02-05-2025
More Than Half Of All EVs Remain Costlier To Own Than ICE Cars, Study Shows
A new study shows that over half of the current fleet of EVs lose money in the long run compared to ... More their conventional-powered alternatives.
Aside from their zero-emissions operation, electric vehicles have been touted as money-savers with regard to their energy and maintenance costs. Yet a the recent annual EV Cost of Ownership Analysis conducted by the automotive market research company Vincentric shows that 56%of the current fleet of EVs still lose money in the long run vs comparable gas-powered models, due in large part to their higher up-front costs and steep rates of depreciation.
Vincentric compared ownership costs among 54 current EVs and found that 24 of them – 44% – had lower five-year ownership costs (with 15,000 miles driven per year) compared to comparable internal combustion engine models. This represents a slight decrease over the organization's study released in 2024, however, in which 49% of EVs investigated were cheaper to own over time than their ICE counterparts.
EV sales have long suffered from higher purchase prices, and while the chasm between battery and gas-powered models' sticker prices has slimmed down in recent years as a result of lower manufacturing costs and increased market competition, only five models of those studied now qualify for the one-time $7,500 federal tax credit. Originally enacted to spur electric-car sales, Biden administration rule changes now limit the credit based on a given model's component and manufacturing sources and retail prices, and is further limited by a buyer's household income. There's speculation the Trump administration could eventually eliminate the credit altogether.
On the plus side, the study determined that all 54 current EVs studied have lower five-year average energy costs than comparable ICE vehicles. Also, 74% of them enjoy lower maintenance charges, though this is down from 90% of all EVs in 2024. Because they utilize an electric motor and a simple single-speed transmission, EVs eliminate over two-dozen mechanical components that would normally require regular service. Driving an electric car means being able to avoid oil changes, cooling system flushes, transmission servicing and replacing the air filter, spark plugs, and drive belts.
What's more, all of the EVs examined were determined to be more environmentally friendly than ICE models, with their emissions-free operation being more than able to offset the impact of greenhouse gas pollution created in the generation of electricity. Vincentric found that EVs have the capability to reduce CO2 emissions by over 4.4 metric tons, NOx emissions by over 2.3 metric tons, and VOC emissions by over 1.7 metric tons in a five-year ownership period, versus ICE models.
'While our latest analysis of EVs in America has shown some decreases in cost-effectiveness from last year, the 2025 study still found that 44% of EVs cost less to own over five years than a comparable gas vehicle,' says Vincentric's president David Wurster. 'This means that, despite the oftentimes higher upfront cost, a wide variety of EVs can still save buyers money over another gasoline-powered car.'
Vincentric compared EVs to ICE models based on eight long-term ownership costs: depreciation, fees and taxes, financing, fuel, insurance, maintenance, opportunity costs and repairs. Of note, many states charge more for EV registrations to help compensate for revenue lost by avoiding gas taxes at the pump, and insurance premiums tend to be higher with EVs, largely because of the steep costs involved with replacing the battery and other high-tech components.
Depreciation is traditionally the highest ownership cost for all models, gas or electric, though EVs tend to lose their value more quickly as new models joining the market with higher operating ranges and other improvements tend to drive down older versions' resale values. Affordable EVs were found to lose far less of their original values in dollar amounts than more expensive models, with the these 10 models losing the least amount of their values over a five-year term:
As it turns out, despite their inherently high rates of depreciation, the biggest overall EV money-savers, compared to ICE models, are costly luxury models. As it stands, upscale cars of all kinds tend to have steeper rates of depreciation than more-affordable models, as well as costlier service and repair visits, which tends to even the proverbial playing field somewhat with regard to ownership costs.
These are the five EVs Vincentric determined will save an owner the most money over a five-year period, compared to similar ICE models:
