Americans Will Want Electric Cars When Gas Hits $5 Per Gallon (Or Maybe $4.50. No, Wait, Make That $7)

Everyone has a price. But Americans have a wide variety of answers when asked how much they would be willing to pay for gas before grudgingly switching to electric cars.

7 Eleven zero gas prices

It seems obvious enough: At some point, gasoline will get so expensive that gas-guzzling drivers of all stripes will consider purchasing electric cars. But how expensive does gas have to be before this happens? No one is really sure.

The most recent study on the subject comes from Harvard's Kennedy School, which predicts that significant market penetration of EVs will come when gas prices hit approximately $4.50 per gallon. This is the tipping point, the authors explain, because it will make EVs competitive across a wide range of features, including purchase, maintenance, and operations.

Fair enough. But a survey from Deloitte says that gas will have to reach $5 before EVs enter the mainstream. After interviewing 12,000 people worldwide (and over 1,000 people in the U.S.), Deloitte found that 78% of Americans surveyed would consider buying an EV if gas hit $5. But that's not all: over 50% of Americans won't pay a premium for EVs over their gas-powered counterparts. And over 77% of those surveyed expect to pay under $30,000.

The $4.50 to $5 tipping point range seems reasonable, but yet another study from Cargurus.com says that gas will have to reach $7 a gallon on average for some hybrid EVs to break even in cost compared to gasoline-powered vehicles. The Toyota Camry hybrid will become cost-competitive at $4 a gallon, but the Cadillac Escalade hybrid won't be competitive until gas prices hit $15 a gallon.

Then again, a recent Gallup poll found that 57% of Americans won't buy an EV no matter how high gas prices get. So maybe there isn't a tipping point at all.

[Image: Flickr user RevTimMedia]

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7 Comments

  • Electric

    When you ask makes all the difference. Ask when they have a good job and gas prices have been stable and the give a higher per gallon price before they would by an Electric Vehicle. They are comfortable.

    Ask them right when the oil companies arbitrarily raise the price of a barrel of oil (like around the holidays) then that number "how much" number gets smaller as consumers get fed up. Ford Motors said it was $3.50 during the 2008 gas price spike. 

    Here is the real truth. When people have a real choice of electric cars, sedans, sports cars, trucks, SUVs with pleasing body styles available to them they will buy electrics. You want proof of interest?  Check Google Analytics for search terms like "Electric car" You will see that searches for that term jump through the roof when gas prices unreasonable rise quickly. People are checking because they want out from under the thumb of "Big Oil". 1/2 of electric car owners are running for free on home solar panels.  Right now there are few electric car choices when 4 years ago there were none. Build them and they will buy.

  • JeffU

    Americans will want . . .  Cool cars, and those are electric. Quite and powerful.

    If you don't think so than you haven't driven one so you just don't know.

    People are buying plugin electric cars for the overall new and better driving experience they offer that gas cars can't compete with. Plus they don't use gas.

  • Kat Amsterdam

    Here in the Netherlands our fuel prices are on par with those of the UK currently us$10.17 per gallon. The incentives used here to get people to drive electric are: the gov't installs the electrical charging station at your home, and work, give free exclusive parking in the center of large cities with charging stations at the exclusive parking, and the cars are not taxed for road-tax  

  • tom jones

    I don't think gas prices has anything to do with it. If I could buy a electric  car at the same price as a gas one I would get one now. today, If not sooner.

  • Andrew Krause

    The price of gas is not what will drive people to electric cars. Americans put fuel economy somewhere near last place. They'll need to be convinced that electric cars provide the range (they don't - yet), the proven durability (almost there) and the performance (actually, they're far superior) of gasoline engines. Also, they will need to make electric cars across the full range of vehicle types. When even the burliest good ol' boy can get an electric truck, they will be successful. (And when they realize that an electric pick-em-up truck can put out far more torque at low range than a gas or diesel ever could, there will be no going back.)

  • Ben Drury

    UK is already at $10.10 per gallon and we're still driving petrol cars.  I think it'll go a lot higher than $7 before it tips the balance.