Time magazine wrote an article this week, The Price of Hybrid and Electric Cars is Plummeting. Here’s Why. The article explains the dramatic price cuts of hybrid and electric vehicles: lower gas prices have forced automakers to lower their price on EV’s as sales have continued to decrease since 2013. Ford is reducing the price of its Focus Electric from $35,995 to $29,995 due to poor sales and other automakers aren’t doing much better. In comparison, AAA Fuel Gauge Report listed the national average for a gallon of gas to be $2.10 this past Tuesday compared to $3.70 this past spring, making gasoline prices seemingly more affordable. The price cuts are necessary, because savings on gas has always been a major selling point for EV’s.
While cheap gas seems like a miracle for most vehicle owners, falling gas price has potentially dramatic consequences. NPR recently wrote an article, You’re Enjoying Low Gas Prices, But Is It Really A Good Sign? The author warns us that some economists “worry that that if energy prices were to keep sliding, the process could contribute to deflation— a brutal cycle of falling prices last seen in this country during the Great Depression of the 1930s.” In very simple terms, deflation could mean that businesses, homes, and investments lose their value. This economic viewpoint isn’t even taking into account the environmental and political dangers of the continued use of gas. Gasoline and oil are becoming harder and harder to extract in increasingly unstable areas, making extraction very expensive. Meanwhile, pollution from fossil fuels continues to contribute to the degradation of the planet’s health. Gas prices have become so ridiculously high in recent years that gas has started to lose its validity as an energy source for vehicles. However, cheap gas could mean restored faith in gasoline. That being said, the potential economic, political, and environmental consequences must be taken into consideration. Is gasoline really all that good of an option? Enter the (lower priced) electric vehicle.
Although this is a big blow for automakers, price cuts on EV’s could be a major incentive for buyers who have been interested in electric vehicles, but have been turned away by the high price tag. These individuals could finally purchase an EV at an affordable price and could fully reap the benefits once gas prices go back. Here’s to hoping that these price cuts do more good than harm for the electric vehicle market.