Electric vs. Gas Cars: True Cost of Ownership Guide

Electric vehicles (EVs) present substantial long-term savings, while gas-powered cars continue to be more affordable at the time of purchase. Below is a detailed breakdown to help determine which option aligns best with your financial and driving needs.

• Upfront Costs

  EVs come with an average price tag that is $5,804 higher than traditional gas cars in 2025. However, federal tax credits of up to $7,500 help narrow this initial difference, making EVs more competitive in pricing.

• Fuel & Charging Expenses

  The cost of charging an EV at home falls between $500 and $800 per year, depending on electricity rates. In contrast, fueling a gas vehicle costs between $2,000 and $2,220 annually, making EVs significantly more cost-effective in daily operations.

• Maintenance & Repairs

  On average, EV maintenance is 31% less expensive than that of gas cars. With fewer moving parts and no need for oil changes, EV owners spend less on upkeep over time. Gas vehicles require frequent maintenance such as oil changes, brake servicing, and transmission care, leading to higher long-term costs.

• Insurance Costs

  Insurance premiums for EVs tend to be about 15% higher than those for gas-powered cars. This is due to the specialized components and repair processes involved with electric models, which can increase replacement costs.

• Resale Value

  The resale market for EVs is improving, particularly for premium models such as Tesla, which tend to retain their value better than many traditional vehicles. As technology advances, the depreciation rates of EVs are becoming more competitive.

Quick Comparison

Cost Factor	EV (15 years)	Gas (15 years)
Upfront Costs	Higher	Lower
Energy/Fuel	$28,500	$35,460
Maintenance	$5,400	$10,800
Insurance	Higher	Lower
Resale Value	Improving	Competitive

Bottom Line

Over a 7 to 15-year period, EV owners can expect to save between $7,000 and $11,000 compared to gas vehicle owners. However, gas cars may still be preferable for those on tighter budgets or living in areas with limited charging infrastructure. Choosing the right vehicle depends on personal driving habits, local energy costs, and long-term financial goals.

Electric Car vs. Gas Costs: Which Option Saves More Money?

1. EV Ownership Costs

Purchase Price & Incentives

The starting price for an EV begins at $32,875 for base models such as the Hyundai Kona Electric SE. Buyers can benefit from federal tax incentives of up to $7,500, reducing the initial cost burden. For example, a Chevrolet Equinox EV, priced at $41,100, could see its cost drop to $33,600 after incentives.

Charging Costs

Charging an EV at home is the most economical option. Electricity rates typically range from $0.12 to $0.24 per kWh, leading to full charge costs of $6 to $18. Public charging stations, while convenient for long trips, come at a higher cost of around $0.30 per kWh, bringing the total per charge to $20 to $40.

Charging Type	Cost per kWh	Full Charge Cost
Home Charging	$0.12-$0.24	$6-$18
Public Charging	$0.30+	$20-$40
Annual Cost (Home)	N/A	$500-$800

Maintenance & Repairs

EVs incur lower maintenance costs compared to gas-powered vehicles. On average, EV owners spend $949 per year, whereas gas vehicle maintenance costs around $1,279 annually. The 31% savings come from EVs’ simpler mechanical structure, which eliminates the need for oil changes and spark plug replacements. However, routine services such as tire rotations and brake maintenance remain necessary.

Insurance Expenses

Due to their specialized parts and repair requirements, EV insurance premiums tend to be higher. Annual costs range from $2,007 for a Chevrolet Bolt to $4,364 for a Tesla Model X, reflecting the added expense of replacing and repairing electric components.

Resale Value

The resale market for EVs continues to strengthen, especially for high-demand models like the Tesla Model 3, which retain their value better than many other electric and gas cars. Additionally, most EVs come with battery warranties spanning 8 to 10 years or 100,000 to 150,000 miles, reinforcing long-term reliability and value.

2. Gas Car Ownership Costs

Purchase Price & Depreciation

The cost of gas vehicles varies widely, with compact SUVs starting at $21,495 and larger models ranging from $57,520 to $82,690. Gas cars typically depreciate at a rate of 15-20% annually within the first few years, although certain models, such as the Toyota Camry, maintain stronger resale value.

Fuel Costs

Fuel expenses are a significant factor in gas vehicle ownership. With gasoline averaging $3.70 per gallon and an estimated fuel efficiency of 25 miles per gallon, a driver covering 15,000 miles annually will spend between $2,000 and $2,220 on fuel.

Cost Category	Annual Expense
Fuel	$2,000-$2,220

Routine Maintenance

Gas vehicles require frequent servicing, adding about 35% more in maintenance costs compared to EVs. Standard maintenance includes:

• Oil changes: $35-$75 every three months
• Tire rotations: $20-$50 twice a year
• Brake servicing: $150-$300 per axle every 3-5 years

Insurance Costs

Gas vehicle insurance averages around $1,900 per year, approximately 15% lower than EV insurance rates. The lower cost is due to the widespread availability of mechanics and replacement parts for traditional vehicles.

Unexpected Repair Expenses

Over time, gas vehicles are more prone to major repairs. Common costs include:

• Catalytic converter replacement: $1,000-$2,500
• Transmission servicing: $80-$250 every 30,000-60,000 miles
• Engine repairs beyond warranty coverage

3. Direct Comparison: EV vs. Gas

Purchase & Initial Costs

The price gap between electric and gas vehicles is closing. By the end of 2024, the average EV cost $55,544, compared to $49,740 for all new cars combined.

Long-Term Ownership Costs

A 15-year cost analysis reveals distinct financial advantages for EVs.

Cost Factor	EV (15 years)	Gas (15 years)
Energy	$28,500	$35,460
Maintenance	$5,400	$10,800
Total	$71,460	$79,704

Energy Efficiency & Fuel Savings

EVs operate at an efficiency level 2.6 to 4.8 times greater than gas-powered vehicles, delivering substantial fuel cost reductions for most drivers.

Regional Cost Variations

Electricity and gas prices differ by location. In Washington, where electricity costs $0.10 per kWh, EVs are 80% cheaper to operate than gas cars. In California, where rates reach $0.27 per kWh, the savings drop to 40%.

Additional Considerations

Potential costs include home charger installations ($500-$2,000) and battery replacements beyond warranty ($5,000-$15,000). Despite these factors, EVs typically provide savings between $7,000 and $11,000 over 7 to 15 years.

Conclusion

EVs offer long-term financial benefits, especially for high-mileage drivers. However, gas vehicles remain a practical choice for individuals in rural areas or those with limited access to charging stations. Evaluating local energy costs, driving patterns, and financial priorities can help determine the best option.