Electric vehicles are cheaper to run than petrol or diesel cars, but their sticker prices are still too high for buyers to properly reap the benefits, according to a new study from the Royal Automobile Club of Queensland (RACQ).
Although electricity is cheaper than petrol or diesel on a per-kilometre basis, depreciation and the steep purchase price of pure-electric vehicles mean they're still pricier to own over five years.
According to the report, a Hyundai Kona Electric Highlander would cost owners $13,431 annually – assuming the car covers around 15,000km – compared to just $8501 for a front-wheel drive Kona Active, or $11,384 for a larger Tucson Active SUV.
Electric vehicles currently own a minuscule slice of the Australian car parc. At the end of June, electric and hybrid vehicles accounted for just 0.23 per cent of sales for 2019.
The Hyundai Ioniq Electric Elite is Australia's cheapest pure-electric vehicle at $44,990 before on-road costs, but it still was $1441 pricier per-year to run than the base Kona in the RACQ's calculations.
"Drivers need to be aware the Hyundai Ioniq has a higher purchase price than other small cars, so they need to weigh up the depreciation and interest costs with the fact they won’t be paying as much for fuel and will save on servicing before they opt for this vehicle," warned RACQ head of technical and safety policy, Steve Spalding
The study found the Kona Electric would cost $143.86 per week in depreciation, or $72.56 more than the base petrol, and 1.11 cents in tyre wear per kilometre compared to just 0.67 for the Active.
There are significant fuel cost savings on offer for electric buyers, however, with the Kona Electric costing just 3.49 cents per kilometre in electricity to run, compared to 9.79 cents for the petrol-powered Elite.
Owners could halve their 'fuel' costs again with the right power plan. The RACQ calculates its figures using Queensland electricity tariff 11 rates, a flat price of 26.62 cents per kWh that doesn't fluctuate with demand.
Charging off-peak could cost as little as 12 cents per kWh for homes with a smart meter, effectively halving the price of charging.
With purchase price a major hurdle to electric vehicle adoption, Tim Washington, CEO of JET Charge, says the RACQ study proves more should be done to help lower that price.
"If electric vehicles fare well in all other areas, and the only thing stopping people getting in one is cost, then we should be looking at how we bring that cost down for consumers," Washington told CarAdvice.
"There are many ways to do that," he elaborated. "We can look at the feebate scheme proposed by the New Zealand government, to state-based incentives such as stamp duty concessions, all the way through to higher-volume commitments by fleets, such as the various government fleets, which will drive up manufacturer volume, and reduce per-unit cost."
Even without government support, price parity between electric and internal-combustion vehicles could be on the horizon. Nissan predicts it could arrive as early as 2024.