This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Electric Cars: The Right and Wrong Reasons for Buying

Stocks in this article: GM TM

3. "Electric cars are good for the environment."

This is a hot-button issue I am not going to fully address, let alone from a public policy perspective. From a personal perspective, however, it's a different story.

No matter what you assume for the environment, your ability as a single consumer of an electric car to affect it is essentially zero. Yet, others -- such as me -- don't agree with the premise that there is anything wrong with the environment. So environmental arguments don't bite on me and many others.

But wait -- there is actually one area where electric cars are indisputably better for the environment: Noise. Whatever other demerits electric cars may or may not have, one thing is for certain: They do cure noise pollution. Imagine walking down Madison Avenue in New York City and not hearing any meaningful noise from all of these cars. Imagine living on the third floor in midtown Manhattan and sleeping with the window open.

4. "Electric cars drive better."

This is the one that matters, folks. In the end, until the other cost-related arguments become more clear or are otherwise settled, it's all about the actual driving experience.

Ask your fellow Americans who are actually driving electric cars every day. What do they tell you? Let me suggest that almost all of them -- 99%? -- will tell you their electric car simply drives better than a gasoline or diesel car.

Why is that? It's similar to having an SSD in your PC as opposed to having an HDD. It's about fewer moving parts, nothing spinning thousands of times per minute.

An electric car has fewer parts overall, and fewer moving parts. It gives you 100% of the torque right away. It doesn't require a transmission, and it doesn't make any meaningful noise. Pressing the accelerator simply has a very different feeling. If you haven't driven one, you wouldn't know.

Then there's the braking. Electric cars have different degrees of regenerative braking. Some cars, such as the Volt, offers multiple settings for this. What this means is that when you let up on the accelerator, the car brakes as the car recaptures the energy into the battery. This means that unless you need to brake very sharply you don't need to touch the brake pedal.

We refer to this as "one-pedal driving." Once you get used to it, it is vastly preferable to having to press the brake pedal all the time. Again, this is difficult to explain to people who have not driven an electric car.

Bottom line: Get one, but not for the wrong reasons.

There are some reasons people give for buying an electric car: Saving on gasoline, saving money overall, saving the environment. As I have shown, these arguments are either dubious, invalid or at least in severe doubt. They can also be at least somewhat accurate, depending on a person's situation and assumptions.

That said, the rational reason to buy an electric car is that it simply drives better. Unlike the other arguments, it's also the one that is almost impossible to discuss without first-hand knowledge gained from the experience of driving one.

For this reason, I recommend you test-drive an electric car before you make up your mind. I suggest the probability you will like it is very high.

At the time of publication the author had no position in any of the stocks mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs