Costs of owning an Electric Cars vs Petrol Cars

Choosing an electric car over a conventional car can potentially result in long term savings. However you will need to know where your costs will come and the advantages and disadvantages of ownership.

Let’s compare the cars.

Electric cars and internal combustion

• How do they work?

Internal combustion works via petroleum in a controlled explosion that drives the engine which subsequently turns the wheels. Electric cars however work via large battery packs which deliver electricity to an electric motor.

The University of Michigan's Research shows ICEs car run on petroleum/gasoline costs an average $1,117USD while an electric car costs $485 per year,

? Energy Utilisation:

When you utilise petroleum without a battery the energy is completely lost when you break to heat and sound. You can have a hybrid vehicle but this would add weight and complexity. Mixing two technologies causes an increase in servicing cost which offsets savings in petrol consumption. An electric car does not have this issue. Regenerative breaking allows the battery to recharge when the brakes are applied.

To compare an EC motor according to the energy council is 85 - 90 % efficient and when we consider the entire process which includes the electric car charging they covert over 80 per cent of the electrical energy from the grid to power at the wheels. A petroleum car on the other hand due to the amount of moving parts, heat generation, sounds and more is only 27% efficient. There’s only one winner here. A Nissan Leaf charging station will deliver yearly savings contributing to the lower operational and lifetime cost.

• More Moving Parts.

A petrol car has almost 2000 moving parts along its drivetrain compared to an electric cars 30 parts in the drivetrain! This has two effects, a reduction in efficiency and an increase in serving costs with petroleum based cars. The majority of an electric cars costs are associated with the batteries.

The engine is already cheaper to manufacture. This author believes that it’s this simplicity in an electric car that will ultimately see their costs come down to a point where they can be build cheaper than a conventional car. Battery prices are falling fast. At $100 /kW we can already see price parity

Manufacturing costs

To use Ford as an example – the average sale price is $22,000 USD with a profit of $2,000. Meaning it costs $20,000 to manufacture.

With the Hyundai IONIQ Electric an example the cost is closer to $40,000 while the Hyundai i30 1.4 T-GDI will set you back around $27,000.That means the electric version is around 34% more expensive than its petrol counterpart.

According to research an electric car costs $12,000 more to manufacture in the small- to midsize-car segment. Currently most OEMs outside of Tesla lose money on electric car sales, which is clearly unsustainable. Hyundai charging stations provide the vehicle with an inexpensive way to recharge reducing the running costs of both the Hyundai Ioniq and Hyundai Kona

• Air pollution: ICE cars products harmful local air pollution which in many large cities leads to smog and harmful PMI levels. Electric vehicle can potentially be green when they utilise clean energy but this is dependent on the source of electricity. They don’t make sense when using coal because you are shifting the problem. Al be it less so.

Solutions such as solar based electric car charging and using electric car tariffs from major energy generators allows the utilisation of clean energy. This again provides an advantage for electric cars.

• Refuelling: Currently ICE cars have an advantage of convenience via a network of major petrol stations. This infrastructure is still being constructed for electric cars. However we note that you can charge your car at home which is more convenient than having to stop for petrol.

Currently it’s easier to own a traditional petrol car and so this area is a current weakness. However, evse.com.au is providing complete offerings from a basic home charging station to roadside fast charging solution. We believe this segment of the electric car industry will grow quickly to match the advancements of technology. If you purchase a Hyundai Kona and use a Hyundai charging station everyday then it’s potentially easier to operate an electric car. Research shows 95% of all electric car charging is conducted at home or work.

• Range: Petrol fuelled vehicles have a range of 400 – 600km while modern electric cars have a range of 400-600km. We note the next generation Tesla will be over 1000km in range. Amazing to say but we believe at EVSE that this will continue to expand with improvements in battery density, weight reduction and lower costs.

Based on the information above we can see that the costs of owning an electric car over traditional car is higher from a purchase prospective but lower from an operation perspective. Modelling shows that after 7 years an electric car achieves price parity. Currently most vehicles are on the road for an average 8 years or 240,000km. However we note that the purchase price of electric cars is coming down very fast and economics of scale being achieved. We believe that electric is the future due to superior technology, lower operational costs and improved engine efficiency.

Sam Korkees is the directors of EVSE Australia, the nations leading supplier of electric vehicle charging stations, charging cables and all EV accessories. To know more about Tesla chargers and installation visit www.evse.com.au