Posted on 15 October 2014.
When I add “self-driving” to “electric car”, you may envision a double-unicorn, but these beasts of legend are right around the corner, and they will be damn near free, assuming you can afford one.
Elon Musk has announced that “The Tesla car next year will probably be 90 percent capable of autopilot.” Cadillac will have their “hands & feet free” cruise control shortly thereafter. Nissan has repeated stated that they will have 100% autonomous vehicles by 2020. Remember, that’s only five years away.
An autonomous electric car would save you so much money it could easily pay for itself.
Let’s look at the 10-year cost of owning a new car
According to PlugInAmerica, the average cost for a gallon of regular gasoline in the US over the past three years was $3.53/gallon. By using 15,000 miles as the average amount of miles a person will drive in a year, the annual cost of gasoline for the average car will be $2,135 per year.
Conversely, the average cost of electricity in the US is 12 cents per kWh. Therefore the average person driving an average EV 15,000 miles per year pay about $540 per year to charge it.
SAVINGS: $1,595 per year. $15,950 over ten years.
Assuming you have a clean driving record, you can insure most vehicles with liability-only for about $750/year, with collision adding another $500. Comprehensive, the insurance that covers your damages if someone else hits you, is only a couple hundred.
Self-Driving cars have thus far proved to be extremely safe and highly unlikely to cause an accident. Google has already logged over 700,000 autonomous miles without causing an accident. This means that liability and collision insurance for self-driving cars will have substantially lower insurance premiums. Perhaps only 20% of the current rates.
SAVINGS: $1,000 per year. $12,000 over ten years.
Electric cars have fewer moving parts than an internal combustion vehicle. Think of the items that most commonly fail on cars, and you’ll find almost none of them on an electric car. In my 24-years of driving I’ve had maintenance and repairs like:
• Replace fuel pumps
• Replace a bad transmissions
• Replace a clutch
• Repair leaky, failing exhaust
• Oil changes
• Blown radiator
• Replace water pump (three different vehicles!)
• Blown head gasket
• Lost belts
• Replace timing chain
• Full system fluid flush
None of these things are required to repair or maintenance because these systems don’t even exist in an electric car. The cost of maintaining an electric car is estimated to be 1/3rd less than that of an internal combustion vehicle. So instead of $14,310 over the first eight years, it’s more like $9,444.
SAVINGS: $487 per year. $4,866 over ten years.
At this point, the question isn’t “how much does it cost” but rather, “how much is it worth?”
If you could get a self-driving, electric car that lasts 10-years for $15,950 (or $19,885, since many states exempt sales tax on electric vehicles and there is a federal tax credit of $2,500 toward the purchase of one,) it would literally become a zero cost car just from the savings in fuel prices.
If you could whack another $12,000 off on insurance premiums, that means you’d get a free ten-year car even if it cost $33,014.
And with the maintenance cost savings factored in, it would get you up to a retail purchase price of $38,269.
If I offered you a brand new gasoline powered car for FREE, or a brand new electic car or equal quality for $38,269, your ten year cost of ownership would be identical. They would both cost you the same. But gasoline cars are not free. They still cost serious money.
The cheapest cars on the market are around $15,000. A $15k gasoline car would cost the same over a ten year period as a $52,269 electric vehicle.
Batteries are expensive, there’s no getting around that. They are steadily coming down in price, and may see a huge dip once Tesla’s GigaFactory is running, but for now, let’s forget that. If a manufacturer could offer you a 100% electric, self-driving vehicle for less than $53,000, and you can afford it, you would be pennywise and a pound of dumbass if you didn’t take it.
The rich can afford to get richer
It still doesn’t pay to be broke. The rich get 0% financing, instead of the 582% charged by payday lenders in Idaho. Having money to keep in your bank account makes it a free service, as opposed to those who dip below zero and incur fees of $35 per transaction. The house I’ve purchased for $1,228/month couldn’t be rented for less than $1,550, and the luxury furniture I bought cash cost a fraction what a rent-to-own contract would give me for inferior furnishings at a place like Aarons.
This is, unfortunately, more of the same. If you can buy such a vehicle outright, or finance it on A+ terms, you’ll know upfront how much money you’re saving, or actually making on the deal. If you don’t qualify for the payments, even considering you’ll save easily half of your payment in gas, maintenance and insurance costs, you’re still going to be left out in the cold.