Welcome to the second of our running series of blog posts on electric cars. This week, we’ll be looking at the cost of electric car ownership. In future posts, we’ll also be posing questions on the costs of running electric cars and on maintenance of the vehicles, giving you the full picture on the costs of ownership and how this compares to conventional cars.
As always, there is still time to add your questions to be answered in our remaining blog posts of the series, so add your questions to our list.
Check back next week, or sign up for automatic updates using the ‘Follow Blog Via Email’ link on the right of this page, when we’ll be bringing you answers to a range of questions on the costs of electric car purchase and ownership.
As with last week’s questions, we’ve again spoken to Professor Phil Blythe, Professor of Intelligent Transport Systems and Director of the Transport Operations Research Group (TORG) and put your questions to him. Here’s how that conversation went.
Dr Sarah Sweeney, Theme Administrator, NIReS: Thanks for sitting down with us again, Phil, and answering more of our questions on electric cars.
Professor Phil Blythe: No problem at all. What’s the topic this week?
Sarah: We’d like to move on to looking at the costs of owning an electric car, as this is undoubtedly one of the main issues that puts a lot of people off. So, first of all, are electric cars a lot more expensive than conventional petrol or diesel cars to buy?
Phil: At the moment, the simple answer is yes, but this is always the case with new technologies. Electric cars currently have a high purchase price and, as they are so new, there are very few second-hand purchase options. The general consensus is that it would take a very long time for the cheaper running costs to outweigh the expensive purchase price. There is a £5,000 government subsidy available to those in the UK wishing to purchase an electric car though and, as more come on to the market, prices will drop and more second-hand vehicles will become available, so the situation will improve over the next few years.
Sarah: So, if you decided to take the plunge and buy one, what about the day-to-day running costs? Does it work out much cheaper to run an electric car than a petrol or diesel car?
Phil: Yes, running costs are definitely much cheaper. Comparing an electric vehicle (EV) doing 10,000 miles a year to a petrol equivalent saves more than £3,000.This is because electricity is cheaper than petrol and not subject to fuel tax, plus electric cars are more efficient than their petrol equivalents. In addition, servicing and maintenance is minimal as there are fewer moving parts in an electric motor (the only part which will require maintenance is the batteries) and, if you live in London, electric cars are exempt from the congestion charge.
Sarah: So that’s good news! What about road tax? Do EV owners have to pay the same?
Phil: No, in fact, electric vehicles are exempt from road tax, due to their low emissions, so this also helps contribute to the £3,000 per year saving I mentioned.
Sarah: What about insurance? For a lot of drivers in the UK, particularly younger drivers or those over a certain age, insurance is a significant part of the cost of car ownership. How do electric cars compare to conventional vehicles on that front?
Phil: As electric cars are relatively new, it can be slightly more tricky to sort out insurance for them (some insurance companies may not have heard of the make or model). But this is improving, and most major insurers are happy to insure them and you may even receive a discount. However, at present it does generally seem to cost more to insure an electric car than a petrol one: this would seem to be due to the lack of statistics for electric cars involved in accidents, their high acceleration, the high value of their batteries (which could be seen as a target for thieves) and the assumed higher costs for repairs should the car be damaged (this is partly due to expensive batteries and partly due to the fact that not all garages may be suitably equipped to fix electric cars, meaning dealerships are the most likely place for a repair job).
Sarah: So there seem to be a lot of factors to consider from a cost point of view if thinking of buying an electric car. You mentioned earlier that it’s generally thought that, as things stand, it will take a while to recoup the purchase price of an electric car. Do you have any thoughts on how long we’re talking about?
Phil: Obviously this would depend on the model of electric car purchased. The Peugeot iOn, for example, now costs only £13,000; with the cheaper running costs of an electric car predicted to save you £3000 per year, you should break even after 3 or 4 years. But that assumes that you’re comparing the cost of buying an electric car against not buying a car at all, which for most people won’t be the case, so depending on which model of petrol or diesel car you would otherwise be thinking of buying, the time to recoup the difference in cost could be quite short. Then, obviously, once you’ve recouped your purchase price (or the extra cost of going electric), you’re going to see significant savings from that point onwards.
Sarah: You mentioned earlier that one of the factors driving up the price of electric cars is the fact that they’re only currently available from new. If someone either couldn’t afford a new car, or would prefer not to suffer the depreciation on buying from new, does that rule out a switch to electric cars altogether for them?
Phil: Not necessarily, no. There are an increasing number of car clubs in the UK and globally which seek to encourage people to swap private car ownership for membership and use, as needed, of a fleet of cars. A number of these clubs either now have electric cars as part of their fleet, or are investigating the use of EV technology, so it’s probable that, in time, you wouldn’t need to buy an electric car in order to be able to switch to an EV. These clubs also offer additional savings against private car ownership (particularly if your car usage isn’t particularly heavy). It also works the other way round: some of these clubs allow private car owners to sign up to have their cars included as part of the fleet, meaning that, when you don’t need your car, you can recoup some money by hiring it out. For example, in the North East, we, as a University, have partnered with Commonwheels Car Club to trial the use of an electric vehicle for University staff, as part of their aim to roll out electric cars as part of their fleet.
Sarah: Fantastic, thanks Phil. We’ll have some more questions for you and the team next week on what it’s like to drive an electric car, if that’s OK?
Phil: Of course, see you then.