Total Cost of Owning an EV vs Petrol Car: Which is more economical?

Today, the biggest question while buying a car in India is- will it be right to buy an electric vehicle or a petrol car? Often, people decide only by looking at the on-road price of the car. However, the real cost can be estimated only when you look at its Total Cost of owning an EV vs a Petrol Car. This includes aspects such as the initial price, fuel cost, battery life, insurance, maintenance, and resale value.

The cost of charging an EV is much less than petrol, on the other hand, the cost of replacing the battery can be heavy on the pocket. Similarly, even though the initial price of a petrol car may be low, the cost of fuel and servicing makes it expensive in the long run.

In this blog, we will do a detailed comparison of the ownership cost of EV and petrol cars so that it will be easier for you to understand which option is better for your needs and budget.

Initial Cost of Owning an EV

When we think of buying any vehicle, the first thing that comes to our mind is its initial price. This is the point where the biggest difference between an electric car (EV) and a petrol car is seen.

Initial Cost of EV

Today, the starting price of electric cars in India is higher than that of petrol cars. The biggest reason for this is the cost of the battery pack. EV batteries are made of lithium-ion technology, which is expensive and accounts for 30%–40% of the total vehicle cost. For example, an entry-level electric car starts at around ₹8–10 lakh, while a petrol car of the same segment is available for just ₹5–6 lakh.

Initial Cost of Petrol Car

The biggest advantage of petrol cars is that they are budget-friendly. Whether you buy a hatchback or a sedan, the starting price is lower than that of an EV. This is the reason why most first-time car buyers prefer petrol cars.

Role of Upfront Price in Total Cost of Owning an EV vs a Petrol Car

If you look at the upfront price alone, a petrol car is definitely cheaper than an EV. But in the case of an EV, government subsidies and tax benefits reduce the upfront cost a bit. Many states also offer discounts on road tax and registration fees, which reduces the price difference between an EV and a petrol car to some extent.

So, while evaluating the Total Cost of Owning an EV vs a Petrol Car, it is important to understand that even though the upfront price of an EV is higher, the savings on charging and maintenance can balance out this cost in the long run.

Fuel vs Charging Cost

Fuel and charging costs are one of the most important aspects to understand the Total Cost of Owning an EV vs a Petrol Car. This is the area where EVs give a tough fight to petrol cars.

EV Charging Cost

The cost of running an electric car is much less than that of a petrol car. On average, the cost of 1 unit of electricity (kWh) is between ₹7 and ₹10, and an EV can run for about 6–8 km per unit. That is, for ₹100 of electricity, you can easily cover a distance of about 60–70 km. If you cover the same distance in a petrol car, then the cost can reach ₹500–₹600.

Fuel Cost of a Petrol Car

The ever-rising price of petrol remains a big concern for car owners. On average, a petrol car gives a mileage of 15–18 km/litre and costs around ₹5–₹7 per km at current petrol prices (₹100+ per litre). In contrast, an EV costs just ₹1–₹1.5 per km.

Long-term comparison

1. If you drive around 1,000 km per month:
2. EV cost: ₹1,200–₹1,500 (charging)
3. Petrol car cost: ₹6,000–₹7,000 (fuel)

Thus, an EV can save you more than ₹5,000 per month. The annual savings go up to ₹60,000, which helps offset the higher initial cost of an EV in the long run.

To summarise, in Total Cost of Owning an EV vs Petrol Car, EV charging cost works out to be cheaper by 70–80% compared to petrol car fuel cost.

Maintenance cost: EV Vs Petrol Car

Maintenance plays a very important role in the lifetime cost (ownership cost) of any vehicle. When we compare the Total Cost of owning an EV vs a Petrol Car, this aspect clearly goes in favour of EVs.

Maintenance of EV

Electric cars have a much simpler design than petrol cars. They do not have complex mechanical parts like an engine, gearbox, clutch or exhaust system. The main parts of an EV are the battery, motor and controller.

1. No need to change engine oil
2. No need for repairs like the clutch plate or the spark plug
3. Repairs and servicing are less due to fewer moving parts

Due to this, the annual maintenance cost of an EV is reduced by 30–40% compared to a petrol car.

Maintenance of a petrol car

Petrol cars require periodic oil change, air/oil filter replacement, regular servicing of clutch plate, gearbox and engine. As the car gets older, the cost of repairs and spare parts increases.

Example Comparison

1. Suppose you are driving a mid-size car:
2. Annual cost in EV: around ₹7,000–₹10,000
3. Annual cost in a Petrol car: around ₹15,000–₹20,000

It is clear that in the Total Cost of Owning an EV vs a Petrol Car, the maintenance of an EV is much cheaper, making it an economical option in the long run.

Battery vs Engine Cost

This aspect is very important to understand the Total Cost of Owning an EV vs a Petrol Car. Be it an EV or a petrol car, the most expensive parts in both are those on which the performance and life of the vehicle depend—the battery in an EV and the engine in a petrol car.

EV battery cost

The battery pack of an EV accounts for 30–40% of the total cost of the car. The average life of lithium-ion batteries is 6–8 years or 1.5–2 lakh kilometres. After this, the performance of the battery starts to decline, and sometimes replacement is required.

Replacing a new EV battery can cost up to ₹3–₹5 lakh (depending on the model). However, many manufacturers also offer a 7–8 year warranty on the battery, which can avoid this cost in the initial years.

Petrol car engine cost

The engine of a petrol car lasts for a long time, but it needs to be maintained regularly. As the car gets older, the engine may need repair or overhaul.

1. Engine repairs cost ₹50,000–₹1.5 lakh.
2. The regular cost of engine oil, filters and spare parts adds up every year.

Comparison

1. EV battery replacement can be costly, but it doesn’t happen often.
2. Petrol car engine repairs are cheaper, but small maintenance costs keep adding up.

That is, in the Total Cost of Owning an EV vs Petrol Car, the battery can prove to be the biggest expense for EV owners, while petrol car owners have to bear the cost of engine servicing and fuel over a long period of time.

Insurance Cost

Insurance is also an important part of the ownership cost of the vehicle. When we compare the Total Cost of owning an EV vs a Petrol Car, the difference in insurance premiums is also clearly visible.

EV Insurance in India

Ev insurance in India can be slightly more expensive than conventional cars. This is because of the coverage of the battery and electric motor. In case of battery replacement or motor failure, the cost can go up to lakhs of rupees, so insurance companies keep their premiums high.

1. Many policies include add-ons like battery protection and roadside assistance.
2. EV insurance in India is now offered by many companies, such as Tata AIG, ICICI Lombard and HDFC ERGO.

Petrol Car Insurance

Insurance for a petrol car is comparatively cheaper, as it does not include the risk of high-cost components like the battery or electric motor.

Due to the lower premium, the annual cost can be 15–20% less than that of an EV.

Comparison

1. EV: Insurance is expensive, but advanced coverage (battery + motor protection).
2. Petrol Car: Insurance is cheaper, but only basic coverage.

That is, petrol cars are slightly more economical in terms of insurance cost, but EV owners get additional protection. So this difference is important to keep in mind while evaluating the Total Cost of Owning an EV vs a Petrol Car.

Resale Value: EV Vs Petrol Cars

To understand the total cost of any vehicle (Ownership Cost), its resale value, i.e. the price it will get in the future, is very important. When we talk about the Total Cost of Owning an EV vs a Petrol Car, there is a lot of difference between the two vehicles in this aspect.

Resale value of EV

The EV market is still new in India. People are becoming aware of electric vehicles, but the second-hand EV market is not fully developed yet.

1. The biggest challenge is the condition of the battery. Buyers want to ensure that the battery’s health and its range are good.
2. The older the battery of the EV, the lower the resale value of the vehicle.

However, in the coming time, with the increase in battery technology and government support, the resale value of EVs is likely to improve.

Resale value of a petrol car

The second-hand market of petrol cars is very old and strong in India.

1. Buyers are easily found.
2. The value of the vehicle is decided by looking at the condition of the engine and mileage.
3. 5–7-year-old petrol cars can also be sold at a good price.

Comparison

EV: Currently, low resale value due to new technology and battery concerns.

Petrol Car: Better resale value due to a stable market and reliable engine.

That is, currently, in comparison of Total Cost of Owning an EV vs a Petrol Car, the petrol car is ahead of the EV in terms of resale value.

Conclusion: Cost of owning EV in India

In today’s era, it is not enough to look at only the initial price while buying a car. We should also pay attention to aspects like fuel cost, maintenance, battery or engine cost, insurance and resale value. Only when you add all these factors does the real picture emerge.

The Total Cost of Owning an EV vs a Petrol Car makes it clear that even though the initial price and battery replacement cost of an EV may be higher, the savings in charging and maintenance make it economical in the long run. On the other hand, petrol cars do seem cheaper in the beginning, but fuel and regular servicing put a heavy burden on them.

If your goal is long-term savings and responsibility towards the environment, then an EV is the right choice for you. On the other hand, if you want to buy a car immediately on a low budget and give priority to resale value, then a petrol car can be a better option at the moment.

That is, the choice between an EV and a petrol car depends entirely on your needs, driving pattern and budget.