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What if I told you that auto dealerships are one of the largest political forces in the United States? To dealerships both big and small, business is about a lot more than selling cars. There are 17,968 new car dealerships in the United States, a figure that has grown at the same time that vehicle inventory has plummeted, and new car prices have skyrocketed. New and used car dealers have become more powerful at a time of unprecedented turmoil in the automotive industry. As the price of a new vehicle rises out of reach for millions more American consumers, the same dealers who are marking up limited inventory are reporting all-time record profits.
How did dealerships come to exert such a massive influence on the economy and even politics of America? Just how powerful are dealers in the nation’s economy and the sphere of American politics? To find out, we’ll take the backroads of America to bring this fascinating story of power and influence into the spotlight. Nine out of ten American households own a car, and 55% of autos are purchased at a dealership. This is the tale of how we got here.
A Brief History of the Auto Dealership
As the nascent automotive industry came to exist in the late nineteenth and early twentieth centuries, automakers faced a dilemma. They had figured out how to engineer and produce a transformative product, but how would they deliver and service these first automobiles? Better yet, who would educate the consumer about vehicle ownership?
It’s important to remember that automakers were selling ‘horseless carriages’ to customers who literally relied on horses (or their own two feet) for transportation. The majority of the population knew nothing of internal combustion engines. In the first and second decades of the twentieth century, automobile adoption picked up pace. How would an ordered vehicle get to a customer’s hands? Who would service these ‘motor carriages’? Would the customer foot the bill for repairs, or would the automaker offer a warranty? These are just a few of the questions up for debate when the car dealer distribution model was conceived.
It took a few decades for the logistics of car distribution to get worked out. Not everyone was on the same page, and some pushed for solutions modeled after other industries. In fact, some early ideas sound ludicrous to us today. Many early auto industry players advocated for a mail order service modeled after the successes of Sears & Roebuck and Montgomery Ward. But that left too many questions unanswered for a young industry that was eager to get it right. Despite the world-changing invention at hand, automakers still feared their own demise. Considering how few of the early automakers have persisted to this day, their fears were not unfounded.
The first dealership in the United States was established in 1898 by William E. Metzger, who sold Oldsmobiles in Detroit. Over the next two decades, the dealership model rose to prominence, slowly overcoming competing automobile sales models. In 1917, the now-famous National Auto Dealers Association (NADA) was established with the goal of giving car dealers a voice in Washington.
The Rise of the Car Dealer Lobby
Today, the NADA is a nationally-recognized industry and political force that represents over 16,000 auto dealers nationwide. However, one of America’s most powerful lobbies had humble beginnings rooted in the turmoil of a wartime economy.
The NADA was founded in 1917 when a group of dealers set out to change the way Congress viewed the emerging automobile industry. Thirty dealers from state and local associations succeeded in convincing Congress that cars weren’t ‘luxuries’ as they had been classified in the federal tax code. By convincing lawmakers that cars were vital to the economy, the group prevented the conversion of young automobile manufacturing facilities into wartime factories. The so-called ‘luxury tax’ that had been levied on cars was reduced from 5 percent to 3 percent.
In essence, the NADA has been lobbying since the very beginning. And they’re good at it. From 1919 to the present day, the group spearheaded hundreds of legislative priorities that served the interest of the ever-growing number of car dealers in the United States.
In American car culture, cars are central to the economy and most of our day-to-day lives. In 2020, 91% of American households owned at least one car, a figure that continues to grow. Where do the 276 million registered vehicles in the U.S. come from? Until the rise of direct-to-consumer sales in the past decade, it was almost always from a local dealer.
State dealer associations are prominent organizations around the country. Some states have massive state-level associations. The Florida Automobile Dealers Association has over 1,000 dealer members, and dozens of other states have associations of similar size. Political action begins at the grassroots level, and this is where state dealer associations flex their muscle.
State auto dealer associations provide networking opportunities for professionals, a regional dealer support system, and a venue for working out solutions to challenges. There’s also the unified political voice that lobbies at the local, state and nationwide levels. Lobbyists advocate to influence political decisions on behalf of a client. Lobbying costs money, both in the form of employing professional lobbyists, and in lawmaker donations. I’ll scratch your back if you scratch mine? Dealer industry associations have shown time and time again that they’re highly effective lobbyists achieve their desired outcome more often than not. Money talks.
SOS: Save Our Service Department
A recent example of what’s possible at the state level comes in the form of an emerging legislative push that’s troubling for any electric vehicle owner or prospective buyer. In 2022, bills were introduced in both Oklahoma and West Virginia that would ban over-the-air (OTA) updates. Why? Car dealer lobbying groups are doing their best to keep drivers returning to dealer service centers for repairs. Tesla’s pioneering OTA updates have revolutionized everything from performance upgrades via wifi to recall fixes from the comfort of home.
Why would dealership lobbying groups have a bone to pick with OTA updates? Service center visits account for nearly half of total dealership revenue, with some locations relying heavily on service to stay profitable. The electrification of the auto industry is here, and resistance to OTA updates is just a sign of what could be around the corner.
Online car sales have disrupted the industry over the past decade, with the likes of Carvana and Vroom seemingly coming out of nowhere. Their entrance hasn’t been without problems. Carvana is under pressure for repeatedly failing to transfer vehicle titles in a timely manner. The solution? A Florida state senator took the time to hand-craft legislation to simply remove the requirement to provide the title at all. If that’s not motivated by state-level dealer lobbying, I don’t know what is.
The Power of Dealerships Isn’t Just Political
Over 1.2 million Americans are employed at the nearly 18,000 franchised car dealerships and 60,000 independent dealerships in the United States. The power of dealerships is very much rooted in the economy of the nation. However, this power is not evenly distributed. In many communities, particularly in small-town America, dealerships have an oversized role in the local economy.
Jim Lardner, spokesperson for Americans for Financial Reform, told David Dayen of The Intercept that communities sometimes even rely on the economic powerhouse of locally owned and operated dealerships. “They sponsor Little League teams. Their advertising dollars are crucial to local newspapers and broadcasters. When they talk, lawmakers don’t just listen — they have a hard time hearing anybody else or looking at facts.”
As is often the case, with more economic power comes the appetite for political power. Sure, probably not for the sake of power itself, but to have a say in the rules of the game.
How Do Auto Dealers Influence Politics? You Guessed It…
The National Auto Dealers Association has delivered $35 million to members of Congress since 2022. The NADA maintains a large lobbying operation in DC, one that costs $3 million a year to operate. The power of dealers is not limited to the doings of the NADA and state-level associations. In a recent election cycle, 372 of 435 members of the House of Representatives received campaign contributions (money) from auto dealers. 57 out of 100 senators could say the same.
Dealers Don’t Go It Alone
On a national level, the NADA has collaborated with the Alliance of Automobile Manufacturers and even the American Financial Services Association to push favorable legislation. In 2015, a rare bipartisan bill was a textbook example. The bipartisan bill amounted to a stand-down order to the Consumer Financial Protection Bureau (CFPB). Shouldn’t lawmakers be standing up for the consumer, not the opposite?
It gets worse. The CFPB was established in 2011 to protect consumers to promote “transparency and consumer choice and prevent abusive and deceptive financial practices. It was partially in response to what we all went through in the 2008 financial crisis. When the CFPB was created, a special provision was added last-minute just for nervous dealers. This provision, which is enshrined in CFPB regulations, says that the agency itself can NOT directly monitor dealerships. As David Daley notes in his wonderful piece in The Intercept, “the CFPB can only fine the lenders who finance car purchases, not the dealers who make the markups”.
Riders: The Secret Sauce
This is one of many examples of auto dealers wielding their power to influence laws and regulations in their favor. The secret to their success is something called legislative riders. Riders are provisions or ‘add-ons’ that can be added to a bill last-minute, often with hopes of its controversial aspects being buried in the hundreds or thousands of pages of more newsworthy text. The West Virginia OTA ban that was proposed and later removed is one such example. It was conveniently tucked into a much larger pro-dealer bill.
The rise of electric vehicles is changing the industry unlike ever before.
Record new and used car prices have soured consumer sentiment. Dealer markups regularly reach beyond $10,000, and more car buyers are turning to Tesla and other direct-to-consumer automakers to steer clear of the dealership experience. Nine out of ten Tesla buyers cite the no-hassle direct-to-consumer sales model as a major factor in their buying decision. Now, legacy automakers are testing the waters too.
In early 2022, Ford made headlines with the announcement that it would split into two new companies under the Ford Motor Company umbrella: Ford Blue for combustion sales, and Ford Model e for electric vehicle sales, including the very popular F-150 Lightning.
2022 Ford F-150 Lightning Pro
Ford Model e transforms Ford’s electric vehicles sales model to something between direct-to-consumer and the traditional dealership model. There will be no-haggle set pricing, online ordering, but dealers will continue with a role as delivery, test drive and service centers. If you haven’t connected the dots, Ford is taking a few big steps away from the past century of traditional dealership sales. Will other automakers follow?
Mercedes-Benz and BMW are beginning to test what they call agency sales in Europe. Essentially, it’s the same concept as Ford’s Model e business model. Are the floodgates opening in the push to direct-to-consumer sales? We’ll know soon enough.
Car dealerships are powerful economic and political forces in America. The birth of American car culture parallel to the rise of the dealership lobby was no coincidence. However, times are changing. Can dealers lobby their way out of an industry that is evolving at breakneck speed? What will buying a vehicle look like a decade from now? Unknowns abound, but one thing is for sure: the salespeople out front are eagerly awaiting your arrival.
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What are the three biggest concerns of drivers pondering the switch to electric mobility? Survey after survey, we find that it’s range, charging and price. And with good reason. Electric vehicles remain $11,000 more expensive than their combustion counterparts on average, and much of America remains a charging desert, unless you can afford the premium for a Tesla. With all of this in mind, is there room for a newcomer to the North American EV space? NIO is on the verge of making it official, as evidenced by their growing presence at their California corporate center. Just what makes NIO stand out from the crowd? It turns out that the Chinese EV startup has some game changers in store.
No Time to Charge? Pull In For a Battery Swap
Let’s cut to the chase. When the conversation turns to NIO, it’s all about battery swaps, affordability and accusations of NIO being Tesla copycats. Controversies aside, NIO has revolutionized what’s possible for EV drivers in China by successfully introducing battery swaps as an alternative to charging. NIO battery swaps are free of charge. Electric vehicle adoption in China has been adopting EVs much quicker than we have in America, with 21% of new vehicle market share being fully-electric in the first months of 2022.
NIO has over 700 stations in China, and it wants to increase that number to 4,000 by 2025. How does a NIO battery swap work? Imagine a fancy car wash-like drive-thru. Instead of slowly pulling in and aligning your car just right to get a wash, you pull in to have a robot remove the battery from the bottom of your car, which is then quickly replaced with a fully-charged battery. Pretty neat, right? NIO says that right now, the cost to build one battery swap station is around half a million dollars. With the next iteration of battery swapping, they plan to halve that cost.
For those who aren’t into the battery swap thing, NIO also offers DC fast chargers for its customers.
NIO Is Expanding Beyond China in 2022
Norway is the first European market to become home to NIO’s electric vehicles and unique charging infrastructure. The first battery swap station in Norway opened in January of this year, and 20 more are under construction. By year’s end, NIO will be setting up shop in Germany, Sweden, the Netherlands and Denmark.
What about NIO’s presence in the United States? NIO has established NIO USA, which is now headquartered in a 201,500 square-foot corporate facility in San Jose, California. If you’re not familiar with corporate shenanigans, that’s MASSIVE.
Chinese media recently reported on some eye-catching job announcements from NIO. Specifically, the company is in search of professionals experienced in building a factory in the United States. According to Chinese media outlet Yicai, Nio is also hiring a blueprint planner with experience in “at least one US factory project.” NIO is coming to America! Fellow EV enthusiasts over at InsideEVs covered the details of the rumor.
NIO Electric Cars: Tesla-esque EVs with Lower Prices
In China and select European countries, NIO offers five all-electric models in 2022. The lineup includes two sedans and three crossover SUVs.
NIO ET5
The ET5 is a mid-size electric sedan comparable to the Tesla Model 3. This new model is expected to have a range between 342 and possibly 600 miles, depending on battery pack capacity. It’s fast, too. NIO claims a 0-60 mph time of 4.3 seconds, propelled by dual electric motors that produce 482 horsepower. The NIO ET5 costs roughly $51,000 USD in China. Pricing in America would be pure speculation at this point. See NIO’s product info here.
NIO ET7
The ET7 is NIO’s new flagship model. The Chinese automaker announced that the ET7 has achieved the second-best drag coefficient on any production vehicle, at 0.208. That’s tied with the Tesla Model S. Only the Mercedes EQS is more aerodynamic. The Lucid Air is right behind at 0.21.
In addition to battery swapping, NIO is going after recognition for ultimate range. Starting in late 2022, the ET7 sedan will offer a massive 150 kWh battery option, which NIO claims will be good for over 600 miles on a charge. Not even the Lucid Air can claim that in 2022.
In China, the ET7’s price starts at $91,000 USD. This luxury sedan is going after the Tesla Model S. See the full details.
NIO EC6
The NIO EC6 is the sportback coupe variant of NIO’s ES6 crossover SUV. The EC6 starts at $52,500 USD in China. Range estimates are from 273 to 381 miles, depending on battery configuration. It’s a quick coupe, with both Sport and Performance Editions available.
NIO ES8
The first NIO model sold outside of China is the NIO ES8, a SUV available in six-seat and seven-seat configurations. This is a full-sized SUV, akin to the Tesla Model X in size and interior volume. If the ES8 indeed makes it to America, this will undoubtedly be a hot seller. Oh, and the passenger seat is effectively a business class lounge. The price? In Europe, it starts around $70,000. Learn more.
NIO ES6
The ES6 fits snuggly into the most popular vehicle segment in America. Of course, that’s the crossover segment. This five-seater is much-loved by the team at Top Gear. They liken it to some popular competition: theAudi e-Tron, Mercedes-Benz EQC, Jaguar I-Pace and Tesla Model X.
In China, the NIO ES6 starts at $52,000 USD, and is rated for between 300 and 380 miles of range.
The Catch
Not all of NIO’s customers are thrilled with the battery swapping concept. In response to customer requests, NIO now lets owners buy a battery from the automaker. It will cost an arm and a leg though. For those who do not wish to take advantage of NIO’s unlimited free battery swaps, you can purchase a permanent battery pack for $11,000 to $20,000, depending on the capacity.
Nevertheless, NIO is coming to America with their game-changing charging strategy. I have my doubts that it will be free and unlimited like it is in China, but consumers may be eager to pay for the convenience of battery swapping EVs. What do you think? Is there room for NIO in the North American electric vehicle market? Let us know in the comments, or better yet, head over to the CarEdge Community Forum to discuss with fellow auto enthusiasts and curious car buyers.
Outside of warranty, electric car battery replacement costs range from $15,000 to well north of $20,000 in a fully-electric vehicle. It’s true that batteries should be much more affordable a decade from now, but that’s a lot of money on the line. To protect your wallet, EV manufacturer warranties should be a top consideration for drivers looking to go electric.
Federal law requires automakers to warranty EV and hybrid batteries for at least eight years or 100,000 miles. California requires a 10-year, 150,000-mile warranty on EV and hybrid batteries. Still, EV battery warranties vary considerably, especially when it comes to degradation.
These are the best electric vehicle warranties in 2024. The top of the list was unexpected to say the least!
The Best EV Battery Warranty
Rivian (8 years or 175,000 miles)
Surprise! The best EV warranty is offered by Rivian for the all-new R1T electric truck and R1S electric SUV. Coverage includes all components inside the high-voltage battery and 70% or more of the battery capacity for 8 years or 175,000 miles, whichever comes first.
Drivetrain components are also covered for 8 years or 175,000 miles. It can be unnerving to purchase a vehicle from a startup like Rivian, so at least they’re offering the best battery warranty there is. Learn more about Rivian’s warranty here.
Tesla Battery Warranty
Tesla’s electric powertrain warranty is split into two tiers.
The Tesla Model S (starting at $99,990) and Tesla Model X (starting at $114,990) have 8 year or 150,000 mile electric powertrain warranties. Battery capacity retention is guaranteed to be at least 70% under warranty.
The Tesla Model 3 Long Range and Performance and all Tesla Model Y’s get an 8 year or 120,000 mile powertrain warranty.
The most affordable Tesla today is the Model 3 Rear-Wheel Drive, which gets an 8 year or 100,000 mile powertrain warranty.
The Best Battery Warranty For Affordable Electric Cars
Hyundai and Kia (10 years or 100,000 miles)
For electric cars under $65,000, you can’t beat Hyundai and Kia’s 10 year/100,000 mile EV warranty. The Hyundai EV warranty covers batteries, motors and powertrain components. There’s also the guarantee of at least 70% battery capacity retention. “While all electric-car batteries will experience degradation over time, ours will not degrade more than 70 percent of the original capacity during the warranty period.”
Hyundai’s warranty was a big consideration when I decided to purchase a 2022 Hyundai IONIQ 5 for my family. Learn more about the IONIQ 5, and the ups and downs of my own EV shopping experience.
Learn more about Hyundai’s electric vehicle battery warranty. You can find Kia’s EV warranty details here.
The Rest of the Gang: 8 year/100,000 Mile Battery and Powertrain Warranty
In 2024, it looks like the industry standard for EV manufacturer warranties is 8 years or 100,000 miles, whichever comes first. This manufacturer warranty applies to the following electric vehicles in 2024:
Ford Mustang Mach-E (70% battery capacity retention guarantee) see the details
Ford F-150 Lightning (70% battery capacity retention guarantee) see the details
Jaguar I-PACE (70% battery capacity retention guarantee) see the details
Lucid Air (70% battery capacity retention guarantee) see the details
Polestar 2 (70% battery capacity retention guarantee) see the details
Volvo XC40 and C40 Recharge (70% battery retention guarantee) see the details
Volkswagen ID.4 (70% battery capacity retention guarantee) see the details
Audi e-tron (70% battery capacity retention guarantee) see the details
Chevy Bolt (60% battery capacity retention guarantee) see the details
Nissan Leaf (70% battery capacity retention guarantee) see the details
Nissan Ariya (70% battery capacity retention guarantee) see the details
Toyota bZ4X (70% battery capacity retention guarantee) see the details
The Worst EV Battery Warranty in 2024
We hope that the Blazer and Equinox EVs have a better battery degradation guarantee than the Bolt!
I’m surprised that GM is continuing to settle for last considering their much-publicized push to electrify their entire lineup quickly. The Chevrolet Bolt and GMC Hummer EV have 8 year/100,000 mile battery warranties with a notable catch. The battery retention portion of the warranty will replace the battery if it falls below 60% of the original capacity under coverage. See the full details here.
In 2022, electric vehicles make up about 5% of new vehicle sales in the US. As that figure increases, common sense and civility are going to matter a lot more at public charging stations. Charging stations are rarely crowded in 2022, but that may be about to change. We can look to California for a glimpse into our own electric future. The Golden State has seen EV market share jump to 16% of new car sales in recent months, and charging infrastructure is rushing to catch up as Tesla Superchargers and Electrify American stations fill up. With more EVs hitting the roads, now is the time to address electric car charging etiquette.
Know the Maximum Power That Your EV Accepts
2022 Chevrolet Bolt EUV charges much slower than competitors, but it’s way more affordable!
Electric vehicles are commonly judged by two important criteria: range and charging speed. In 2022, EV models vary widely in charging speed as a result of the battery management systems that electric powertrains were engineered with.
For example, these are the max power specifications (in kilowatts) that popular EVs will accept at a DC fast charger, such as those you’ll find at Electrify America or a Tesla Supercharger:
Tesla Model Y: 250 kW
Tesla Model 3: 250 kW
Hyundai IONIQ 5: 230 kW
Kia EV6: 230 kW
Ford Mustang Mach-E: 150 kW
Volkswagen ID.4: 135 kW
Chevrolet Bolt: 55 kW
Nissan Leaf: 50 – 100 kW (depending on trim)
Ford F-150 Lightning: 150 kW
Volvo XC40 Recharge: 150 kW
Audi Q4 etron: 150 kW
Pulling into a Level 2 station at a shopping mall, hotel or restaurant? Just plug in, you’ve got nothing to worry about with regards to max power. Level 2 charging supplies between 3kW and 19 kW of power, more often between 7-10 kW. This is nowhere near as fast as your EV can accept, so there’s no hierarchy of charging speeds to worry about. Level 2 EV chargers include Tesla destination chargers, Volta shopping center and movie theater plugs, plus many Blink and ChargePoint Level 2 stations.
Pulling into a Level 3 ‘fast charging’ station, this is where your EV’s charging speed matters, at least for non-Tesla drivers. When not charging at home overnight, Tesla drivers rely on one of Tesla’s 1,300 Supercharger locations in America for DC fast charging. No worries at Tesla Superchargers, all plugs at each location are either 150 kW power delivery (AKA V2 Superchargers), or newer 250 kW ‘V3’ Superchargers.
The Tesla Supercharger network
Older V2 Tesla Superchargers have one caveat in addition to slower charging speeds: power sharing. If you plug in at a Supercharger stall right next to another charging car, you and the other driver will have to share the power, resulting in slightly slower charging speeds for both of you. If there’s a charging stall available at least two spots down from another Tesla charging, do the other guy a favor and plug in over there. At newer V3 stations with 250 kW power, just pick a station and plug in! There’s no power sharing at V3 Superchargers or Electrify America stations.
Those of us who don’t drive a Tesla are relying more and more on Electrify America’s network of chargers. Electrify America does things a little differently. A station typically has two ultra-fast charging 350 kW stations, a few 150 kW stations, one of which has a blue CHAdeMO plug that really stands out.
Here’s what you need to bear in mind at Electrify America:
If your EV accepts say 130 kw or 150 kw peak power for example, PLEASE don’t plug into the only 350 kw station available! Sure, if the rest are taken, go for it. But if you have the option, go for the charging stall that is closest to your EV’s peak charging rate.
CHAdeMO (the big blue plug): Do you have a Nissan Leaf? If not? Don’t use the station with the blue CHAdeMO plug unless it’s the only one available. If it comes down to choosing between the 150 kW stall with the blue CHAdeMO connector or a 350 kW stall but your Volkswagen ID.4 only accepts 130 kW max power, go ahead and use the CHAdeMO one. Why? The Nissan Leaf is the ONLY EV with this plug standard, even the new Nissan Ariya has abandoned CHAdeMO in favor of the CCS plug standard. There are fewer Nissan Leaf’s on the road than there are fast-charging EVs in 2022. The statistics are in your favor.
Move your car when you’re done charging
Remember when you drove a gas-powered vehicle and made weekly stops at the gas station? What about when it was Labor Day weekend and everyone was traveling, and the gas station along the highway was packed? Isn’t it a bad move to leave your car parked at the gas pump while there’s a line of cars waiting to fill up? Well imagine doing that when the only other places to charge are many miles away. Please, move your car when you’re done charging.
If you have no plans to charge and just want to use the fancy dedicated EV parking spot, resist the temptation and park elsewhere. EV drivers like myself know that we’re more likely to have a charging stall blocked by a careless EV driver than by an ICE vehicle.
A PSA For Tesla Drivers
The pull-through charging stall is for drivers towing a trailer. Only use it if it’s the only one available, or if you have a trailer.
Battery management systems are designed to distribute electricity to each and every battery cell within the battery pack in the safest way possible for the health of the battery. Because of this, every single EV on the market, from the $26,000 Chevy Bolt to the $130,000+ Lucid Air, will ramp down charging speeds significantly beyond 90% state of charge. This is especially beyond 95%.
I recently did a test in my own Hyundai IONIQ 5 at Electrify America. It took 19 minutes to charge from 15% to 80%, with a peak power of 233 kW. However, because of battery management, charging from 80% to 95% took another 14 minutes. Did it matter on that day? No, I was the only one at the charger that day. Someday, with more EVs on the road, it’s going to matter.
Be nice, Be Helpful, and Turn Down the Music
Electric vehicle adoption isn’t a walk in the park for those of us who don’t watch EV videos on YouTube all day. If you see a neighbor struggling to charge their EV for the first time, maybe offer a helping hand, or at the very least, don’t give them dirty looks.
Please, PLEASE don’t blare music with your windows down at a charging station. Be mindful of others, and the possibility of napping little ones in the cars around you.
In 2022, EV drivers are still ambassadors of electric mobility. The world could use a little kindness!
With gas prices rising above $5 a gallon, more drivers are looking for ways to save at the pump. The average American driver spends nearly $3,000 every year on fuel expenses. These 5 tips can save you big time when you fill up.
Use These Apps to Find the Cheapest Gas
Driving around town looking for the cheapest gas comes with a caveat: you’re burning more fuel by looking for a deal! Nowadays, several popular apps help drivers find the lowest gas prices. These are the best cheap gas apps today:
GasBuddy
GasBuddy has been around for 20 years, and is the most well-known of the cheap gas apps. GasBuddy crowdsources gas prices from users who report what they find. This works great in high-traffic areas, but less-frequented rural gas stations suffer from underreporting, and therefore out-dated prices on the app.
In addition to simply showing users where the lowest gas prices are in their vicinity, GasBuddy also offers a payment card that includes discounts of up to 25 cents per gallon. Taking it a step further, GasBuddy Premium guarantees a 20 cent to 40 cent per gallon discount on fuel with the $9.99/month Premium plan (or $99 annually). The catch? There’s a limit of 50 gallons per month. That’s enough for most drivers.
Fuelio
Track all transportation-related costs with Fuelio.
At CarEdge, we’re all about transparency in the automotive world. Fuelio brings transparency to the true cost of ownership for your vehicle. Fuelio does a lot more than help you find cheaper gas. This free app also tracks your fill-ups, fuel economy, mileage and more. Costs associated with car maintenance, tolls and parking fees are all tracked within the app. Fuelio is great for drivers who love keeping track of their expenses all in one place. You’ll get a better idea of the true cost of vehicle ownership.
Upside
Cash back for gas?! Keep your receipts! Upside helps you save up to 25 cents a gallon when you take a photo of your gas station receipt and submit it through the app. Great news for the data cautious: no need to share your bank or card information.
Upside does also offer the option to ‘check in’ and pay for fuel with a saved card, but it’s not required to get the cash back. You can choose to receive your cash back through PayPal, a digital gift card, or even an old-fashioned paper check.
Don’t Buy Gas Along the Interstate
Using the cheap gas apps, we can see a clear trend: gas is often more expensive along major highways. Why? Consumers pay for convenience. A quick look at GasBuddy’s gas price map shows that prices per gallon of gas are often 10 cents to 20 cents cheaper just a half mile away from stations along major highways.
Drivers along this Texas highway would save 24 cents per gallon by driving just a half-mile off the interstate.
Is it worth it to drive a mile further for cheaper gas? Consider this. America’s best-selling vehicle, the Ford F-150, has a 23 gallon tank. Let’s say our driver isn’t quite running on fumes, but it’s time to refuel. Exiting off the highway, gas prices at the truck stop are $4.69 a gallon. A mile into town, gas is $4.45 a gallon. After diverting into town for the cheaper gas, the truck is filled up with 20 gallons of gasoline. The 24 cent difference between the stations resulted in $4.80 saved in one fill-up. That’s almost enough to cover lunch!
Interstate Travel: Buy Gas in States with Lower Gas Taxes
GasBuddy’s gas price heat map illustrates the effects of state gas taxes on prices.
It’s amazing how much state gas taxes vary from one state to another. It’s not uncommon for gas prices to be 30 cents higher per gallon across a state line. Know which states along your travel route have the cheapest gas, and fill up before exiting those low-tax states.
States with the highest gas taxes
Pennsylvania ($0.586)
California ($0.533)
Washington ($0.519952)
New Jersey ($0.414)
New York ($0.4045)
States with the lowest gas taxes
Alaska ($0.0895)
Hawaii ($0.16)
Virginia ($0.162)
Missouri ($0.1742)
Mississippi ($0.184)
What do state gas taxes mean for your wallet? If a driver heading north on I-79 fills up in West Virginia, gas prices are 30 cents to 50 cents cheaper per gallon than what they’ll find across the border in Pennsylvania. That adds up quickly!
Make Credit Cards Work For You
Do you have a 2% cash back credit card? Or better yet, do you have a card that offers more cash back on select categories? It’s worth looking into. There are several credit cards that offer 3% cash back on fuel expenses. The average American driver spends nearly $3,000 on fuel every year. At that rate, 3% cash back means $90 back in your pocket every year. The magnitude of cash back rewards for fuel purchases only increases as gas prices increase.
Use Grocery Store Fuel Rewards
I doubt anyone enjoys digging through their wallet or purse for each and every supermarket’s rewards card. With gas prices at record highs, it’s worth the hassle. Not only do grocery rewards cards save you money on your grocery bill, they often save at the gas pump.
Kroger Fuel Rewards
With Kroger Fuel Rewards, you can earn generous fuel points with every grocery purchase at the Kroger family of grocery stores. Get 1 fuel reward point for every dollar spent. Earn double points when you purchase gift cards. When you have accumulated 100 points, you earn $0.10 off a gallon of gas.
Costco Fuel Discount and Cash Back
With 574 Costco warehouse stores in America, cheaper gas might be just around the corner. Costco’s gas prices are typically between 10 cents and 30 cents cheaper than surrounding gas stations. To gain access to Costco’s famously low gas prices, you’ll have to be a Costco member. An annual membership fee of $60 can easily be paid back with fuel savings.
Citi partnered with Costco to offer the Costco Anywhere Visa card that gives you 4% cash back on gas up to $7,000 per year. That’s one of the best credit card fuel rewards out there. Learn more about Costco’s Kirkland Signature fuel rewards here.
Sam’s Club Fuel Discount
Sam’s Club’s 600 store locations are renowned for their cheap gas prices. Sam’s Club is the WalMart family’s warehouse store that is accessible by membership. For the penny-pinchers, Sam’s Club memberships start at $45. In just a few months of gas fill-ups, you could recover your membership fee in savings.
Dozens of other supermarkets and gas stations offer rewards programs, and many of them are free to join. Check with your neighborhood grocery store to see if they have a program that will help you save on gas.
Bonus: Drive More Efficiently
Even if you’re stuck with a gas-guzzler, driving habits have a huge effect on fuel economy. The difference between getting 15 miles per gallon and 20 miles per gallon equals over $1,000 in annual fuel savings at today’s prices.
The following adjustments to your driving behaviors can save you A LOT of money:
Drive 5 miles per hour slower on the highway. All vehicles get much worse fuel economy at speeds over 70 mph. 80 mph driving results in poor, costly gas mileage.
Don’t be heavy-footed! Practice gentle acceleration. There’s no need to slam the pedal if there’s a stoplight just ahead. It’s costing you.
Take the most efficient route when navigating. Google Maps now displays which route option will result in the best fuel economy.
Ensure your tires are properly inflated. Deflated tires have higher rolling resistance, meaning that more fuel is needed to propel the vehicle forward.
Will Gas Prices Go Down in 2022?
Right now, gas prices continue to climb to new records. However, the U.S. Energy Information Administration (EIA) predicts a slight decrease in gas prices in the latter half of this year. By the third quarter of 2022, EIA predicts that retail gasoline prices will average $4.27/gal. As of this writing, the national average sits at $4.92.
The U.S. EIA’s predictions for oil prices in 2022 and 2023.
Wall Street bankers at Goldman Sachs predict that gas prices will rise until they reach a yet-uncertain point that incentivizes more oil production, and/or keeps more drivers off of the road. Goldman Sachs predicts that Brent crude oil prices will average $140 a barrel between July and September. Brent is currently trading between $115 and $125 a barrel.
We can only hope for the best. Interest in electric vehicles continues to rise, and electrified cars are taking more and more market share. However, supply shortages are holding back new car inventory, EVs remain expensive, and charging infrastructure has yet to meet the needs of all Americans. The latest data shows that driving has decreased by 3% since this time last year. If you’re looking for ways to save money on gas, clearly less driving is the most immediate cost-cutting measure.
What did we miss? If you have other tips for how to save money on gas, let us know in the comments below, or reach out to me at justin@CarEdge.com.
