Ownership Cost of EVs and Regular Cars to be Equal by 2025

Ownership cost of EVs and regular cars to be on parity by 2025 according to Renault if the electric medium becomes more accessible and see increase in demand

Renault believes that the total ownership and running costs of a B-segment car will be similar by the end of this decade. Speaking to Autocar, a spokesman for the French automaker said that prices of electric vehicles and IC-engined cars won’t equalise in the next three years as opposed to a statement its EV boss, Gilles Normand, was reported to have said earlier.

The spokesperson cleared the air and said he was referring to the total ownership costs over a five year period and not the initial price itself during purchase. However, by 2025 the commonly denoted TCOE (total cost of ownership) for a C-segment EV will cohere with the same sized conventional cars running on combustion engine.

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In the UK, the TCOE is used in the fleet and leasing industry for calculating the combined costs involved in insurance, fuel efficiency, buying price, after-sales service, residual values, repair and maintenance. It is reported that the cost of manufacturing batteries will significantly go down when the volume and demand increase.

It will ultimately reduce owners the monthly leasing costs. Moreover, if the appeal of electric and hybrid vehicles increase, the IC engine equipped vehicles will get expensive due to the more stringent emission standards coming into effect in the future as well as the production costs involved. It will get only worse when the demand slumps.

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Renault did not give the split up costs in the total ownerships but the TCOE will favour the EVs it says. The TCOE for electric Zoe ranges between 57p and 86p per mile while for the regular Clio it is from 39p to 56p based on the variant levels over a period of three years and 30,000 miles, whichever comes first.

The higher the battery vehicles become accessible and affordable, the more popular it will get. The production costs involved in the electric driveline will decide how sooner the current medium of driving and the future converges in terms of pricing.
Source: AutocarUK