The current cost to make plug-in vehicles is substantially higher than that of conventional vehicles, largely due to the cost of batteries. Depending on the price of electricity and gasoline, however, the energy cost to operate an all-electric car is in the range of 3 to 4 cents per mile, compared to about 8 to 16 cents per mile1 for a conventional gasoline-powered vehicle. So, lower operating costs can help to offset the higher initial purchase price of electric vehicles (EVs).
To develop next-generation electrification technologies and electrified vehicles, automakers and their suppliers will need to invest billions of dollars. In addition, utilities will need to invest to increase electricity generation and transmission capacity, with generally higher costs for green electricity sources. Governments will also need to invest by encouraging and facilitating the development of technology and infrastructure and providing incentives for consumers to buy EVs. At present, Ford is doing what it can to reduce the costs of manufacturing and operating EVs.
We have planned our electric vehicle strategy based on our highest-volume global platforms, which can help to reduce the costs of electric vehicles by creating economies of scale. For example, the Focus Electric, C-MAX Hybrid and C-MAX Energi plug-in hybrid are all based on our global C-platform, which we expect to underpin 2 million vehicles annually.
We are using best-in-class flexible manufacturing technology in our Michigan Assembly Plant, which produces the Focus Electric, C-MAX Hybrid and C-MAX Energi, as well as the gas-powered Focus. Flexible manufacturing allows us to switch production between different vehicles to meet changing customer demand without retooling our plant or assembly lines – a significant cost reduction. This is important in helping us respond nimbly to a changing market.
Ford is working with a range of battery suppliers and other partners to develop next-generation battery technologies that will help to bring costs down. Please see the Battery Technology section for more information on advanced batteries for EVs.
The fuel costs of battery electric vehicles (BEVs) are significantly lower than for gasoline-powered vehicles. EVs require less energy to move a given distance, compared to conventional gas-powered vehicles. The average price for residential electricity in the U.S. is about 12 cents per kilowatt-hour. The fuel cost to travel 80 miles in a Focus Electric with a combined fuel economy of 105 MPGe is about $3. Driving 80 miles in a highly fuel-efficient, competitive gasoline-powered vehicle that gets 40 mpg would cost about $8 (assuming $4 per gallon of gasoline) – over three times more than the EV. If drivers use Ford’s Value Charging, the cost of traveling 80 miles in the Focus Electric drops even further to just less than $1 to travel 80 miles.
We are taking a range of steps to further reduce the operating costs of EVs to help offset their higher purchase price.
Through Value Charging, for example, we are helping EV owners find the most efficient times to charge their vehicles. This system helps customers reduce their electricity costs by taking advantage of off-peak or other reduced utility rates without a complicated setup process.
The MyFord Touch®-based in-vehicle communications systems on our electric vehicles, described in Living the Electric Lifestyle, also help reduce EV operating costs by enabling drivers to maximize their driving efficiency and in-vehicle energy use.
Our BEVs will also have lower maintenance requirements than gas-powered vehicles. The Focus Electric eliminates more than two-dozen mechanical components that would normally require attention during the life of the vehicle. So, for example, drivers won’t have to change oil, oil filters, fuel filters or spark plugs, or worry about a worn-out muffler or serpentine belt. Based on a regular oil change maintenance schedule, Focus Electric owners will save approximately $500 over the 150,000-mile life of the vehicle on oil change costs alone.