Are EVs Really Cheaper to Own and Drive Than Gas Cars?
Electric vehicles have grown more affordable throughout 2023, and many have found them even cheaper than driving gas cars over their lifespan. From reduced lifetime maintenance costs to savings on charging, can EVs really be cheaper than owning and driving gas cars?
Above: A Tesla Model 3 and an Audi E-Tron (Image: Casey Murphy / EVANNEX).
According to MarketWatch, EVs are typically going to come out cheaper than gas vehicles after years of being driven, but the question depends on a handful of factors. Starting with sticker price, many prospective EV buyers become hesitant due to higher MSRPs on the zero-tailpipe-emission technology. However, once considering your costs over a five- to ten-year lifespan of a new car, EVs will often come out significantly cheaper than gas for many buyers.
For example, Kelley Blue Book recently crunched the numbers comparing a new Tesla Model 3 to an Audi TT. What the publication found was that the Model 3 averaged $39,547 to own after five years, while the Audi TT had a five-year cost of about $63,075. Both figures were measured by accounting for the cost of gas or charging, as well as maintenance, repairs, auto insurance, depreciation and other factors causing out-of-pocket expenses.
KBB found the Model 3 has the cheapest five-year ownership cost of any luxury vehicle, though you can also find EVs that are both more affordable and more expensive at face value. The entry-level Model 3 trim costs $40,240 from Tesla before considering the $7,500 federal tax credit, or other regional rebates.
Consumer Reports auto editor Keith Barry recently pointed to EVs as being generally cheaper, though he also notes that isn’t always the case. Access to federal, state and local incentives on EVs may also cut the sticker price on EVs, though these are highly dependent on your region and the type of car you’re looking to buy.
“[An EV is] almost always is going to cost less to drive than a gas-powered car,” Barry said. As to whether operating costs can offset sticker prices, Barry adds that it “really depends on where you live and what kind of car you purchase.”
In the pickup sector, MarketWatch points to another Consumer Reports analysis which shows that buyers on the West Coast could be poised to save on a Ford F-150 Lightning, since gas prices are high and electricity costs are low. Additionally, this analysis was made prior to the F-150 Lightning becoming eligible for the $7,500 tax credit, so the sticker price is even lower now for those who meet income requirements, and it’s almost certainly more affordable over time than an F-150 Hybrid.
Unfortunately, those looking within the three-row SUV segment will find fewer options on the market, as the scope of EVs is still emerging. Compact economy-level electric SUVs can be found around the $30,000 mark from some brands (read: Chevy Bolt, Nissan Leaf, etc.), though it’s debatable at this level whether year over year cost savings will amount to as much as in the luxury or pickup segments.
When buying an EV, shifting to regular charging is also noteworthy and can affect total savings. Charging at home during off-peak hours will almost always result in lower charging prices, while those regularly charging on the road may not stand to save as much. You can also gain benefits from your utility company in some areas to build your own home charger. And as we mentioned earlier, areas with high gas prices are likely to yield even greater savings on charging.
Still, an analysis from Energy Innovation Policy and Technology this year shows that it’s cheaper to charge an EV than fill up a gas car in all 50 states, and it adds that most new EVs will ultimately be cheaper than gas cars in the course of their lifespans. Adding in other potential savings through programs like leasing, Barry says, may also result in increased savings in the years ahead.
“I actually think leasing is a sweet spot for EVs,” Barry added.“It’s too new a marketplace to know what’s going to happen to these cars when it comes to resale value, and leasing protects you against that.”
So, are EVs cheaper in the long run than gas or hybrid cars? In general, yes. But you should always do your own analysis, and you can utilize tools for identifying regional incentives through EV savings calculators from Kelley Blue Book and Consumer Reports.
===Sources: MarketWatch / Kelley Blue Book / Consumer Reports