The recent surge in gasoline prices, driven by the escalating conflict between the US and Iran, has led to a significant increase in interest in electric vehicles (EVs) among American car buyers. As reported by The Guardian, online searches for electric and hybrid cars have risen by 20% since the start of the conflict, according to data from CarEdge, a car-buying platform.
Justin Fischer, an automotive analyst at CarEdge, notes that the spike in interest is directly connected to the news of the war and the subsequent rise in gas prices. "If we see these higher gas prices dragging on for a month or more, we will see bigger and bigger numbers," he said. The average national price of gas has reached $3.90 a gallon, the highest level in nearly three years.
Jessica Caldwell, head of insights at Edmunds, also observed a jump in online research activity into EVs by people looking for a new or used car. "Gas isn't something you can hide from, it's right in your face, you see the cost as you fill up each time," she said. Caldwell added that the rise in gas prices has become a conversational point for many people, with some EV drivers in Los Angeles even sharing memes about happily watching others worry about the gas price.
Market Trends and Challenges
The US lags behind many other wealthy countries in electric car sales and charging infrastructure, with sales badly hit last year by a Republican spending bill that phased out Joe Biden-era incentives to purchase non-polluting cars. Despite this, used EVs are becoming an attractive option for people on lower incomes, with models like used Teslas, Chevy Equinoxes, and Nissan Leafs becoming affordable to many Americans.
Caldwell notes that "you can get a fairly decent used EV for under $25,000, which is pretty decent considering what the new vehicles sell for." She expects these affordable EVs to be "snapped up now." Hybrid cars, such as Toyota's Camry and Rav4, are also set to do well among Americans concerned about going fully electric and being stuck without a charging point, according to Fischer.
New EVs remain expensive compared to gas cars, with EV owners a disproportionately wealthy slice of the US population. Just 7.8% of all car sales last year were electric, down slightly on 2024. The Trump administration has sought to further stall EV growth by halting separate fuel efficiency standards in California.
Global Perspective
Electric cars are making major headway in the rest of the world, with EVs accounting for one in five new sales globally. Some countries, like Norway, have almost eliminated the need for new gas cars, with just seven traditional petrol cars sold in January. Caldwell notes that "American automakers realize EVs are definitely the long-term strategy, but they can make a lot of money in the short term with SUVs and pick-up trucks."
Don Francis, president of the EV Club of the South, said many people are still hesitant to purchase an EV due to concerns about their range. "There is interest, but people aren't being pushed over the edge yet," he said. Francis believes that there may be a tipping point if gas prices remain high, and he wants the US to achieve "energy independence" to avoid conflicts related to oil.
Expert Analysis
Experts agree that the current surge in interest in EVs is driven by the rising gas prices, but it remains unclear if this interest will endure and translate into market share. Fischer notes that "if we see these higher gas prices dragging on for a month or more, we will see bigger and bigger numbers." Caldwell adds that "a lot of the technology for EVs is developed in the US, but China is very good at scaling and making them inexpensive."
The policy changes in the White House every four years also pose a challenge for car companies, making it difficult for them to operate and plan for the long term. As the US continues to navigate the complexities of the Iran conflict and its impact on the global oil market, one thing is clear: the interest in electric vehicles is on the rise, and it will be interesting to see how this trend develops in the coming months.
