Should I buy an electric car now or wait? The pros and cons explained

Should I buy an electric car now or wait? The pros and cons explained

Are you facing this modern dilemma? Should I buy an electric car now or wait. You want to be environmentally responsible – but you’re not sure about the practicality of a fully electric car? Perhaps you should wait? Many people do not believe that their individual efforts will make much difference. Alternatively, they think eco-friendly purchasing decisions mean financial sacrifice and will impact the family budget.

The most recent figures show that car sales are falling, but sales of electric cars are on the increase. In fact, one in 10 new car sales in October 2019 was battery powered. Hybrids are the most popular option, ahead of all-electric sales.

Who knows when, or if, the tipping point will be reached? If you own a car, at some point you will be faced with replacing it. What’s it going to be – all-electric, a hybrid, petrol or diesel?

Making the wrong decision could prove to be an expensive mistake. On the other hand, there could be large financial and emotional dividends from getting it right.

What are the choices?

In October 2019, the sale of diesel cars fell for the 31st straight month in a row. They still account for 25% of car sales, but the trend looks ominous.

Petrol is thought to be a safe and reliable option. But there is political pressure on the horizon for a greener approach to motoring. Penalties could be imposed by central government. Larger cities are considering clean-air zones. Sales of petrol cars are down over 3%.

Fleet and business cars account for about 55% of all sales. Shareholders may pressure leasing companies to adopt greener policies and employees may have little choice regarding their company cars.

Fossil-fuel cars, then, are already on long-term notice to quit. Governments around the world have set timetables to eradicate them. According to MPs on the Parliamentary Energy and Climate Change Committee, advancements in electric vehicles will mean traditional-fuel-powered vehicles will probably be banned by 2030.

Target dates for ending the sale of new petrol and diesel cars

Year Countries
2025 Norway
2030 Iceland  Ireland  Israel  Slovenia  Netherlands
2035 Denmark
2040 UK  Sri Lanka  Spain  Portugal  France  Canada
2050 Costa Rica
Source IAE/BBC Briefing

Bridging the gap is the hybrid. Hybrids offer an appealing blend of efficiency, range, power and low emissions, and they’re an ideal halfway mark between a conventional car and a fully-electric car.

If most of your driving consists of short, local trips, the electric motor does all the work. The fossil-fuel engine, meanwhile, will do the heavy lifting for any summer vacations to Cornwall or the Scottish Highlands.

There are other advantages: for instance, you will avoid the (typically) higher purchase price of an all-electric car and potentially benefit from less-expensive company-car tax, London’s Ultra Low Emission Zone charges, more favourable vehicle-excise duty and lower Congestion Charge tolls – especially if you live in London.

During acceleration, when fossil-fuel consumption is high, the electric battery can save you money.

What’s a PHEV? It’s a plug-in, hybrid electric vehicle. A normal three-pin socket in your garage is enough. Their electric-only range is typically in the 30- to 40-mile distance. Admittedly, this is less than a purely electric vehicle would achieve.

According to the RAC, hybrids use up to 30% less fuel than conventional engines. Beware those longer journeys, however, because the battery makes the car heavier, and conventional fuel consumption increases.

Hybrids and PHEVs could cost up to 20% more than a conventional car, so shop around carefully. Any extra initial costs could be recouped because research suggests they hold their value well.

The final option is the all-electric one.

The five challenges of all-electric cars

1. Being too early

With cars, as with other consumer items, the early adopter can enjoy the thrill of being first in the queue. Electric cars may be lovely to look at and a great topic of conversation. But soon enough, reality kicks in. There could be too few charging points in your area or on your commute. And supposing your battery starts to run down during a long journey?

The government gets huge tax revenues from fuel taxes, so early adopters may be on the wrong side of the tax argument. And there is almost no market yet for used electric cars.

2. Limited choice

What are you after? Sports car, SUV, town car, van? Guess what? The current choice of electric cars is limited.

Prices are at the upper end of the market, so they’re also tough on the wallet.

3. Backing the winner

Which technology will win out? Older readers who had video recorders at home will remember the contest between Betamax and VHS. There was only one winner.

Making a mistake now could be costly in the long-term. Various companies are currently vying with each other to develop the lightest and most powerful new batteries.

4. Technology infrastructure

What if you live in a block of flats without charging points in the car park? Or you don’t have your own parking space near home? In this case, where exactly will you charge?

If you live in a rural area, waiting for the local authority to put a charger in every lamp post could take forever. Induction pads in major roads could take decades to develop.

5. It’s not truly carbon neutral

Where does the electricity come from that charges your electric car? Possibly a fossil-fuel or nuclear power station. Renewable energy is hovering at the 50% supply level in the UK.

Where and how are the cars made? What about the production of the minerals that your battery needs, let alone their safe disposal later?

Fact Check

There are 8,400 petrol stations in the UK. Each one of them will have several pumps, with a total of 68,000. Source: Petrol Retailers Association.

There are 25,000+ car charging points in the UK (the equivalent of a pump) in 15,500 charging points (stations). Source: Zapmap. You can find them here.

Rapid Charge Units (50kW) can charge a battery to 80% in under half an hour. A Fast Charge Unit is 7kW to 22kW. A full charge takes up to four hours. The Slow Charge is up to 3kW using your home 3-pin plug. It gives a trickle charge and is mostly used for overnight charging.

Once you own an EV (electric vehicle) the running costs are low (Source: podpoint).

EV Battery power Range Charge cost Cost per mile
Nissan Leaf 40kWh 150 miles £5.60 3.7p
Tesla S 100D 100kWh 320 miles £14 4.4p

Compared with a fossil-fuel vehicle (according to Cap HPI) it costs 23% less to maintain and service an electric car. On the other hand, batteries in electric cars last on average 10 years before they need replacing. A Tesla battery, for example, can cost £25,000 when it eventually needs changing.

Owning a car is a major item of expenditure. You have to consider fuel, depreciation and running costs as well as the initial outlay. Your heart may make the choice, but your head will have to figure out how to fund it later on.

If you need a level-headed second opinion before you make the leap, contact one of our experienced financial planners here.

 

Be the first to know