The new Porsche Taycan Turbo EV (electric vehicle) starts at $174,000, which is more than four times the average transaction price for a new car in Canada (about $38,000).
Yes, the Taycan is an EV for the gilded one per cent. And there are other high-priced, full-on battery cars, such as Tesla’s Model X ($116,090), as well as a range of plug-in hybrids such as Bentley’s Bentayga hybrid ($199,408) that are aimed at the rich and woke.
But don’t despair, middle-class EV shoppers. For every high-priced EV, you can find a battery car that lists for something close to the average $38,000 average transaction price in Canada.
Indeed, www.plugndrive.ca lists at least 18 sub-$50,000 fully electric and plug-in hybrid cars and SUVs for sale, including Volkswagen’s e-Golf ($37,895) and the Mini Cooper SE ($39,990). Moreover, living with an EV is what any middle-class driver would call “cheap, cheap, cheap.”
Consumer Reports, the American Automobile Association (AAA) and others report that EVs cost less to drive and maintain than old-fashioned internal combustion engine (ICE) cars. Yes, Nissan’s LEAF – the second best-selling EV of all time with more than 500,000 sold in the past decade – starts in Canada at $44,298 and will run you past $50,000 fees and taxes all-in, not including any government EV incentives.
But once you own or lease a LEAF, fuel costs are minimal and outlays on tires, maintenance and repairs are cut by more than half. According to CR, battery electrics cost around $0.012 per mile and PHEVs (plug-in hybrid electric vehicles) cost $0.028 per mile to operate (all figures in U.S. dollars). ICE cars on the other hand cost around $0.031 per mile to operate.
Perhaps even more important, battery cars of any sort are very cheap to repair: battery electric vehicles cost $0.043 per mile, PHEVs cost $0.033 per mile, and ICE vehicles cost $0.079 per mile between 160,000 and 320,000 km.
There is a dollars-and-cents case for owning an EV. That said, for the next 12-18 months a wave of pricy EVs aimed at the richest car buyers will get plenty of attention. Take the GMC Hummer EV from General Motors.
As Wedbush Securities analyst Dan Ives notes, it is a foundational model in GM’s $20 billion push into the EV space over the next five years. The first Hummer EVs, slated for production late next year, will list at roughly $113,000 – U.S. dollars, remember.
Yet GM is aiming to sell one million EVs a year across the U.S. and China within five years. Ives is among the analysts who like GM’s EV bet:
“In a nutshell, given its massive distribution, installed base, and EV R&D/battery framework, we believe GM has a strong opportunity to establish itself as a major player in the EV market over the next decade,” Ives writes in a recent note.
GM, in fact, has committed to 20 new electric vehicles by 2023, all across the Chevrolet, Cadillac, GMC, and Buick brands. GM’s EV platform strategy is based on five interchangeable drive units and three different motors from its Ultium Drive System platform.
Ives says GM is smart to jump into EVs in its biggest way yet, starting with a pickup truck for American buyers: “We believe the EV pickup opportunity will have multiple winners and ultimately opens up a new leg of growth for the US EV market starting in 2022,” writes Ives, also noting that Ford Motor is also pushing ahead with an EV version of the world’s best-selling pickup, the F-series.
Ford, of course, is also banking on the sex appeal of its Mustang Mach-E, a battery-powered crossover with sports car styling due later this year. The Mach-E is creates sizzle for Ford, while an all-electric version of its best-selling F-150 pickup in 2021 is the beef at the bottom line. Ford says it will push harder with EVs for its Lincoln brand and with its commercial vehicles, also.
Or consider Volkswagen AG, with plans to spend $66 billion on electrification projects in the next few years. VW has repeatedly vowed to become an EV world leader. By 2029, the VW group of brands plans to introduce 75 new EVs, including the ID.3 hatchback recently released in Europe, and the ID.4 crossover coming soon.
VW’s challenge, like other legacy car companies, is to manage the transition from gas-powered to all-electric. To help offset enormous EV investments, VW will devote plenty of energy to creating EV excitement by leveraging the power of its luxury brands, from Porsche to Audi. Likewise, GM has GMC Hummer and Cadillac. Ford will drive ahead with the F-Series EV because full-size pickups are now luxuriously priced. And so on.
So, for the next 12-18 months, look for legacy carmakers to emphasize EV entries from their premium brands, even as they highlight the low running costs and competitive sticker prices of mainstream cars, crossovers and SUVs.
After years of stop-and-starts, hollow promises and marginal commitments, the EV business is getting very real for the legacy car companies.