Electric car costs – the most important facts

Electric cars play a vital role in making road traffic more carbon neutral. However, many consumers have concerns about the price. At what point does owning an EV start to pay off and what expenses can you expect?

These costs apply to all vehicles

Anyone interested in an electric car will primarily look at the purchase price. But this is not the only aspect to take into consideration. Ultimately, there are a lot of costs associated with a car, regardless of whether it has a combustion engine or an electric battery: Car insurance, vehicle tax, fuel, operation, maintenance and repairs.

Only when all these costs are considered together, is it possible to determine, at what point owning an EV becomes worth it. Maybe in the end, the purchase price is not the most important aspect after all.

The cost of acquisition – more does not necessarily mean more

In general, the purchase price of an electric car is higher compared to a conventional vehicle with a combustion engine. This is partly because of the expensive battery which the vehicles require to reach certain ranges. For example, the engine power of an electric vehicle ranges from 40 to 100 kWh, with an average estimated price of CHF 120 to CHF 130 per kWh. The average range of an electric car is currently around 300 kilometers.

The fact that the raw materials used are in high demand and have to be imported also makes the electric car market somewhat dependent on suppliers and on corresponding price fluctuations.

Furthermore, the production costs for electric cars are often higher since the market is still relatively small and due to the investments that are necessary for the development of new technologies. Despite the purchase price, electric cars can be worth buying since the operating costs are significantly lower. In addition, when buying an electric car, you will benefit from tax incentives and, depending on the canton, environmental rebates.

Environmental rebates and tax incentives

Although Switzerland has not yet launched a national funding promotional program, the cantons have established some regulations:

• Some cantons charge a reduced vehicle tax for energy-efficient cars, and some have even abandoned the tax altogether. 
• In addition, the import tax for cars from abroad – presently still at 4 percent – will be completely abolished for electric cars. It is currently still being reviewed by the federal government but may be eliminated entirely. There is no guarantee, however, that the dealers will pass this saving on to customers.
• But drivers of electric cars do benefit from the fact that the gasoline tax, which is due every time the tank is filled, is eliminated.
• Some cantons provide environmental rebates for the purchase of an EV.

Lower maintenance and operating costs

In contrast to the higher purchase price, electric cars generally have lower costs concerning maintenance and operation compared to vehicles with combustion engines. This is partly because electric cars have fewer movable parts and are therefore less prone to wear and tear and breakdowns. Typical maintenance measures such as oil changes are not required. But, truth be told, repairs are more expensive on average due to the sensitive technology.

On average, operating costs for EVs are about 50 to 70 percent lower than for vehicles with combustion engines, provided that the electric car is charged at home. EVs generally consume between CHF 5 and CHF 6 for every 100 kilometers. The exact costs are, of course, based on various factors, such as current electricity prices, the specific model and driving style. The average combustion engine consumes seven to eight liters per 100 kilometers, which, depending on the price of gas, is significantly more expensive.

Charging costs – construction of infrastructure

The costs for constructing and operating charging stations vary considerably. There are basically three charging options: Regular household sockets, wallboxes and fast charging stations

Although a normal household socket is the simplest and cheapest way to charge an electric car, it takes an excessively long time since the ordinary household socket was not developed for this purpose. Therefore, you should have an installed charging station for your electric vehicle (EV) at home due to safety reasons. These wallboxes are faster, more efficient and fully charge your EV within a few hours. On the other hand, a fast-charging station can charge the EV to 80 percent in about 30 minutes. In Switzerland, over 11,000 public charging stations have been installed so far, and this number is expected to reach 20,000 by 2025.

Insurance – individual criteria

The price of the premium is based on different factors and personal requirements. Due to the comparably high purchase and repair costs, it is advisable to consider comprehensive accidental damage insurance in addition to the compulsory third-party liability insurance. Any supplementary protection for battery, parking damage, etc. may also be worthwhile. The easiest way to determine the expected costs is to use the premium calculator. 

Depreciation – the market is still settling down

When it comes to purchasing an electric car, depreciation must be considered. Electric cars actually tend to depreciate more than combustion cars. However, the next few years will show how the market situation will develop in this regard.

There are several reasons for the potentially higher depreciation of electric cars:  

• On the one hand, the technology is still relatively new. Updated models and technology therefore appear on the market in relatively short cycles, which can cause older electric cars to depreciate more quickly. 
• On the other hand, batteries are a decisive factor. Whenever the battery of an electric car reaches the end of its service life, it is relatively expensive to replace or repair it, which lowers the resale value of the vehicle.

Choosing an electric car with a good battery life and a high charging capacity can help minimize depreciation. Regular maintenance as well as care and proper use, especially of the battery, also reduce the depreciation.

Conclusion: Calculation of the total costs

To calculate the actual expenses of electric cars, all relevant costs must be included: The purchase price, operating costs, maintenance costs and the resale value at the end of the usage period.

The calculation of the total cost should also take into account subsidies, tax incentives and the potential savings from lower operating and maintenance costs.

A total cost analysis over the entire period of use can show that electric cars are cheaper in the long term compared to combustion engines. Although electric cars generally feature a higher purchase cost, the lower operating and maintenance costs, as well as possible subsidies, can mean that the actual total cost is lower than for vehicles with combustion engines.

This depends largely on the fact that the price of electricity remains relatively low compared to the price of gas, despite rising trends, and that there are continued government subsidies and incentives for electric car owners. This is the only way to compensate for the more expensive purchase price.

FAQs on electric car costs

How much money can I save by switching to an electric car?

The savings depend on different factors, such as the price of electricity, annual mileage, and type of electric car. Some estimates predict savings of several hundred to one thousand francs per year.

How long does the battery of an electric car last?

There are several aspects that determine the service life of a battery: The brand of car, the type of battery, usage and the ambient temperature. Manufacturers often provide guarantees of eight to ten years.