Electric Cars vs Gasoline Cars: A Net Present Value Approach in the United States vs Europe

Elene, a finance graduate student passionate about environmental conservation, had always been an advocate for cleaner transportation. She was intrigued by the Biden’s Administration efforts to boost electric vehicle sales. However, she was surprised by the current low electric car sales market share in the US and fascinated by the significantly higher market share in Europe. Recognizing costs as a major factor affecting customers’ purchasing decisions, Elene decided to employ the Net Present Value (NPV) method to compare the financial viability of electric cars compared to gasoline cars in the US compared to Europe. She aimed to incorporate various cost assumptions, adjust her analysis for different scenarios, and draw conclusions and make recommendations on the economic feasibility of electric cars.