Many experts predict that by 2026, Electric Vehicles (EVs) will cost the same upfront as petrol cars. Research has been done for seven new EVs and their petrol counterparts to see how the UK is doing in the first year of the Zero Emissions Vehicle (ZEV) mandate. There are three ways to get these cars: buying outright, leasing, and personal contract purchase (PCP), making up 20 different scenarios.

What We Found

  1. Smaller Cost Difference: EVs were only 12% more expensive upfront than petrol cars, not 50% as often claimed.
  2. Price Parity in Some Cases: In 6 out of 20 scenarios (30%), the cost of EVs matched or paid back within a year.
  3. Quick Payback: In another 5 scenarios (25%), the payback period was 2.5 years or less.
  4. Long-Term Savings: Drivers with average mileage could save up to £7,000 over four years by choosing an EV. Even with lower mileage, the minimum saving is £3,000 over four years, whether they lease or buy outright or through PCP. Higher mileage means more savings.

Recommendations to Keep Costs Down

  1. Continue the ZEV Mandate: This policy has been crucial in making EVs more affordable. It should continue.
  2. Better Communication: Clearly explain the cost savings of EVs and dispel myths so consumers can make informed decisions.
  3. Reduce Public Charging Tax: Cutting taxes on public charging will make it cheaper to run an EV.
  4. Support for Home Chargers: Investing in home chargers benefits both new and second-hand EV buyers and is more effective for low to middle-income earners than VAT cuts on new EVs.

Conclusion

The UK is making good progress towards making EVs as affordable as petrol cars. With continued support and clear communication of benefits, more people can switch to cleaner, cheaper EVs. Investing in home chargers is particularly beneficial, offering significant savings and convenience to a wide range of drivers.

By focusing on these areas, the UK can ensure that EVs become a cost-effective choice for more people, helping to drive the transition to zero-emission vehicles.

Source: https://www.bvrla.co.uk/resource/is-the-ev-versus-ice-price-gap-shrinking.html