Comparing costs: EV vs ICE
Total cost of ownership comparison
The cost gap between electric and internal combustion engine cars (ICE) is shrinking each year and, in some situations, EVs are now cheaper to run. When comparing costs it’s essential to look at the total cost of ownership. Some cost components are more expensive for EVs like tyres while others are much cheaper like energy. However, a lot of factors influence these savings. The total cost of ownership is made up of the following cost components.
Electric cars seem to depreciate a bit more than internal combustion engine (ICE) vehicles, because of the fast technology advancements. With leasing an electric vehicle, the amount you pay is based on the expected rate of depreciation. In the case of electric cars, as well as enjoying lower monthly payments, EV leasing is also a safe way to protect yourself against new technology in the field. EVs are almost certain to be more advanced at the end of a two, three or four-year lease. At the end of your contract, you simply hand the car back and take out a new lease on a brand new EV which has the latest tech.
Charging your car at home will also cause your electricity bill to rise, but how much will depend on factors like when you charge and where you live. Electricity costs can vary significantly by region. Keep in mind that charging your car overnight, can save you 30 percent on that charge. Public charging stations tend to be more expensive than charging at home. The cost of charging your electric car at a public charge point depends on the charge point network and the location of charge points. Many local authorities offer a pay per session approach to on-street chargers. Public charge point costs also vary depending on the power rating.
Electric and electrified powertrains have lower maintenance and repair costs than internal combustion engine (ICE) powertrains for all vehicle sizes, relative to vehicle price. Based on our TCO report we can say it is 11% lower. Electric cars have far fewer moving parts than internal combustion engines (ICE), meaning that electric car service costs are much lower when compared to ICE vehicles. Despite that, they do still require some regular maintenance that incurs cost, such as: tyres and brakes, windscreens, wiper blades and washer fluid, battery repair or replacement (rare!), general wear and tear.
Drivers must note that since EVs run on batteries, the tyres need to carry the weight of the batteries as well. Therefore, they should have a solid construction and strong tyre compound to withhold such weight. EV tyres must have a stronger sidewall and robust compound (Nylon or heavier) to handle the weight of the battery and the car components.
All vehicles are getting more complex, including ICE vehicles, in terms of high-tech features and far more sophisticated electronics that are expensive to replace. Repair facilities have to make investments in new equipment and training to work on EVs. While ICE vehicles also have more Advanced Driver Assistance Systems (ADAS), EVs are really packed with these features and they are expensive to replace. Battery packs make EVs heavier than similar-sized ICE vehicles. It also means that EVs make greater use of expensive, lightweight, high-strength materials to try and offset the battery weight. These materials are expensive to replace.
Generally, electric cars cost around 12% more to insure than ICE vehicles. Because electric vehicles are pricier to both buy and repair, insurance providers charge more for coverage. That said, the savings you earn on gas and tax incentives might more than make up for your extra cost.
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Are EVs cheaper to drive than ICE vehicles?
When it comes to EVs, fuel and vehicle maintenance costs are the primary factors in driving down the TCO. According to research by LeasePlan, the total cost for electric vehicles - in most situations in Europe - are already cheaper than ICE vehicles, assuming costs are averaged over the first four years of ownership and an annual mileage of 30,000 km.