Owning an electric vehicle (EV) can save you $6,000–$10,000 over a lifetime compared to an internal combustion engine (ICE) car. Still, there are some additional costs that you must know before buying an EV. It includes servicing costs, charging infrastructure, and expected battery replacement over time. In this blog post, we’re going to dive deep into the hidden costs of owning an Electric Vehicle (EV) so that you can make a confident decision when making your next investment.
What factors drive up the price of EVs?
The purchasing cost of electric vehicles (EVs) is often a major factor that keeps people from making the switch. There are numerous factors that contribute to the high price tag of EVs, such as battery costs, production costs, and maintenance costs.
Today, the average price of a new electric vehicle is $56,437, about $10,000 more than the industry average. However, most electric cars have tax concessions totaling nearly $12,500. The initial purchase price may seem a little high, but it may be justified, given the potential benefits of owning one.
Before buying an electric car, it is vital to understand the cost of owning an electric vehicle, including upfront payments, ongoing maintenance costs, registration fees, insurance premiums, etc. Here, we’ve covered eight hidden factors that make electric cars more expensive.
8 Invisible Costs of Owning an Electric Vehicle
Generally, a full gas tank costs about 20–40 cents per gallon in the gas tax, which would be used towards repairing the roads. However, if we drive an EV, we don’t have to pay that gas tax. Most US states have included this in their EV tax in recent years. This ranges from about $50 to over $200 per year. Soon, the tax would increase to $300 per year as well.
Tires are unexpected hidden costs that we usually don’t consider. It costs more to replace worn tires. EV tires tend to wear out much faster than expected because the EV weighs much more than its gasoline equivalent and hits 100% torque immediately.
The tires will cost around $200-$300 and must be replaced after about 20-25,000 miles. On the other hand, for a lighter, lower-torque non-EV, you can expect tires to last closer to 35 to 50,000 miles and probably cost a little less.
The cost of charging plays an important role in altering the cost of EVs. A typical home charger costs between $400 and $700; if you use it to charge your EV daily, the electricity bill would be higher.
In California, level 1(120V) fast charging costs about 30 cents per kilowatt hour, while level 2 (240V) charging costs three times more. In certain stations, charging with a Tesla Supercharger costs $1 per minute, but after four hours, particular charging stations charge $20 per hour.
Increased Repair Costs
Some electric vehicle repairs tend to cost more than gasoline ones. For example, a Tesla’s average annual repair cost is $832, which is higher as compared to $652 for all other vehicle types. Concerning parts replacement, consumable shortages can also lead to increased costs.
There may also be a question of who can fix your car. Automotive mechanics for an electric car may not be as cheap as for an internal combustion engine. Vehicle manufacturers may have restrictions on who can repair certain types of vehicles.
You must know: 6 Key Differences Between Electric Cars vs Gas Cars
Insurance rates for the EV are likely to be higher than for conventional gasoline vehicles. Electric vehicles typically cost about 25% more to insure than gasoline vehicles. One factor increasing insurance costs is the potential cost of EV repair and replacement. Specific reports claim that EVs are expensive to repair or replace and must charge extra for compensation.
Additionally, only a few certified repair shops have the necessary equipment and expertise to improve electric vehicles. Therefore, qualifying facilities may charge more for repairs. Electric cars cost 5%–20% more than gasoline-powered vehicles.
The EV manufacturer’s warranty typically covers batteries for eight years or 100,000 miles, whichever comes first. But what if the battery dies after the contract expires? In the last five years, most electric vehicles have been sold. As cynical as it sounds, most batteries have never failed.
But replacing what you already have is expensive. According to a meta-analysis conducted by Recurrent Auto, the average cost (parts and labor) to return a battery ranges from about $12,000 for a Nissan Leaf to about $22,000 for a Tesla Model S.
According to LendingTree, a car loses about 35% of its value in an average of three years. However, for electric vehicles, it is 52%. Some electric cars depreciate even faster. This is the gradual depreciation of an asset over time, primarily through wear and tear.
For example, the price for the Tesla Model S is $106,190, and the depreciation cost would be 50% of the actual price, which would be $53,095.
EV Maintenance Cost
EVs require less maintenance than internal combustion engine vehicles, as no oil changes, air filter changes, or engine maintenance are needed. Therefore, the cost of tires, lights, brakes, and other ancillary costs can be included in maintenance costs, which would cost up to $500 over a period of five years.
The hidden costs of owning an electric vehicle may seem daunting, but they are well worth it in the long run. By investing in an EV, you will be contributing to a cleaner and more sustainable future. Not only that, but you can also save money on fuel costs and maintenance expenses over the life of your electric car.
Plus, with government incentives and tax breaks available for EV owners, it’s becoming easier to offset the upfront cost of purchasing an EV. With so many benefits to owning an electric car, it’s easy to see why this type of vehicle is quickly gaining popularity amongst drivers across the globe.