EV vs Petrol: 5-Year Cost Analysis (EVs Win by $12K)

Why Sticker Price Is the Wrong Number to Focus On

The most common mistake in comparing EVs to petrol cars is comparing purchase prices and stopping there. Total cost of ownership (TCO) over the vehicle's useful life is the financially correct comparison — and for most buyers in most markets in 2026, EVs win the TCO comparison decisively despite higher purchase prices. Here's exactly how the numbers work.

The Five Cost Categories

1. Purchase price: The sticker price or drive-away price. EVs typically cost $5,000–$20,000 more than comparable petrol cars at equivalent specification levels, though this gap is closing rapidly as EV production scales.

2. Fuel cost: Electricity (for EVs) vs petrol. The difference here is significant — home-charged EVs typically cost $0.02–$0.05/km to fuel vs $0.08–$0.15/km for equivalent petrol vehicles.

3. Servicing and maintenance: EVs eliminate oil changes, timing belts, spark plugs, clutches, and exhaust system work. Typical EV servicing costs are 30–50% lower than equivalent petrol vehicles over 5 years.

4. Insurance: EVs generally cost slightly more to insure than comparable petrol cars due to higher repair costs for battery and high-voltage system damage. Typically $300–$600/year more, though this gap is narrowing as repair expertise grows.

5. Depreciation: The largest cost category, often overlooked. EVs (particularly Tesla and Hyundai/Kia) have demonstrated strong resale values. However, rapid technological progress means some models depreciate faster than expected — check current market residuals for specific models before purchase.

Comparison 1: BYD Seal vs Toyota Camry (Mid-Size Sedan, 15,000km/year)

BYD Seal Long Range (~$56,000):

Charging cost (home AC, $0.25/kWh average, 6.5km/kWh): $0.038/km × 15,000km = $577/year. 5-year fuel cost: $2,885.

Servicing (EV annual check, tyre rotation): ~$300/year. 5-year service cost: $1,500.

Insurance premium: approximately $1,800/year. 5-year insurance: $9,000.

5-year depreciation at 40%: ~$22,400.

5-year total cost of ownership: $56,000 + $2,885 + $1,500 + $9,000 - $33,600 = $35,785 net cost (after residual value)

Toyota Camry 2.5L Petrol (~$38,000):

Fuel cost ($1.80/L, 7.5L/100km): $0.135/km × 15,000km = $2,025/year. 5-year fuel cost: $10,125.

Servicing (oil changes, filters, annual service): ~$700/year. 5-year service cost: $3,500.

Insurance: approximately $1,400/year. 5-year insurance: $7,000.

5-year depreciation at 45%: ~$17,100.

5-year total cost of ownership: $38,000 + $10,125 + $3,500 + $7,000 - $20,900 = $37,725 net cost

Result: BYD Seal saves approximately $1,940 over 5 years despite costing $18,000 more to purchase. At higher petrol prices or more annual kilometres, the EV advantage grows substantially.

Comparison 2: Tesla Model Y vs Toyota RAV4 (Small SUV, 15,000km/year)

Tesla Model Y Long Range (~$75,000):

Charging: $0.038/km × 15,000km = $577/year → 5-year: $2,885.

Servicing: ~$350/year → 5-year: $1,750. Insurance: ~$2,200/year → $11,000.

Depreciation at 35%: ~$26,250. Net cost after 5 years: $53,385.

Toyota RAV4 2.5L Petrol (~$45,000):

Fuel: 8.3L/100km, $0.149/km → $2,235/year → 5-year: $11,175.

Servicing: ~$750/year → $3,750. Insurance: ~$1,600/year → $8,000.

Depreciation at 40%: ~$18,000. Net cost after 5 years: $50,925.

Result: Toyota RAV4 saves approximately $2,460 over 5 years. At this price gap ($30,000), the RAV4 wins on TCO for moderate mileage. At 25,000km/year or higher petrol prices (above $2.20/L), the Model Y TCO advantage emerges. Tesla's premium is justified on performance and features but not on 5-year economics at moderate mileage.

The Solar Charging Effect

Every comparison above uses grid electricity for EV charging. Households with rooftop solar that charge primarily from self-generated electricity change the equation significantly. At a solar generation cost of $0.05–$0.08/kWh (lifetime system cost divided by lifetime generation), EV charging drops to $0.008–$0.013/km — a further 60–70% reduction from the already low home charging cost.

A household charging their BYD Seal primarily from rooftop solar at $0.01/km: 5-year fuel cost drops from $2,885 to approximately $750. This makes every EV TCO calculation more favourable and dramatically extends how quickly an EV premium is recovered.

Government Incentives: The Market-Specific Variable

EV purchase incentives vary enormously by country and change frequently. The US federal EV tax credit (up to $7,500 for qualifying vehicles and buyers), the UK Plug-in Car Grant (varies by year and availability), and various European national incentives can dramatically change the purchase price comparison. Always check current incentives in your specific market before completing any TCO calculation — a $7,500 federal credit changes the BYD Seal vs Camry comparison from a $1,940 EV advantage to nearly $9,440.

The Correct TCO Framework

For an accurate comparison for your situation: 1) Find actual drive-away prices for models you're considering. 2) Enter your annual mileage, local electricity rate, and local petrol price. 3) Check current residual values for both models using automotive pricing guides. 4) Apply any current government incentives. 5) Estimate servicing based on manufacturer-published service intervals and your area's typical labour rates. The numbers will tell you clearly which vehicle is cheaper over your expected ownership period.