As the Biden administration spent the past four years aggressively pushing electric vehicles on America, their message in response to the exorbitant cost of EVs has been the price of EVs will eventually come down. But that is not happening, and now the Wall Street Journal calls an affordable American electric car a "withering dream."
Indeed, the average cost of an EV continues to hover around $60,000, and industry leaders are dousing any hope of that number coming down. Tesla CEO Elon Musk recently said producing a $25,000 model is "pointless" and "silly." Peter Rawlinson, CEO of Lucid Motors, put it even more directly on a recent podcast, saying of low-cost EVs, "that market sucks."
There are many factors at play in keeping EVs essentially a high-priced luxury item. One, the cost of all new cars is now higher than it has ever been. Two, the cost to produce EVs remains extremely high, making the profit margins extremely thin for automakers. And most importantly, there is still no mass market for EVs like other new technologies that became more affordable after becoming ubiquitous. Auto industry expert Mike Caudill recently told Fox Business the EV market hasn't really expanded beyond the hardcore early adopters. "Those people didn't care about what the prices were, they just wanted their Tesla, and they bought it," said Caudill. "The problem is those early adopters already have their electric vehicles, and now you're moving into mainstream America...they don't understand range, they don't want to understand range, they just like a good deal on a vehicle."
If the technology is in demand, the public will spend money on it, as evidenced by things like smart phones, 4K televisions, and Apple products. But that simply hasn't happened with EVs, and experts don't expect it to anytime soon. "You can throw the tax credits out the door, you can even throw the pricing out the door...you have to create an environment where consumers want to buy these cars," says Caudill. "And right now, they don't want to buy them because they don't understand them, and they're getting all of this EV stuff shoved down their throat."
Photo: Getty Images North America