Cars: Do electric cars make financial sense?

Electric cars are a mixed bag, said Erik Sherman in CBS.com. “Replacing fossil fuel cars with electric vehicles should make sense,” but for several reasons plug-ins aren’t catching on as fast as they should. The biggest reason is price. Electric cars can cost anywhere between $40,000 for a Chevrolet Volt to $100,000 for a Fisker Karma, compared with around $30,000 on average for a new conventional car. Electric cars can also be inconvenient because they can’t go as far on a charge as conventional cars can on a full tank of gas—a drawback exacerbated by a dearth of charging stations. “One of the moves that made petroleum-based automobiles popular was the building of fuel stations all over the country,” which allowed drivers to refuel and avoid getting stranded. “People driving any electric car need to be able to plug in wherever they are.”

Charging stations are proliferating, said Justin Doom in Businessweek.com. There are now nearly 15,000 across the U.S., and 40 percent of them are open to the public. “The biggest frustration for drivers is that the industry lacks a universal payments platform.” Drivers pay commercial recharging stations with cards embedded with radio-frequency chips, but need a different card for each network. Some companies are combining their networks, but carmakers Nissan and Tesla are keeping theirs to themselves. Tesla, for example, plans to build a nationwide network of “Superchargers,” which would be free for drivers of its cars but off-limits to other electric-vehicle owners. That fragmentation hurts drivers of the country’s estimated 100,000 electric vehicles. “It’s not a good experience for anybody,” said Andrew Hudgins of the Department of Energy’s Clean Cities program. “It’s going to curtail growth.”

Still, there are big financial incentives for getting a plug-in car, said Susanna Kim in ABCNews.com. Purchasers are eligible for a federal tax credit of up to $7,500, depending on the car’s battery capacity; even if you don’t owe that much in taxes, some dealers will write off the whole amount. And depending on where you live, you might be eligible for additional state tax credits. Georgia, for example, offers an income tax credit to people who buy or lease a new zero-emissions vehicle, saving them 20 percent of the vehicle cost, up to $5,000. At this point it’s more prudent to lease than to buy, said Edmunds.com analyst John O’Dell: “Batteries have a finite life, and no one yet knows what it is.”

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