The Finances of our Two Electric Vehicles
Purchasing brand new vehicles is generally not a wise decision. As I considered the value of the large rebates associated with purchasing new electric vehicles in the State of Colorado, however, I decided purchasing 2 new electric vehicles in 2018 was the right decision for our family. Spending extra money to save a little money is not always smart, but it worked out well for us with these purchases.
My Honda Clarity had a total price of $37,423 (including sales tax and handling/delivery charge). We received $4,109 from trading in our old Honda Odyssey with 175,000 miles on it. Honda financial services also paid $500 towards the purchase so the final purchase price was $32,814. Subtract the federal and state tax credits equal to $12,500 and the cost of the vehicle was $20,314.
Lisa’s Chrysler Pacifica had a total price of $49,449 (including sales tax, other fees, and $2,185 for a 7 year Vehicle Protection Plan). Subtract the federal and state tax credits equal to $12,500 and the cost of the vehicle was $36,949.
What was our gas mileage for the first 12 months of driving each of these cars?
Honda Clarity
Total Miles - 16,340
Total money spent on gas - $429.80
Average cost of gas per gallon - $2.50
Total gallons purchased - 172 gallons
95 miles per gallon
Chrysler Pacifica
Total Miles - 21,590
Total money spent on gas - $1,712.19
Average cost of gas per gallon - $2.50
Total gallons purchased - 685 gallons
31.5 miles per gallon
My Honda Clarity is so much more efficient than the Chrysler Pacifica because it is typically only used for my daily commute, then plugged in overnight to get it back to a full charge. Lisa’s van, on the other hand, has a smaller electric only range, is used more frequently throughout the day with Lisa’s many errands, and is often not fully charged between each use. The biggest factor in the lower miles per gallon of the Pacifica, however, is the fact that we use this car so much on vacation, which almost entirely relies on the gas hybrid engine.
I actually think I will see an even higher efficiency of the Clarity now that I am no longer in the National Guard. My weekend spent in Denver every month was the biggest use of my fuel consumption by far. I will be evaluating my monthly efficiency and I anticipate extremely high numbers if I don’t have to drive to Denver on a regular basis and only have to drive to and from work.
The other thing that must be taken into consideration is the effect having these electric vehicles has had on our electric bill. For the six months from March through August in 2018, I spent $779.56 on our electric bill. For the same months in 2019, I spent $1,047.84 on our electric bill for a difference of $268.28. This data can be extrapolated to presume I spent about $536 more during the 12 months I had the 2 electric vehicles compared to the previous year. This does not take into account any increase in the cost of electricity or any increase in my use of electricity due to other factors (hotter summer and therefore more air conditioning for example). So I have spent on average $45 more every month on electricity since acquiring these 2 vehicles.
I know I have saved much more than $45 per month in my gas costs since making this change, however. Prior to September 2018, spending $300 per month on gas was a very good month and the monthly gas bill was commonly above $400 per month. Now our monthly gas bill is usually between $100 and $200. Bottom line, I am probably saving at least $200 per month in gas and spending about $45 more in electricity. That $155 in monthly savings certainly helps to justify the purchase of these cars. This equals $1,860 per year. Over a 7 year life span, that $155 per month is equal to $13,020. That is $6,500 per vehicle in energy savings.
Subtracting an additional $6,500 in energy savings from the Honda Clarity price of $20,314 after tax credits makes the price of the vehicle $13,814. If we drive the vehicle for 7 years with no retained value after the 7 years, the annual cost is equal to $1,973. The monthly cost would be $164.
Subtracting an additional $6,500 in energy savings from the Chrysler Pacifica price of $36,949 after tax credits makes the price of the vehicle $30,449. If we drive the vehicle for 7 years with no retained value after the 7 years, the annual cost is equal to $4,350. The monthly cost would be $362.
Obviously the cost per month and per year would decrease even more if we drive these cars for longer than 7 years or if there is residual value after 7 years, like I am sure there will be.