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Why New Electric Cars Are Cheaper to Buy Than Petrol Versions

Why New Electric Cars Are Cheaper to Buy Than Petrol Versions

Why New Electric Cars Are Cheaper to Buy Than Petrol Versions

By Echos News Editorial Team
Published: April 18, 2026

Introduction

Electric vehicles (EVs) are often perceived as expensive compared to petrol cars. While the list price of EVs is usually higher, new research shows that for more than four in five UK drivers, EVs are actually cheaper to buy when factoring in government grants, dealer discounts, and finance packages. This article explores why EVs can be the smarter financial choice.

The Myth of Expensive EVs

Consumers often assume that EVs are unaffordable due to their higher upfront costs. Batteries remain costly, and predictions that they would become cheaper by 2027 have not fully materialized. However, headline prices don’t tell the full story. When discounts and incentives are applied, EVs frequently undercut petrol equivalents.

Government Grants and Incentives

The UK’s Electric Car Grant (ECG), funded until 2029/30, reduces EV prices by between £1,500 and £3,750 depending on eligibility. Combined with the Zero Emission Vehicle (ZEV) mandate, which pressures manufacturers to sell more EVs, these incentives make electric cars more appealing and affordable.

Dealer Discounts and Finance Packages

Dealers are offering larger discounts on EVs than petrol cars to meet sales quotas. Additionally, PCP finance deals often feature lower APRs for EVs, sometimes even 0%. Since 85% of new cars in the UK are purchased via PCP, these finance terms significantly reduce monthly payments, making EVs cheaper to own.

Real-World Comparisons

Insider Car Deals compared ten EVs with their petrol or hybrid equivalents. Here are some highlights:

  • Dacia Spring EV vs Sandero Stepway: EV monthly PCP £157 vs petrol £207. Winner: Spring EV.
  • VW ID.3 vs VW Golf: EV monthly PCP £235 vs petrol £306. Winner: ID.3.
  • Ford Puma Gen-E vs Ford Puma: EV monthly PCP £273 vs petrol £298. Winner: Puma Gen-E.
  • Audi Q6 e-tron vs Audi Q5 Sportback: EV monthly PCP £450 vs petrol £631. Winner: Q6 e-tron.
  • BMW iX vs BMW X5: EV monthly PCP £660 vs petrol £750. Winner: BMW iX.

In seven out of ten comparisons, EVs were cheaper to buy and finance than petrol cars.

Fuel Savings: EV vs Petrol

Beyond purchase costs, EVs offer significant fuel savings. For example, a VW ID.3 charged at home on an off-peak tariff costs as little as £176 per year for 10,000 miles. In contrast, a VW Golf petrol equivalent costs around £1,445 annually. Even with public charging, EVs remain competitive.

Depreciation and PCP Protection

EVs traditionally depreciate faster than petrol cars. However, PCP finance agreements shield buyers from this risk, transferring depreciation costs to finance providers. This makes EV ownership more financially secure.

Consumer Attitudes

According to Electrifying.com, rising oil prices are pushing more drivers to consider EVs. Nearly three-quarters of non-EV owners surveyed said fuel costs are influencing their decision to switch. The monthly budget protection offered by EVs is becoming a major selling point.

Conclusion

While EVs may appear more expensive at first glance, the reality is that grants, discounts, and finance packages make them cheaper to buy than petrol cars in most cases. Combined with lower running costs, EVs are increasingly the smarter choice for drivers looking to save money and future-proof their mobility.

© 2026 Echos News. All rights reserved.

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