Comparison of Ownership Costs: Electric Cars Vs Petrol Cars

Posted on: Dec 1, 2022 | 3 mins | Written by: HDFC ERGO Team

Comparison of Ownership Costs: Electric Cars Vs Petrol Cars

Car owners and drivers across the globe have majorly relied on fuels such as petrol and diesel for over a century. Since these fuels are limited resources, it was essential for car manufacturers to explore alternate options. Thus, electric vehicles are getting more traction per day. They not only solve the problem of reducing reliance on petrol and diesel but offer a host of other benefits. Do not forget to inquire about new car insurance with your dealer, before buying your next car. Unlike conventional cars, electric vehicles do not spew any harmful gases into the air, thereby making them the more environmentally friendly option. Since EVs are still in their nascent stages, there are a few government subsidies available, which can bring down the cost of buying an EV. And for the enthusiast in you, EVs are fun to drive as well. with instant access to torque, you can have a fair bit of fun with them.

How Do Electric Cars Work?

If you want to buy an EV, it is only natural that you would be curious about how the mechanism works and how it is different from conventional cars. For starters, EVs do not require conventional fuels for operating, rather they rely on electricity. The cars are equipped with inverter batteries which provide juice for the car to operate. The batteries power the electric motor(s), depending on the car, which in turn helps the car to move. The motors used in EVs are vastly different from the engines used in ICE cars. Since motors of EVs have lesser moving parts, they are more efficient and require less maintenance. For you to continue driving, you can charge the batteries either at home, at charging stations provided by the company or at public charging stations. But most importantly, do not forget to buy COMPREHENSIVE CAR INSURANCE for your EV. Since EVs have a higher sticker price, it is essential to get adequate coverage for the vehicle.

Difference Between Electric And Petrol Cars

Here is a comparison of electric cars and petrol cars, on various parameters. Since a lot of manufacturers are moving away from making diesel cars and petrol cars being the preferred option, the comparison is only between petrol and electric cars.

Price difference

The cost of buying an EV is definitely higher than buying a petrol car in India. One of the major reasons for the price difference is the usage of battery packs. The technology used on these batteries is different from conventional batteries and they are designed to last for a long period of time as well. As the demand for EVs increase, the cost of buying a car will come down in the future. For now, you will end up paying a premium of 25-30% on buying an electric car. Similarly, the premium for new car insurance will also be higher albeit with a higher sticker price.

Cost of running

You will spend anywhere between Rs. 8-10 per kilometre if you drive a petrol car. For an EV, you will spend between Rs. 1.2-1.4 per kilometre. This stark difference gets accentuated if you use the vehicle for a longer period of time. If you were to use your car for 10,000 kilometres every year for the next 6-8 years, you will end up spending approximately Rs. 1 lakh on an EV. In the same duration, the cost of running a petrol car will be between Rs. 4.8 lakhs to Rs. 5.5 lakhs. Thus, EVs are easier on your pockets in the long run.

Cost of maintenance

Electric cars have far fewer moving parts and engine parts in general as compared to petrol cars. This not only makes them less complicated to service but also reduces the cost of maintenance. Though EVs are a bit expensive to buy upfront, the expenses that owners incur later are far fewer as compared to petrol cars. The yearly maintenance of an EV can be as low as 1/3rd or 1/4th of the cost of a petrol car for the same period. Thus, making them way more affordable to maintain. Also, the fewer parts in EVs mean that the need for replacing them due to wear and tear also greatly reduces. However, the cost of any repairs to the body of the car would remain the same. This is where a comprehensive insurance plan can save the day for you. If you do not claim your comprehensive plans, you can avail of discounts in the form of NCB. Car insurance no claim bonus discount starts at 20% for the first year and goes up to 50% for five consecutive years. Thus, NCB can help you bring down the policy costs.

Performance

The structure and design of the cars translate to the performance that both have to offer. For petrol cars, the power gets to the wheels with the help of the engine, gears, and clutches. However, in electric cars, the motor delivers the power directly to the wheels. This results in much higher torque and instant access to them as well. Electric cars do not have as many parts to transfer the energy through, which makes them more efficient in power delivery as well. These make the performance of electric cars sprightlier than petrol cars.

Car life

In a bid to fight the ever-increasing pollution, the government has brought in the scrappage policy. The government advises users to scrap their cars at the end of 15 years, as the pollution levels on older cars can get quite dangerous. In the meanwhile, a lot of other parts would need replacement by the time the car reaches 15 years. These are mostly due to wear and tear. An electric car, on the other hand, would only need the batteries to be replaced after extensive usage. Most car manufacturers offer extended battery warranties for their cars for up to 6 or 8 years. Depending on your usage, you might need to replace them during this period or after that. And considering the current costs of the batteries at Rs. 15,000 to Rs. 20,000 per kWh, you will end up spending between Rs. 6 lakhs to Rs. 8 lakhs for a 40 kWh capacity. The prices of batteries are expected to reduce in the coming years.

Which Car Should You Buy?

Based on the above breakdowns, buying an electric car would be ideal if you are looking for something to drive around mostly in cities. As the maintenance costs are low, they are cheaper to run and you can charge the batteries easily at home. However, the replacement cost of the batteries remains a concern. Though the cost of buying a new EV is a bit on the higher side, there are a lot of subsidies, which bring down the effective price.

Conclusion

The breakdown of different expenses related to owning an EV and a petrol car should make it easier for you to decide. Irrespective of which car you choose, ensure that you go through the new CAR INSURANCE that your dealership is providing. If the new car insurance premium is too high or has unwanted add-ons, you can discuss it.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

Reasons Behind the Frequent Hikes in Petrol and Diesel Prices in India

Top reasons to choose electric cars besides rising petrol and diesel prices

Converting your petrol or diesel car into an electric vehicle

Hybrid and Electric Cars – 5 Things to Know Before Opting for One

Electric Vehicle Insurance: Why is it More Expensive?