Will an EV save me money?

Increasing fuel prices are motivating more Australian drivers to consider switching from a petrol vehicle to an EV, but will making the switch actually put more money in your pocket?

Here's the breakdown of the potential cost savings of trading the petrol pump for the power socket.

Will buying an electric vehicle save you money?

the short answer is yes, an electric vehicle (EV) can save you money in the long run compared to a petrol-powered vehicle. While the initial cost of an EV may be higher than a petrol-powered vehicle, EVs are cheaper to operate because they are more efficient and have lower fuel costs.

One of the main cost savings of an EV is its lower fuel costs. Electricity is generally cheaper than gasoline, so fueling an EV will typically cost less than filling up a gas-powered vehicle.  Additionally, EVs are more efficient than gas-powered vehicles, so they can go further on a single charge, which can save you money on fuel costs over time.

EV running costs V petrol car running cost

The  Australian Electric Vehicle Council says that powering an EV is around 70 per cent cheaper than powering a petrol car and on average can save EV drivers about  $1600 in fuel costs.  

According to the Electric Vehicle Council, the average cost of fuel for a petrol vehicle is $1.50 per litre. In comparison, the equivalent cost of running an electric car is 0.33c per litre. That's a saving of $1.17. 

With the average Australian driving 15,000km per year, this equates to a cost of $0.14 per km for petrol cars and 0.04c per km for EVs. Fuel cost per year for 15.000 km petrol car is $2100 versus the fuel cost per year for an EV driving the same distance $600.  

Are EV's easier to service?

Yes, electric cars are generally easier to service and more cost-effective to own compared to gas-powered cars. One of the reasons for this is that electric cars have fewer moving parts than gas-powered cars, which means there are fewer parts that can wear out or break down. This makes electric cars less likely to need expensive repairs and makes them easier to service.

Additionally, electric cars are generally simpler to maintain because they don't require regular oil changes and other maintenance tasks that are necessary for gas-powered cars. This can save you time and money on regular maintenance, and make electric cars more convenient to own.

Another way that an EV can save you money is through government incentives and tax breaks. In many places, EVs are eligible for tax credits and rebates, which can help offset the initial cost of purchasing an EV. Additionally, some cities and states offer reduced rates for EV charging and other perks, such as access to carpool lanes, which can save you money on fuel and tolls.

EV Car Depreciation

Another benefit of electric cars is that they tend to depreciate at a slower rate than gas-powered cars. Depreciation is the decline in value of a vehicle over time, and it is a significant cost for car owners.

Studies have shown that electric cars tend to retain their value better than gas-powered cars because they are in high demand and have a longer lifespan. The battery packs in electric cars are also designed to last for many years, which can further increase their resale value.

This means that when you decide to sell your electric car, you are likely to get a higher price for it than you would for a gas-powered car of the same age and condition. This can save you money and offset some of the initial cost of purchasing an electric car.

Overall, electric cars are not only cheaper to operate and maintain, but they also tend to depreciate at a slower rate than gas-powered cars. This makes them a more cost-effective option for many car buyers.

The Verdict

While the initial cost of an EV may be higher than a petrol-powered vehicle, its lower fuel and maintenance costs can save you money in the long run and with a host of affordable new electric vehicles set to hit the Australian car market in 2023, including a great range of cheap EV's for those of you on a tight budget,  this year now could be the perfect time to make the switch