Is It Cheaper To Buy An EV In The UK Than A Petrol Car?

The 2020s have seen a virtuous cycle in the world of electric vehicles, as thanks to raw material suppliers, designers, manufacturers and dealers, EVs are more popular and more affordable than ever before.

A recent report by Autotrader noted that nearly a fifth of all used car enquiries for cars up to five years old are EVs, a figure similar to the 22 per cent of new car sales that the Society of Motor Manufacturers and Traders cites.

One of the biggest reasons for this is that EVs have historically been extremely cheap to run, with it being possible to charge an EV completely and drive for hundreds of miles for just a few pounds.

However, one of the biggest barriers to EV adoption has been the upfront cost of buying a car, but that might have finally changed, according to data from Autotrader cited by The Guardian.

Is an EV actually cheaper than an electric car? How long have they been cheaper? And how have EVs gone from a worthy luxury to achieving cost parity with much more established technologies?

 

Are EVs Cheaper Than Petrol Cars?

Whilst a very important headline, it is important to be clear about what this milestone means, and also what it does not.

According to Autotrader statistics, the average price of a new electric car listed on their platform is £42,620, which is £785 cheaper than the £43,405 for a new petrol car.

This is a gigantic milestone, as it marks the first time that EVs have been cheaper to buy than petrol cars, meaning that, for people looking for a new car, the biggest barrier to adoption has been upended.

Whilst there have been surges in popularity before and waves of increased sales, this marks a watershed moment where the prevailing wind for the car industry is pointing.

There are some caveats to this; Autotrader is mostly known as a used car sales platform, and because EVs, as a practical concept, are newer than some used cars that Autotrader sells, EVs are not cheaper across the board.

As well as this, the average price figure includes the Electric Car Grant, a discount of up to £3750 off a car which costs under £37,000. 

This has helped to bring the average price down, although several companies have offered their own discounts, and a wave of Chinese EVs has brought additional options for EV drivers.

However, what matters is less the headline price and more the fact that it makes the total cost of ownership even more affordable compared to a petrol or diesel car.

 

Have EVs Always Been Cheaper To Run?

In the past, the sales pitch for an EV was complex; it was expensive to buy, and you were reliant on an infrastructure that was still largely being built, but this would be offset by much lower running costs.

EVs had fewer moving parts that would regularly require replacing, charging was often significantly cheaper unless you relied on rapid or ultra-rapid chargers for the majority of your trips, and the lifespan of the battery turned out to be far longer than expected in typical use.

All of this made EVs much cheaper in terms of total cost of ownership, but that can be a difficult sell when the initial price of the EV can produce sticker shock.

The result was a somewhat mistaken perception that EVs were a luxury car that could only feasibly be used in certain areas due to the charging infrastructure.

This has changed significantly, and with the price of the car itself getting cheaper, it becomes a far more attractive option for motorists, which in turn helps boost the used EV market and helps bring even more motorists into the EV world. 

 

Why Have EVs Gotten Cheaper?

Whilst the fact that parity has statistically been achieved is amazing, what also matters is how this occurred.

Part of the reason is due to the work of suppliers, manufacturers and dealers, who have managed to supply EVs at increasing scale, which naturally helps to lower the cost per unit and bring greater value to customers.

As well as this, an aggressive discounting campaign to help the car industry reach ambitious sales targets, and the Electric Car Grant, the surge in petrol and diesel costs has forced the hand of many motorists who have become sick of volatile petrol prices.

Electricity, whilst tied in some cases to fossil fuels, is increasingly based around renewable sources of energy and nuclear power, both of which are largely unaffected by wholesale gas and crude oil prices.