Cost of Owning an EV vs. a Gas Car

One of the biggest questions for anyone considering an electric vehicle is: how does the cost of owning an EV really compare to a traditional gas-powered car? There are many factors to consider – purchase price, fuel (electricity vs. gasoline), maintenance, insurance, and more. In this article, we’ll break down the total cost of ownership for EVs versus gas cars. The goal is to give a clear, apples-to-apples comparison over the life of the vehicle. You might be surprised to find that, while EVs can have a higher sticker price, they often end up saving money in the long run. Let’s dive into the details.

Purchase Price and Incentives

At first glance, new electric cars tend to have higher MSRP than comparable gas models – but the gap is closing rapidly. As of mid-2025, the average transaction price for a new EV was around $57,700, versus $48,800 for a new gasoline car[39][40]. That’s roughly a $9,000 difference. This difference largely comes from the cost of batteries, which are still a pricey component (though battery costs have fallen dramatically in the past decade). However, that sticker price doesn’t tell the whole story:

• Federal and State Incentives: Many countries offer incentives to bring down the effective purchase cost of EVs. In the U.S., a federal tax credit of up to $7,500 is available for many EV models (subject to battery sourcing and income qualifications)[41][42]. Some states add their own rebates or credits on top – for example, Colorado has a $5,000 state credit in 2025 for EV purchases, and other states offer $1,500–$2,500 rebates. These incentives can significantly shrink or even eliminate the price gap. That $57k average EV could effectively cost under $50k after the federal credit, almost matching the average gas car price.

• Dealer and Manufacturer Discounts: The EV market in 2023-2025 saw automakers cutting prices to boost sales. We’ve seen dramatic price drops on models like the Ford Mustang Mach-E and Chevy Bolt. Some slow-selling EVs had hefty dealer discounts (e.g., an electric Dodge model had over $10k in discounts in early 2025)[43][44]. Competition is increasing, so bargain shopping for an EV can yield great deals.

• Used EV Prices: On the secondhand market, EVs can be very affordable. Early models like 5-year-old Nissan LEAFs or BMW i3s often sell for well under $15,000. And as more mid-range EVs (with 200+ mile range) hit the used market, buyers can find electric options comparable in price to used gas cars, with the added benefit of lower running costs going forward.

It’s also worth mentioning that automakers are introducing more entry-level EVs. For example, GM has an upcoming Equinox EV slated to start around $30,000, and Nissan’s Leaf and Chevy Bolt have been among the least expensive EVs (around $27k–$30k before incentives). Meanwhile, the cost of batteries (and thus EV manufacturing) is expected to continue dropping, which should bring MSRPs closer to parity with gas vehicles by the late 2020s.

Bottom line: While you may pay a bit more upfront for an EV today, incentives often erase much of that difference. And when considering total cost, upfront price is just one piece of the puzzle – we must also look at the day-to-day savings.

Fuel Costs: Electricity vs. Gasoline

This is where EVs usually shine. Electricity is generally much cheaper than gasoline per mile driven. Let’s compare on an annual basis:

• The U.S. Department of Energy found that the average cost to fuel an electric car is about $485 per year, versus $1,117 per year for a gasoline car (based on typical driving habits)[36][45]. That was from a 2018 study, but the principle still holds. In 2023, a report by Energy Innovation found EV drivers save around $800–$1,000 per year on fuel on average, and every EV model in every state was cheaper to “fill” than its gasoline equivalent[46][47].

• Why so much cheaper? EVs are far more efficient (using 3-4 times less energy per mile), and electricity prices per unit of energy are lower than gasoline. For example, if you drive 12,000 miles a year and your EV consumes 0.3 kWh per mile, that’s 3,600 kWh. At a national average of ~$0.14/kWh for residential electricity, that’s about $500 a year. A comparable gasoline car might use 400 gallons in that time. At, say, $3.50 per gallon, that’s $1,400 a year. This is just an illustrative example – your costs depend on local electric rates and gas prices – but generally EVs cost about half or less per mile to fuel.

• Furthermore, electricity prices are more stable than gasoline. Gas prices fluctuate with global oil markets, geopolitical tensions, etc., leading to price spikes at the pump. Electricity rates are regulated and tend to change gradually. Many utilities also offer time-of-use plans where you can charge your EV overnight at a discount. Smart EV owners schedule their charging for when rates are lowest (often equivalent to paying $1/gallon or less in energy terms). Gas car owners don’t have an option to “fuel when it’s cheap” – you pay whatever the price is when you need gas.

• Public fast charging can be pricier (sometimes $0.30–$0.50 per kWh, which could make an EV road-trip cost similar to gas in energy terms). However, most EV miles are “refueled” at home, and even public charging is often cheaper than gasoline per mile. Plus, some EV manufacturers throw in free charging credits for a couple of years.

Let’s not forget maintenance of fueling infrastructure: a home charger installation might cost $1,000-$2,000 upfront (if you need a 240V outlet or a dedicated charging unit). But that’s a one-time cost and can be rolled into home improvement/real estate value. Gas cars don’t have that cost, but you do pay with your time driving to gas stations regularly. Charging at home is incredibly convenient – it’s like having a personal fuel station that fills your car while you sleep.

Over a typical 5-year or 10-year ownership, fuel savings can stack up to thousands of dollars in favor of the EV. As an example, Plug In America estimated that over 10 years, an EV owner might save about $7,500 in fuel compared to a similar gas car[48][49]. Fuel prices vary, but unless electricity in your area is extremely expensive (or gas is unusually cheap), the EV will win on energy costs.

Maintenance and Repair Costs

Electric vehicles generally cost less to maintain than gas cars. The reason is simple: EVs have far fewer moving parts and fluid systems that require regular service. Here are some comparisons:

• Routine Maintenance: EVs don’t need oil changes (no engine oil), no spark plugs, no timing belts, no exhaust system repairs, and typically have less wear on brakes due to regenerative braking. The main regular service items are tire rotations, cabin air filter changes, wiper blades, and brake fluid flushes (occasionally). In contrast, a gasoline car over, say, 100,000 miles will need dozens of oil changes, maybe a couple of transmission fluid changes, air filter and spark plug replacements, exhaust muffler or catalytic converter fixes, etc.

• According to the U.S. Department of Energy and consumer studies, EV maintenance and repair costs run about 40% lower per mile than for gasoline vehicles[38]. One analysis by AAA found that scheduled maintenance for EVs was significantly cheaper over the first 5 years.

• Over a 5-year period, one might spend roughly $3,000 on maintenance for a typical gas car (including oil changes, brakes, tune-ups). For an EV, that might be closer to $1,500 or less in the same period. Over the long term, Plug In America calculated an EV could save about $2,400 in maintenance over 10 years compared to a gas counterpart[50][51].

• Repairs: EVs are not immune to repairs – things like suspension, steering components, or electronics can fail just as in any car. However, the big expensive engine-related failures (blown head gasket, timing chain, etc.) simply don’t exist in an EV. The electric motor has one moving piece (the rotor) and is extremely durable. The battery is the one major component to watch, but as discussed in Myth #3 above, they usually last the life of the car. Most EV batteries are warrantied for 8 years/100k miles, and manufacturers often cover them if capacity drops too much in that period.

• Brake life: Thanks to regenerative braking (using the motor to slow down and recapture energy), EV brake pads last much longer. Some EV owners report going well over 100,000 miles without needing a brake job because the mechanical brakes are used sparingly. This further lowers maintenance costs.

One caveat: tires. EVs tend to be heavier (due to the battery) and have instant torque, which can wear tires a bit faster. You might find you replace tires slightly more often on an EV, especially performance models, which could add some cost. But this varies – and is often offset by the savings elsewhere.

Also, insurance falls under ownership cost: currently, insuring an EV can be somewhat more expensive than a comparable gas car. A study found EVs cost about $442 more per year to insure on average[52][53]. Why? Primarily due to higher repair costs for body damage (aluminum frames, specialized parts) and the fact that EVs are often newer and higher-value vehicles. However, insurance rates are starting to even out as EVs become mainstream and more data on their safety and theft rates becomes available. Some insurers also offer discounts for EVs or for using telematics. It’s wise to get insurance quotes when car shopping to compare.

Other Ownership Costs: Taxes and Resale Value

Beyond purchase, fuel, and maintenance, consider a few additional factors:

• Vehicle Taxes/Fees: Since EV drivers don’t pay gasoline tax, some regions have introduced EV registration fees to fund roads. For example, states like Georgia or Illinois charge an extra $200 or so annually for EV registration. It’s something to be aware of – these fees can offset some fuel savings. In about 30 U.S. states, EV owners pay higher fees than what the average gas driver pays in gas tax[54][55]. These policies are evolving, but add maybe ~$100/year on average in costs for EVs in those areas.

• Resale Value: How well do EVs hold their value compared to gas cars? This has been mixed. Some early EVs depreciated quickly (due to rapid tech improvements and expiring tax credits – a new buyer wouldn’t get the incentive on used). However, certain models like Tesla’s have held value very strongly, sometimes better than gas equivalents, because of high demand. In general, as EV technology stabilizes and demand grows, we can expect solid resale values. It’s likely that popular long-range EVs will hold value as well or better than average. Still, this can impact cost of ownership. If an EV depreciates, say, 50% in 5 years versus a gas car 40%, that difference is a cost. On the flip side, in some markets used EV prices shot up due to fuel price spikes or supply shortages. For a fair TCO, consider depreciation trends for the models you’re interested in.

• Longevity: An often overlooked aspect – EV powertrains could last longer with less performance degradation over high mileage. There are Tesla taxis that have done 300k+ miles on the original battery and motor. If an EV can remain in service longer (with perhaps a battery module replacement down the line), the cost per mile can become very low. Gas engines, with many moving parts and explosions inside, eventually wear out or require expensive overhauls. It’s conceivable that an EV could have a useful life that’s several years longer than a comparable ICE vehicle, which would further tilt economics in favor of the EV. We’re still gathering data on this as high-mileage EVs accumulate.

Real-World Example: EV vs. Gas Over 5 Years

Let’s bring it all together with a hypothetical comparison. Imagine two compact SUVs – one electric, one gasoline – both similar size and features:

• Electric SUV: Costs $50,000 new. Qualifies for a $7,500 tax credit, so effective price $42,500.
• Gas SUV: Costs $42,500 new (for comparison after incentives).

Assume we own each for 5 years and drive 12,000 miles/year.

Fuel:
- EV: 3 miles per kWh efficiency = 4,000 kWh/year. At $0.14/kWh home rate, that’s $560/year. Maybe add $100/year of public charging. So ~$660/year. 5-year total ≈ $3,300.
- Gas: 25 MPG, so 480 gallons/year. At $3.50/gal, that’s $1,680/year. 5-year total ≈ $8,400.
Fuel savings with EV ≈ $5,100 over 5 years.

Maintenance:
- EV: Minimal maintenance. Let’s say $200/year average (tires, fluid checks, etc.). 5-year ≈ $1,000.
- Gas: Maybe $600/year (oil changes, brakes, filters, tune-ups, minor repairs). 5-year ≈ $3,000.
Maintenance savings with EV ≈ $2,000 over 5 years.

Insurance:
- EV might be a bit more expensive. Suppose EV costs $100/year more to insure. 5-year extra ≈ $500.
- (This depends on vehicle, but we’ll include it.)

Upfront difference after incentives: EV cost $42,500 vs Gas $42,500 in our setup (we made them equal with the credit). If no credit, then EV was $7,500 more upfront.

Even if the EV had a higher net purchase price, the fuel + maintenance savings in 5 years (~$7,100) largely compensate. Over a longer 8-10 year period, the EV comes out ahead by an even larger margin as savings accrue. The specific numbers will vary by model and personal usage, but numerous studies (from Consumer Reports, NRDC, etc.) have shown that EVs often have a lower total cost of ownership over the vehicle’s life. One 2025 analysis of popular models found EVs were cheaper in 4 out of 5 vehicle categories when looking at total five-year ownership costs[56].

The Verdict: EV vs Gas Cost

So, is it cheaper to own an EV or a gas car? In many cases the cost is already comparable or lower for the EV, especially when factoring in incentives and long-term savings. Upfront prices for EVs can be higher, but fuel and maintenance savings can more than offset that over time. Every situation is different – if you drive very little, fuel savings are less important; if you can’t charge at home and must rely on pricier public stations, your costs may differ. However, for the typical driver, an EV can absolutely be a financially sound choice.

Moreover, there are intangible “value” factors: EVs offer a smooth, quiet ride and instant acceleration, they don’t require gas station visits (time saved), and they produce no tailpipe emissions (benefiting air quality and potentially avoiding future carbon fees). Some cities even offer perks like free parking or HOV lane access for EVs, which, while not monetary, add convenience value.

In summary, the cost of owning an EV is highly competitive with owning a gas car. We’ve moved past the era when EVs were niche, expensive experiments. Today, you can find an electric vehicle for nearly every budget and need, and when you run the numbers, you might discover that going electric saves you money in the long haul. Always consider the total cost of ownership, not just the sticker price, when car shopping. The economics of EV vs. gas are now tilted more in the consumer’s favor than ever, and they will only improve as technology advances. This is the end of this article.