Rising Gas Prices Spark Debate on Electric Vehicles
U.S. consumers are facing a significant increase in gasoline prices, which has led to a growing conversation about whether electric vehicles (EVs) are the right choice for them. The national average price for a gallon of regular gasoline has risen nearly 30 cents in the past week, reaching $4.43 per gallon according to AAA. This increase is expected to continue as the Strait of Hormuz remains closed, further impacting global oil supply.
According to a recent ABC News/Washington Post/Ipsos poll, 15% of U.S. consumers are considering purchasing an EV due to high gas prices. Robby DeGraff, manager of product and consumer insights at AutoPacific, believes now is an ideal time for consumers to trade in their vehicles for an EV, especially if they are looking at models that have recently come off a lease.
“You can find a gently used, newer Chevrolet Bolt, Nissan Leaf or even a Tesla Model 3 for not a lot of money,” he said. “Upping one’s budget even slightly brings you into used Hyundai Ioniq 5, Kia EV6, Ford Mustang Mach-E, all of which are just enticingly strong products.”
DeGraff noted that drastic swings in gas prices have historically influenced motorists to seek out more fuel-efficient vehicles. “In the past, whenever we’ve seen a major geopolitical event that spikes gas prices, there are two common consumer behaviors: downgrading to a different vehicle segment — something smaller, more efficient, more cost-effective — and changing over to a cleaner alternative powertrain,” he explained. “The jump we’ve seen that really triggers powertrain consideration is a $2-per-gallon increase from where gas is it at now.”
With the expiration of the federal EV tax credit, consumers will likely have to pay the full MSRP of a new EV. Additionally, deals and discounts on EVs are becoming harder to find, as automakers have significantly reduced inventory since last fall. Some brands are even shifting production away from EVs entirely.
Tesla, the top seller of EVs in the U.S., is offering 0% APR on its popular Model Y model. Lucid, which makes the high-end electric Air sedan, is advertising 0.99% APR for 60 months. Tyson Jominy, vice president of data and analytics at J.D. Power, stated that “it’s life or death for Tesla… the company needs inventory on hand.” He added that Tesla does not have an internal combustion engine (ICE) portfolio to fall back on.
Jominy pointed out that new EV inventory is down 80,000 units from a year ago. While used electrics may be cheaper, many are not equipped with the NACS charging port, which has become an industry standard. “The challenge with EVs remains the same — they’re not for everyone, they’re not for people who drive long distances or rent [a home],” he said.
He recommended that consumers keep their current vehicles and ride out the price fluctuations. “A trigger point for a new car should not be fuel economy,” he said. Ivan Drury, director of consumer insights at Edmunds, agreed with this view, arguing that fuel economy should not be the only reason for buying a new car.
“If you’re shopping purely on fuel economy, you could end up with something that doesn’t work for your lifestyle,” he told ABC News. These high gas prices have “people thinking about EVs again,” he said, adding that prices at the pump haven’t translated into a ton of sales yet. “Just a lot window shopping of EVs,” he said, adding, “The $7,500 federal credit super-charged sales.”
Like DeGraff, Drury said used EVs are consumers’ best bet; some older models are 40% to 60% cheaper than the original MSRP. According to Drury, the average transaction price of a new EV in the first quarter of 2026 was $57,099 compared to $31,153 for a 3-year-old EV. “The used market is where people should be looking,” he said. And worries over a used EV’s battery are unwarranted, he argued. “Studies show the batteries last longer and EVs have an eight-year/100,000 mile warranty,” he said.
Columbia Business School professor Gernot Wagner said more Americans will ultimately adopt EVs despite the roadblocks that are hindering ownership. “The current U.S. government doesn’t exactly make it easy,” he told ABC News. “We have all but priced the cheapest EVs out of the market, in an attempt to protect domestic car makers. Charging infrastructure is still lagging behind most of Europe, China, and elsewhere. All of these barriers, of course, are just temporary.”
He went on, “It’s clear that EVs are the more efficient, better, and increasingly cheaper technology. And technologies, by their very nature, can only get even better and cheaper over time.”
If gas prices stay elevated for more than a year, consumers may finally have no choice but to look for alternatives. “Price pressure influences decisions most when it lasts long enough to intersect with a natural replacement trigger — a lease expiration, an aging vehicle, or rising maintenance costs,” she told ABC News. “Weekly data show that EV shopping interest increased week over week in mid-April, with the week ending April 19 marking the highest EV shopping level year-to-date. That said, the pattern still looks like short-term curiosity rather than a step-change in buying intent.”
She added, “With consumer confidence under pressure, many households that don’t need to purchase will continue to wait.”
