Electric Vehicles vs. Gas Vehicles – Which one is cheaper to own?

With gas prices on the rise in Canada and around the world currently, owning an electric vehicle may seem like the smarter choice at this point. But is it really better in the long run? In this week’s blog post, we explore these two types of vehicles and weigh the benefits of each. Trust me, you might be surprised by the end result. 

For every benefit for one, its counterpart has an equal number to its name. We will compare a few key aspects in this blog post to help us to try to determine a final answer. If there really is one to this complicated question. 

Maintenance Costs

Both types of vehicles will need maintenance anyway you slice it. It all comes down to who takes the title for this category. Let’s start with gas powered vehicles first. Gas powered vehicles have more moving parts than electric vehicles, so obviously maintenance costs will be higher for this type. Gas powered vehicles require engine maintenance, and oil changes, among other things that contribute to the higher costs. 

According to an article posted in November of last year, the average amount of money spent on maintenance for a gas powered vehicle within the first three years was $228. For EV’s it was only $77. 

Electric cars take the title for this category by far. Electric vehicles will require slightly less maintenance simply because they doesn’t come equipped with an engine, so you will save money here. Studies have actually proven this and show that there is a 47% average cost savings between an internal combustion engine vehicle and an electric one – and the cost savings can actually be much higher than this. In terms of the battery, it is expected to last the lifespan of the car and therefore is not included as a maintenance cost.

Charging Stations and Gas Prices

Gas prices are becoming outrageous because of it’s tie to geopolitical events – the war in Ukraine. Countries are enforcing bans on other countries that are causing a chain reaction of events. As it stands currently, gas prices are over a dollar, some places even over two dollars, and making HISTORY. As of March 8, 2022 the national average for gas in the United States hit $4.17 – making it the highest price EVER for gas. 

Charging stations may appear far and few when thinking off the top of mind for them, but Canada is actually moving toward a “greener vehicle” experience across the country. In June 2021, the federal government laid out a new mandatory target for all new light-duty (GVWR less than or equal to 10,000 lbs) and passenger trucks sold within the country to be zero-emission by 2035. This is all in attempt to reduce pollution and fight against climate change. 

So what does this mean for car sales after this? Exactly what you think – the government can’t enforce a full ban on gas powered vehicles. They can however, make it more difficult for a brand new one to be purchased from a dealership or showroom. People are always looking to make money, so it is unlikely that the government would stop Canadians privately selling such vehicles. So once again, it’s another point for EVs. 

Depreciation

It is inevitable to own a vehicle and not have it depreciate – whether it is gas powered or electric vehicle. Interestingly enough, an electric vehicle actually depreciates faster than a gas powered one. To find out the reason why, we turn to those lovely incentives the government and car manufacturers offer you to purchase one. This includes tax breaks and no interest rates on electric cars for long periods of time. See incentives….the type that get people excited and encourage purchases before the offers expire. 

Did you know: In the United States, a tax incentive of $7,500 is offered for those who purchase new electric vehicles? 

The biggest hype of trading in the old EV for a new one is by far the new and improved technology. With limitations such as the range, people are excited to get the newest model on the lot in hopes of a better experience. 

Lets Talk Numbers

According to hotcars.com, electric vehicles actually depreciate at a surprising rate of 52% after three years. The conventional Sedan depreciates at only 39%. The conventional truck is even lower than this, depreciating at approximately 34% after three years. A reason for such a high rate of depreciation for electric vehicles is due to the higher demand for combustion engine vehicles. This large demand in turn results in the slower depreciation rate for conventional vehicles in comparison to electric vehicles. 

This is a trend that is expected to continue for the next few years simply because conventional cars remain the most popular mode of transportation. Popularity here, goes hand in hand with demand, and the demand is what has allowed these conventional cars to hold so much of their value, even better than electric cars can. It is expected that within 10 years, this trend might begin to change, shifting now to create the same scenario but with electric vehicles benefiting. 

In terms of dollars, on average an electric vehicle loses about $5,700 of its value per year, according to Forbes. Now, when thinking about Ford’s Mach E, one of the quickest electric SUV’s on the market, expect to see a drop of 25% on its value within the first year (according to Autoweek). Keep in mind, the first year usually brings the biggest drop in price, however, the price will continue to drop, up until about the third year when it begins to slow down a bit. 

Which is Cheaper to Own?

First it is important to note that this was just a general comparison between the two types of cars. If further research is done into specific models, the results may differ. 

Interestingly enough, in 2018 electric vehicles made 2% of all vehicle sales, still making these cars a rare sight wherever you may be. But just because people were buying them, does it really make it cheaper to own? Yes in a sense it does. With the recent hike in gas prices, I would personally say that electric vehicles would be the better option. They don’t require gas (so you will definitely be saving money here) and they aren’t that bad looking either (if I do say so myself). 

Also think about it, for those of you who work; how many people are driving an electric vehicle into the office, considering on purchasing one, or just talk about it generally? The popularity of them is increasing and this might just be the trend you want to hop on. 

In retrospect, EV’s took the most points with the aspects reviewed in this blog post. Despite falling short in the depreciation category, EV’s really are the future. The benefits are pretty sweet if you ask me and I mean you’re GETTING money to purchase them. I would say that’s a good deal, don’t you think? 

Final Thoughts

Although a lot of car companies nowadays are hopping on the trend of offering much-loved vehicles in both gas-powered and electric options (the Ford Mustang, for example), they leave the choice ultimately up to you. To many, this decision may seem very obvious – why mess with the original version? I agree with you, but to you, I ask this, what is better for the environment in the long run? Let that play on your conscious mind the next time you decide to check out the market for a new car. 

Author’s Note

Be on the look out for polls on our Instagram story! We always love to hear from you with ideas for future blog posts, so don’t be afraid to reach out and share your opinion. 

Since you made it this far, why not check out our blog post about electric cars? You are bound to learn something and trust me you will be surprised with the feature car within the post. 

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