.
- KallDrexx 3y ago
  The average is rising because dealers are pushing auto loans much longer than the previously usual 5 years. They are feeding people's lack of financial literacy with 7-8 year loans under the idea that you can buy a more expensive car while only focusing on the monthly payment.
  - _ea1k 3y ago
    A shocking number of people really only look at the payment. You aren't wrong... sigh.

martin8412 3y ago

EVs are a luxury good. The most popular affordable car is around 13k EUR in the EU from new. There are no comparable EVs in the same price range.

_nhynes 3y ago
Is that the Dacia Sandero? The VW Up! (not Golf, my mistake) is ~15k EUR. My knowledge cutoff transitively only goes up to 2021, so I can't be sure which one you mean, but I am curious.
- bakje 3y ago
  Where is the VW Golf 15k EUR? I bought an 8 year old Golf with over 100k km over 2 years ago and paid around 12k EUR for it, new it was around 32k. For context this is in the Netherlands, I do believe cars are a bit more expensive here but I can't believe a new Golf would cost 15k anywhere. To be clear I'm not calling you a liar or anything, I'm genuinely curious if there are such major discrepancies between countries.
  - _nhynes 3y ago
    Ah, thanks for catching that. On the website (https://www.volkswagen.co.uk/en/configurator.html https://www.volkswagen.co.uk/en/configurator.html) I read "up!" as "Golf" for some reason. Indeed the Golf is about the price you quoted.
- martin8412 3y ago
  Dacia Sandero indeed. Golf starts at around 30k.
- WorldMaker 3y ago
  Doesn't the Dacia Spring prove that they can do a "non-luxury" EV? It's not that much more expensive than the Sandero.
CameronNemo 3y ago
Cars in general are a luxury.

Thoeu388 3y ago

[dead]

wmf 3y ago

Original source: https://prospect.org/economy/2023-07-31-ford-electric-cars-arent-affordable/ https://prospect.org/economy/2023-07-31-ford-electric-cars-a...

deleted 3y ago

[deleted]

westcort 3y ago

Copper reserves are insufficient to manufacture even the first generation of EVs.[0] The decarbonized economy will require horses and bicycles (both net zero emissions). The good news is that reducing solar intensity by 2% would compensate for a doubling in CO2 levels, however (see Manabe and Wetherald 1975).[1,2] I hope governments will not wait too long to act. If a solar shield is not implemented within the next 20 to 30 years, the opportunity to do so may close as a result of generalized collapse. [0] https://press.spglobal.com/2022-07-14-Looming-Copper-Supply-Shortfalls-Present-a-Challenge-to-Achieving-Net-Zero-2050-Goals,-S-P-Global-Study-Finds https://press.spglobal.com/2022-07-14-Looming-Copper-Supply-... [1] http://faculty.eas.ualberta.ca/jdwilson/EAS372_13/manabe75.pdf http://faculty.eas.ualberta.ca/jdwilson/EAS372_13/manabe75.p... [2] https://www.researchgate.net/profile/Syukuro-Manabe-2/publication/234326505_The_Effects_of_Changing_the_Solar_Constant_on_the_Climate_of_a_General_Circulation_Model/links/5682a20308ae19758391a63b/The-Effects-of-Changing-the-Solar-Constant-on-the-Climate-of-a-General-Circulation-Model.pdf https://www.researchgate.net/profile/Syukuro-Manabe-2/public...

TradingPlaces 3y ago

This is backwards. Vehicle quality has gotten much better, and that means used vehicle quality has gotten much better. Since about 2012, used vehicles have taken over the low end of sales, and now manufacturers in the US are beginning to cede that market to used. For the price of a subcompact, you can get a pickup or SUV with low miles, and Americans prefer larger cars. That’s why average new car price is so high. https://fred.stlouisfed.org/graph/fredgraph.png?g=17uXw https://fred.stlouisfed.org/graph/fredgraph.png?g=17uXw https://seekingalpha.com/instablog/49663329-trading-places-research/5874921-why-new-cars-are-expensive-in-us https://seekingalpha.com/instablog/49663329-trading-places-r...

jscipione 3y ago

CEO Henry Ford was sued by his shareholders for paying his employees a dividend to be able to afford a vehicle. The shareholders won. https://corpgov.law.harvard.edu/2021/12/01/dodge-v-ford-what-happened-and-why/ https://corpgov.law.harvard.edu/2021/12/01/dodge-v-ford-what...

johnea 3y ago

This is a beautiful example of history repeating itself. In the 1960's Japanese cars started to replace the overpriced, low reliability US "Big-3" automakers. Now, after dacades in theUS, the Japanese makers are also slaves to the LUXURY product. They can't imaging selling a vehicle for less than $50K. In China, an EV "city car" can be bought for < $10K, fully equiped EVs are < $30K. The US is rpie for these lower cost, higher reliability vehicles, but it seems this time it won't be Japan thats inovating. After decades of using the cheap Chinese labor force now US industrialists are afraid of the monster they've created, thus the cold war...

WheelsAtLarge 3y ago

If the premise was right then it would mean that the workforce wouldn't even be able to afford gas powered cars either. We know they can afford gas powered cars. Increasing incomes will only make it harder for people to afford EVs. It's a self defeating process. The reason EV's aren't affordable is because batteries and the overall EV manufacturing process has not yet achieved economies of scale. Gas powered cars have many more parts and require more labor to create. The reason they are less expensive is that manufacturers have squeezed out most inefficiencies out of the system including outsize profits. Give EVs time and we'll see them stabilize at a price that most workers can afford. The last thing Ford and such companies want is to make a product only the rich can afford. As vital patents expire and more competitors become part of the manufacturing process we'll see prices come down to a price that's reasonable versus people's income. We have seen it with Tesla. 20 years ago only the very rich could afford Tesla's first car. Recently they introduce a somewhat affordable car. Affordability will continue. Believe in the process, it's just a matter of time.