Chevy Volt, Electric Cars Not Ready Yet
The Chevy Volt. The commercials make it sound like owning one is really exciting and makes a great case on saving gas. You could be running all over the place not using a drop of fossil fuel. Driving for free, sticking it to big oil, living the dream, saving the environment, you could even save enough on gas to go to Hawaii. As the overly-excited hippie granola girl in one commercial states, "It's totally awesome," right?
It may be awesome, if you're rich and you don't mind that driving without gas will cost you as much as driving with it. You're paying $39,000 plus for those cars, and, assuming 5 percent sales tax, about $1,950 in tax, plus dealer fees that are likely to be $200 to $500. So that's $41,150. Then, there's the financing. If you're lucky, you could get 0%, but let's say put $10,000 down and even get $2,000 for your trade in -- very good start -- and get a nice 4% for five years. Put these numbers into Kelly Blue Book's payment calculator, and you get a total cost of $43,989.50 and a monthly payment of about $533.
Let's think about that. If you can afford that much for a car, spending $300 to $500 a month for gas shouldn't hurt you and you should be able to afford a trip to Hawaii on your own. You'd come out cheaper than the $533 monthly payment for the Volt, and you''ll have more fun with a luxury car. For $533 a month, there are plenty of fine Mercedes, Lexuses and BMWs out there. I'm sure the Volt is a nice car, but it's not luxury.
To be fair, I don't think many people of average income are out there buying Volts at all, much less to save money, but you wouldn't get that from the commercials. Because of it's price, it's essentially a luxury car, even if it isn't truly luxury. But, for the sake of argument, let me further illustrate why you won't be saving money. Call the average SUV $25,000 to be conservative. That's $14,000 to $15,000 you save off the Volt sticker price already, more than enough for a nice trip to Hawaii. If you actually had that cash, you could also cut your financed amount in half on the $25k, getting a steal. Also, $15k is about three years worth of gas if you spend $500 a month, which is a bit high, so at the minimum it'd take you 30 months for the extra $15k investment to pay for itself. During those three years, you'll have paid somewhere around 4% interest on that $15k, which is another $1,800 just on the $15k, or about three months of gas wasted. You'll also have spent a lot on insurance (possibly more than on a non-electric), and repairs and maintenance. With Chevy trying to lure people of average income into these cars, the high payments alone could drive the economy into recession.
The more miles you drive the Volt, the more gas you save and the better off you are, right? If it were a guaranteed money saver, everyone would be doing it. If you drive enough miles to make the Volt seem worthwhile, say 100 a day, you're putting on a lot of wear and tear. I know, since my wife puts on a similar amount. Three years after buying a brand new car, we have 86,000 miles and have fixed a water pump, ball joint, put on new tires, sparks and aligned the front end at least twice. The Volt won't be any more reliable than what we have, and if something does go wrong with the electrical end, the cost to repair could be astronomical, as those parts aren't common. More miles saves you a lot of gas, but not necessarily money.
In short, the total cost to own the Volt will be more than you could ever recover just by not using gas. As one of my friends put it, gas would have to be about $7 per gallon just to break even, and even those prices are several years down the road. That's why these cars are priced so much higher. If they wanted you to save money, they'd make hybrid and standard cars equal. This is the same pricing principal at work with all energy-efficient appliances. They cost more and promise to pay for themselves, but, as is the case for windows, for example, by the time they do pay for themselves, they're ready for replacement and you'll have to spend the money all over again. The Volt is little different. I'm not convinced it's possible within the realm of physics and math for the Volt to actually pay for itself or for you to save enough money to go to Hawaii (give me a break), but even if it were possible in theory, in practice you'll never experience that.
So go buy your Volt, but don't buy it because you're saving money. Buy it because you want to reduce the use of fossil fuels. You're wasting $15k without batting an eye, and that's before you leave the lot. This is truly an exciting time for technology, and it's cool that cars like the Tesla and Volt can get you around in style without gas. But as of 2012 it's only an expensive novelty. There's a lot more car for the money out there.
