The Future of Electric Cars: What’s Holding Us Back?

Brogan is a contributor to the MarketWatch Guides team covering auto insurance news and trends.

Rashawn Mitchner is a MarketWatch Guides team editor with over 10 years of experience covering personal finance, loans, insurance and warranty topics.

If you’re a driver on today’s roads, you’ve likely come across a fair number of electric vehicles (EVs) — or you may even drive one yourself. It’s no secret that EVs have been steadily rising in popularity, with sales numbers speaking for themselves.

But why do many consumers still seem reluctant to purchase an electric car? We at the MarketWatch Guides team spoke with a panel of industry experts and average Americans to understand any potential resistance to EVs, and to figure out what it could take to turn the tide.

The International Energy Agency (IEA) found that global sales of EVs surpassed 10 million in 2022. Almost 1 million of these purchases were made in the U.S., which was a 57% increase over the previous year. Couple this with more than 53,000 public charging stations across the country and it’s clear that EV sales will continue to grow if people keep adopting these vehicles.

Richard Schwartz, a partner at Treacy & Company by Cherry Bekaert and one of our expert panelists, noted that with any new technology, “you’ve got early adopters [who] typically buy because they’re enthusiasts, and they see the technology as novel.” He said that these customers are usually “less price-conscious than the average consumer.” However, Schwartz believed that “the broader slice of the population is thinking a little more rationally about the price of these vehicles, which is coming down.”

A July 2023 study by Kelley Blue Book provides insight into just how far electric car prices have fallen, stating that the average price for an EV in June was down nearly 20% from its peak of $66,390 one year ago. The 2023 clean vehicle tax credit may also play a part in the average American’s willingness to purchase, as a new EV bought for personal use in 2023 may qualify for a tax credit of up to $7,500.

Despite this uptick in EV adoption and incentives from the government, many people still avoid electric cars. According to a 2023 study by the Energy Policy Institute at the University of Chicago, 47% of Americans are unlikely to get an EV as their next car. To dig into this hesitancy, our team questioned a panel of six auto industry experts and 13 consumers about their thoughts on EVs. While expert last names and titles are included, our panel of consumers agreed that they would like to be identified by first name only. Below, we’ll run through some of the key concerns mentioned by our panelists about electric vehicles.

Concerns about cost were widely discussed by experts and customers alike during our panel. The general consensus is that cost concerns play a huge role in EV adoption, or lack thereof.

Carl Anthony, managing editor of Automoblog, noted that “anything that is very technologically advanced is, generally speaking, expensive.” He continued by saying, “Consumers generally see cars as expensive anyway, and electrified [cars] are usually present under this umbrella of advanced technology. So naturally, consumers would view it as expensive — and for the time being, they are.”

Jodi, one of our customer panelists, said that her initial thoughts on EVs were that “there’s a level of inconvenience and expense, and neither one of those are appealing to me.”

Adam, another consumer panelist, stated that his concerns are also largely about expense. “My brother spent around $31,000 to $35,000 on his EV,” he said. “I think that the initial cost sometimes is too high for some people.”

Irina Tsukerman, the president of Scarab Rising and a member of the American Bar Association’s Environment, Energy and Resources Committee, made note of the general downturn in the economy as another reason for car owners choosing not to go green. She said that economic pressures are “causing Americans to buy fewer new cars and to hold onto the older cars longer, or to buy used cars when they do buy cars.”

To Tsukerman’s point, Travis Eckert, EV manager at MD Energy Advisors, noted that “another key factor is that the models with extended ranges, over 200 miles, are all relatively new. Though prices are coming down, they’re still not inexpensive compared to internal combustion counterparts.”

A general lack of knowledge about EVs seems to also exist among consumers. This dearth of understanding can breed concerns that in turn discourage broader adoption of electric cars.

Jodi, who drives a gas-powered vehicle, stated that “the biggest barrier for me is my lack of knowledge about how an electric vehicle could be beneficial.” However, this lack of deep understanding seems to be somewhat abated through word of mouth from current EV owners. Stephanie mentioned she heard from friends who own them that there is “more to owning one that I wasn’t initially aware of.”

Schwartz noted that if EVs are to be more widely adopted, education from automakers will be key to combating resistance. “Each of these concerns that we all hear from friends or folks in the industry can be rebutted with better education,” he said.

Tsukerman, however, argued that “it’s a mistake to treat this as a purely educational issue, because many serious investors in the automotive industry do their research very well before choosing to buy their vehicles.” While a lack of understanding is a contributing factor to EV hesitancy, it seems to be one piece of a much larger puzzle.

The convenience of gasoline over charging an electric car was another pain point brought up during the panel. The price of charging a vehicle versus filling up a gas tank doesn’t seem to sway consumers toward adopting EVs, despite charging being much cheaper.

Tsukerman stated that overall EV resistance “does have to do very much with calculating those costs [pertaining to] the convenience of charging [and] having to think about where you are going to charge your car.” Tsukerman noted that “if you’re a frequent traveler, for instance, it may not be very convenient because you are not always at home, and you have to find a charging station.”

Eckert mentioned that “upward of 80% of all charging sessions occur at home,” and that “having access to charging at home is a key driver for adoption but also a barrier to adoption.” Eckert stated that “those who live in a condominium or an apartment where there aren’t dedicated charging stations … that’s a challenge.”

Stephanie, one of the consumers on our panel, confirmed that her resistance to EV adoption stemmed largely from the long-distance travel that she often takes. “I’m frequently driving across states, and the thought of having to sit and wait for my car to recharge in comparison to pumping gas and getting back on the road weighs heavily on my mind.”

The growing number of electric cars across the U.S. inevitably creates the need for a robust charging network. However, the availability and convenience of these charging stations isn’t yet up to par, according to many EV experts.

Brian Grunkemeyer, the founder and CEO of FlexCharging, stressed the importance of EV charging being easy and accessible to all. “We now have charging networks in most places, but it’s still not quite enough,” he said. As a potential solution, he thought that “using the existing gasoline station network and adding EV chargers” could provide what drivers are looking for.

Grunkemeyer continued to say that he’s spoken with several people who considered buying EVs but chose not to. Their biggest issues were “around charger uptime.” And while he acknowledged that “Tesla’s supercharger network is highly available and reliable, that isn’t necessarily true for all the other charging networks.” He went on, “Imagine if you went to a gas station and three-fourths of the pumps didn’t work reliably. That’s what we’re facing right now with EV charging networks.”

It’s worth noting that this disconnect between Tesla’s supercharger network and other EV brands could be resolved if more manufacturers adopt Tesla’s North American Charging Standard (NACS). Ford, General Motors, Rivian, Volvo and Mercedes-Benz have already committed to the switch while Hyundai, Volkswagen and Stellantis are all in talks with Tesla.

Anthony DeOrsey, research manager at Cleantech Group, predicted that eventually a majority of charging will happen at home, whether at single-family or multifamily residences. “[Charging] at home is essentially what people are going to do. They’re going to charge overnight during off-peak hours for the most part.” DeOrsey said that “as the idea of charging at home becomes more mainstream, more understood … [this will be] a key factor to adoption.”

Concerns about the charging network typically stem from range anxiety — the fear that an EV could run out of power before its owner finds a charging point.

Anthony related range anxiety among consumers to the culture surrounding gas-powered vehicles in the U.S. “We know that a road trip can be done with a gasoline car … so some of the barrier to adoption is that we’re really up against all we’ve ever known for the last 120 or so years, and that is a very internal combustion-centric culture.”

Jodi and Cam from the consumer panel echoed concerns about driving range. “I feel there’s not sufficient sites for charging, and I wouldn’t ever want to get stuck,” said Jodi. She continued, “That is something that I’m always being told is possible. Or you have to sit at a charging station for 45 minutes. It’s that convenience factor.” Cam added that “even with the cost of fuel, [gas] stations are still readily available.”

To address the concerns of Americans like Jodi and Cam, President Joe Biden has made it a goal to build a network of 500,000 electric vehicle chargers across the U.S. However, only time will tell whether this lofty goal becomes a reality.

Despite this, drivers who purchase EVs may find that their anxiety abates over time. Matthew, a panelist who currently owns an EV, noted that “at first I was concerned about range [and] whether the battery would last long enough to go all the places that I needed to go. Charging time and cost were also concerns.” However, he said that since his purchase he’s “become a lot more comfortable with those things.”

The potential maintenance and repair costs of EVs can be off-putting to general consumers — and to their wallets during the current automotive technician shortage. Anthony noted that “all car repairs are expensive. That is just generally the way it goes. Whether or not electric vehicles will be more or less expensive [to maintain] is kind of relative when car repairs in general are expensive, no matter what you drive.”

Patrick McCann, the editor-in-chief of We Try Tires, shared a story about how Mercedes-Benz locked the hoods of its new EVs. Because of that, he says “you’re going to be forced to take it to Mercedes and pay dealer prices to have your car serviced. Or, when something goes wrong, you won’t be able to just fix it yourself.” Another issue, McCann said, is that EVs are “definitely cheaper and easier to maintain, until they go wrong … and when they go wrong, they’re going to be much more expensive.”

Stephanie shared that she finds “electrical repairs [to be] expensive, even on a gas-powered car. An all-electric vehicle,” she believed, “would be more expensive to repair outside of regular maintenance services.”

McCann agreed that the maintenance component of EV adoption is potentially off-putting. “It’s still a bit too early [to know] but it’s definitely going to turn people off … car enthusiasts and people who like to work on our cars.”

These issues around EV maintenance and repairs leave our team wondering whether there is a way to reduce repair costs that would make new and used EVs more appealing to skeptics.

Schwartz noted that there are lots of used Teslas on the market, conjecturing that “consumers would be apt to buy them if there was an extended warranty that says, ‘all of this risk of battery replacement isn’t on me.’”

Adam, a consumer panelist, agreed that an extended warranty or a guarantee on the battery could sway people to consider EVs. “If there’s a warranty for the battery, people will buy the EVs because they’ll be confident that if the battery breaks down, they’ll have that option.”

While key players in the EV industry like Tesla offer extended car warranties, there are also third-party extended warranty providers that offer comparable vehicle service contracts. As more consumers adopt EVs, there will likely be increased interest in these extended coverage options. As with anything else, it’s wise to perform careful research before committing to an extended warranty plan on an electric car.

If you attend college far away from home and have decided to bring your own car, driving it to school may involve hundreds or even thousands of miles. It may be better to save yourself the added stress and potential expenses by considering car shipping services.

If you’ve chosen a college campus that’s far away from home, driving your car to school will take careful planning. First off, calculate how long it will realistically take you to reach your college. Then factor in the cost of multiple tanks of gas, meals and lodging if applicable.

Along with saving you time and money, car shipping could reduce potential risk factors that come with long-distance drives. You’ll decrease wear and tear on your vehicle and will protect it from potential car accidents and mechanical breakdowns.

Consider all of these factors as you decide whether to ship a car or drive it. This will save you from being blindsided by the costs associated with either method of getting your car to campus. If you’re curious about auto transport methods, it’s worth learning about how to ship a car.

We’ve gathered quotes from a few of the top auto transport companies on the market to give you a ballpark estimate of what you could pay to ship a car. These quotes are for shipments from Philadelphia to San Francisco, which is about 2,900 miles. If you’re traveling a shorter distance you’ll likely pay significantly less than the amounts quoted below.

Anthony stressed the importance of consumer choice when it comes to vehicles. “Consumers like to have options. They also like to have availability. So if you take any product at all and you restrict the choices, consumers tend to push back.” For this reason, he believed that “if consumers perceive that all of the cars going forward are going to be autonomous or electrified, that’s where some of the pushback comes in.”

Anthony also noted that as with autonomous cars, customers feel pressured when they lose options. “It’s the same thing with electrification. [Consumers say] ‘It limits my choices. I still like an internal combustion engine, but would [like to] have the option for another type of powertrain, like hydrogen.’”

He finished off by stating that “if electrification is ultimately where we’re heading, there are some steps along the way for the consumer to help make that jump instead of going instantly from a gasoline vehicle right into an electrified one.”

What about hybrid vehicles — those that combine the power of gas with electricity? Do these vehicles share the skepticism that EVs receive, or could they be the stepping stone to full electrification? We posed this question exclusively to our consumer panel.

Matthew shared that he was looking for and bought a hybrid before his current electric car. “I was concerned about range and charging at that point, so I went with the plug-in hybrid. You get some benefit from better gas mileage … if you’re concerned about an EV.”

Jodi echoed the sentiments about hybrids being more appealing, “especially for a first sort of venture into that category.”

As someone who drives frequently over long distances, Stephanie agreed on the appeal, saying that “I wouldn’t have to rely on charging with a hybrid, and I could still do my long road trips without any added time.”

It’s clear that despite some lingering hesitancy to adopt EVs, they’re here to stay. “People like them,” McCann said. “I have enjoyed driving electric cars myself. Would I own one? No, not quite, not yet … and I’m sure there are plenty of people who feel the same.”

DeOrsey predicted that there would soon be a broader electrification trend as a whole. He noted that “if you look at things like people swapping out gas boilers for heat pumps and … look at [the] adoption of electrification in homes … I think ultimately, people are going to start to view EVs and the management of them long term as part of their energy portfolio.”

Many issues, such as cost concerns and charging network availability, are currently being resolved. However, only time will tell how quickly EV hesitancy shrinks among the public. Schwartz echoed these sentiments, saying that adoption “is going to take time. It is a journey, but what an exciting time to be a part of the industry and have discussions like these.”