High EV Price Tags Are Top Barrier for Purchase, but Battery Issues Are Also Driving Away Many Holdouts

Electric vehicles are becoming increasingly common, as are the charging stations that come along with them, but the price tag for an EV is still keeping many consumers away from purchasing one in the coming years.

Among U.S. adults who said they are unlikely to buy an EV or hybrid in the next decade, 64% said a major reason why is that they believe the vehicles are too expensive, an increase of 8 percentage points since January 2021, according to a new Morning Consult survey. Over that two-year period, price has emerged as the top reason for why EV holdouts haven’t purchased one, despite some recent price cuts in the industry. 

Tesla Inc. and Ford Motor Co. have both slashed prices, others are waiting out a price war, and Toyota Motor Corp. has shuffled its executive leadership to hone in on EVs. Meanwhile, the price of used EVs has dropped substantially.

Automakers have gotten a temporary helping hand from the Treasury Department, which has delayed the rollout of battery sourcing regulations for EV tax credits until this month, giving manufacturers extra time to figure out how they will meet the domestic requirements. Additionally, the Treasury decided to make more sport-utility vehicles eligible for the tax credits, extending it to a handful of SUVs that had been priced out of the $55,000 upper limit for sedans and wagons.

Battery fires, cold weather performance pop up as major issues for many EV holdouts 

While high prices have long been an issue for EV purchases, recent reports of EV battery fires and issues related to colder weather have made it onto the list of major reasons why many adults are not interested in purchasing an EV or hybrid, with almost half of holdouts saying they had concerns. 

Ford suspended the production and delivery of its F-150 Lightning last month after a model caught fire during a pre-delivery quality inspection, spreading to a nearby truck. Similar reports have circulated about Tesla batteries catching fire, sometimes “spontaneously.” 

Despite the concern, data from referral service AutoinsuranceEZ found 25.1 fires per 100,000 sales of EVs compared with 1,529.9 fires per 100,000 sales of gasoline-powered vehicles. The number was highest for hybrids, with 3,474.5 fires per 100,000 sales. 

“I think one of the things that you see is that when we get a new technology, the safety concerns pop up,” said Haresh Kamath, director of distributed energy resources and energy storage at EPRI, the Electric Power Research Institute.

While the incidents are relatively rare, they are important and must be taken seriously, he added. There is not one general reason for the battery fires, as it depends on the specific instance. 

“What we can say is that we've learned a great deal the last few years,” Kamath said. “And even in those circumstances where we don't know what the causes are, we have some confidence that we can prevent the worst effects of these fires from occurring so that the overall product is safer.”

The industry has been reaching out to first responders more recently, with a great deal of information coming from the automakers and manufacturers about the risks and how to address the fires when they happen.

A spokesperson for the National Fire Protection Association said that “EVs are inherently no more dangerous than internal combustion engine vehicles from a fire safety perspective. However, behavior and characteristics of EV fires differ from ICE incidents and present unique challenges to first responders. 

“While EV fires appear to be a less common occurrence, statistical data on the frequency of EV fires is needed. However, EVs are more complicated of an event for responders since these fires can last longer and have the potential for electrical shock and reignition,” the NFPA added. 

In the meantime, the National Highway Traffic Safety Administration is working on a rulemaking proposal that will include requirements for mitigating fires of electric vehicle batteries and considerations for emergency response guidance to first and second responders. 

In addition to battery fires, nearly half of EV holdouts cited major concerns about the potential for the battery to lose charge during colder weather. Across the United States, concern was highest in the Midwest, where slightly more than half of adults said they were concerned with cold starts (52%) and battery fires (51%). 

A December report from Recurrent Motors Inc. showed that some EVs can lose up to 35% of their range in freezing conditions, but the range loss varies depending on each model. Cold temperatures affect the chemical and physical reactions in the battery and EVs don’t produce “waste heat” like internal combustion engines do, the report noted, and that heat helps warm up the inside of the vehicle, whereas EVs must make their own heat, drawing energy from the battery and lowering the range.

More access to charging stations still needed for most EV holdouts

In addition to high prices and concerns about battery fires and cold weather performance, charging remains a primary concern for those who are not considering buying an EV or hybrid in the coming years. Roughly 3 in 5 said they’re concerned about needing to charge the vehicles too often or that it’s inconvenient to find charging stations.

EV holdouts also appear to still love their traditional cars: Preference for gas-powered vehicles grew between 2021 and 2023 by 6 points, with 60% citing it as a major reason why they were not interested in purchasing an EV or hybrid.

The survey also indicated how consumer attitudes on EVs could be swayed to increase purchasing likelihood. 

Almost 3 in 5 adults said they would consider purchasing an EV or hybrid over the next decade if money were no object and if there were plenty of charging stations nearby. A third of respondents said removing cost and charging issues still wouldn’t make them likely to buy an EV.

During the span of the two surveys, the Biden administration and the industry worked to expand access to more charging stations. After eight months of debate, the administration recently released national EV charger network rules requiring that chargers must be made in the United States, with 55% of their costs coming from domestically made components by 2024. 

In an effort to qualify for more subsidies under the Combined Charging System standard, Tesla committed to opening up part of its charging network to non-Tesla drivers. The company aims to offer 3,500 new and existing superchargers along highways and 4,000 slower chargers at hotels and restaurants. The initiative also includes commitments from General Motors Co., Ford and ChargePoint. 

BP PLC is also working to expand its existing fuel and charging network with a recent $1.3 billion purchase of TravelCenters of America Inc. The announcement came after BP said it would invest $1 billion to bring fast-charging points to more than a dozen cities in partnership with car rental agency Hertz Global Holdings Inc., with the ultimate goal of having more than 100,000 chargers globally by 2030.

But even with more charging station options in the future, almost half of adults who don’t own an EV said their budget for buying one would stay the same, while a quarter said they were not interested in an EV at any price. A smaller fraction of adults (16%) said they would spend more for an EV than a gas-powered vehicle if charging were plentiful, while another sliver (13%) said they would only be interested in an EV if it cost less than a gas-powered vehicle.