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Electric vehicle sales surge in Minnesota as gas prices hit four-year high

By Nina Rossi4 min read
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Electric vehicle sales surge in Minnesota as gas prices hit four-year high

Minnesota gas prices top $4 a gallon for the first time since 2022, pushing used EV sales up 54% in March as drivers seek relief at the pump.

Minnesota drivers are feeling the squeeze at the pump, and a growing number are responding by ditching gasoline altogether.

Data from AAA shows the statewide average for a gallon of regular gasoline in Minnesota has climbed to about $4, the highest level in four years. That price jump is pushing motorists to consider electric vehicles at a rate that auto dealers and analysts say is unprecedented. A recent study by Cox Automotive found used electric vehicle sales in March rose 54% compared to February, and more than 25% above the same period last year.

At G.S. Motors in Hopkins, a used EV-focused dealership, owner Pavel Ignatovich says the surge is reshaping his business.

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"Sales are doubled. Super busy, a lot of foot traffic. A lot of people call in. A lot of people come in for test drives, and a lot of people buying," Ignatovich told local news. His inventory is running thin. "Whatever is on my lot right now is 2 to 3 times less than normal."

Ignatovich is not alone. The Cox Automotive data reflects a broader national trend, but in Minnesota the effect is especially pronounced because gasoline prices have risen faster than the national average. California still leads the country with an average of $6 per gallon, but Minnesota's $4 threshold is a psychological barrier that has many drivers rethinking their commute.

Betsy Thomas, a Minnesota driver, says she is cutting back on driving and worried about ripple effects. "Cutting down our commutes, maybe going out a little bit less. I'm nervous about how this gas, the price of gas is going to affect things like groceries."

The math behind the switch

The U.S. Department of Energy estimates that switching from a gasoline-powered car to a fully electric vehicle can save a driver more than $2,000 per year in fuel costs. A hybrid saves about $1,500 annually. Those numbers are based on average driving distances and national electricity rates, but in a state where gas now costs $4 a gallon, the savings stack up quickly.

"Even if the gas prices go down, it's still a big difference," one driver told reporters.

The used EV market is particularly attractive right now. New EV prices remain high, and federal tax credits have complex eligibility rules. But used EVs, which have already taken their biggest depreciation hit, offer a lower entry point. The average used EV on the market is now several years old, and models like the Nissan Leaf, Chevrolet Bolt, and older Tesla Model 3 are available for well under $30,000.

Dealers see the shift firsthand

Ignatovich says the surge in interest is not a temporary spike. "EVs are selling themselves," he said. His customers range from first-time EV buyers to experienced electric owners looking to upgrade.

According to experts cited in the report, used EV sales growth is expected to continue through the end of the year. That projection aligns with typical seasonal patterns: more people shop for cars in spring and summer, and rising gas prices tend to accelerate interest in fuel-efficient vehicles.

But there are headwinds. Used EV prices have been volatile, and some shoppers worry about battery degradation and charging infrastructure, especially in colder climates like Minnesota. Winter cold can reduce EV range by up to 30%, and public charging stations are still less common than gas stations, especially in rural parts of the state.

Still, the economics are shifting. At $4 a gallon, a gasoline car that gets 30 miles per gallon costs about 13 cents per mile in fuel alone. An EV that gets 3 miles per kilowatt-hour, charged at the U.S. average residential rate of about 14 cents per kWh, costs less than 5 cents per mile. Even accounting for higher electricity rates in some areas, the margin is wide.

What this means for Minnesota's auto market

Minnesota is not California when it comes to EV adoption, but the gap is narrowing. The state offers its own rebates for new EV purchases, and utilities are installing more chargers. The combination of high gas prices and growing inventory of affordable used EVs is creating a tipping point for many households.

Cox Automotive's data suggests that nationwide, used EV sales are growing faster than new EV sales. That is partly because early adopters are trading in their older EVs for newer models, flooding the secondary market with relatively affordable options. For the first time, a buyer on a budget can choose a used EV over a used gas car and come out ahead on total cost of ownership within a year or two.

For drivers like Thomas, the decision is not immediate but the calculus is changing. "When I drove in, did I think, oh, I could probably go to Costco tomorrow?" she said, describing the hesitation every time she fills up. That pause is exactly what the EV market needs to keep its momentum.

The next few months will test whether the surge is durable or just a reaction to price spikes. But if gas stays near $4, the used EV lot will likely stay thin.

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Nina Rossi

Staff Writer

Nina writes about new car models, EV infrastructure, and transportation policy.

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