Resale value significantly affects true cost of ownership. EVs have historically depreciated faster than gas cars — partly due to rapid technology improvements and early consumer uncertainty about battery longevity.
⏱ Break-Even Point
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Explore EV financing options and find the best rates for your next vehicle.
Enter your annual miles to see estimated costs for real-world EV vs gas matchups, including depreciation.
What Is Total Cost of Ownership?
The sticker price is only part of the story. Total Cost of Ownership (TCO) includes everything you'll spend over the life of the vehicle — financing, fuel, insurance, maintenance, and depreciation loss when you sell.
EVs often cost more upfront but significantly less to fuel and maintain. The break-even point is when cumulative EV savings offset the higher purchase price.
Understanding EV Depreciation
EVs have historically depreciated faster than comparable gas vehicles. Several factors drive this:
- Rapid technology improvements make older EV models feel outdated faster
- Consumer uncertainty about battery longevity suppresses used EV demand
- Luxury EVs follow the same steep depreciation patterns as luxury ICE vehicles
However, depreciation curves are expected to normalize as EV ownership becomes more common and buyer confidence grows.
Federal EV Tax Credits: Ended September 30, 2025
The federal clean vehicle tax credits — up to $7,500 for new EVs (§30D) and $4,000 for used EVs (§25E) — ended for vehicles acquired after September 30, 2025.
You may still qualify if you entered a binding purchase contract with a deposit before October 1, 2025 and subsequently acquired the vehicle. Consult a tax professional to confirm your specific situation.
State, utility, and local incentives remain available in many areas. Use the "Incentives" field in the calculator above to enter any incentive amount you qualify for.
EV Maintenance Savings
EVs have far fewer moving parts than gas vehicles, which translates to real savings:
- No oil changes (~$100–$150/year savings)
- Regenerative braking extends brake life 2–3×
- No transmission fluid, spark plugs, or timing belts
- Average EV maintenance cost: $400–$700/yr vs $1,000–$1,500 for gas
Electricity vs. Gas: Cost Per Mile
At average US prices ($0.16/kWh, $3.50/gal), charging an EV typically costs 3–4× less per mile than fueling a gas car. A vehicle getting 30 MPG costs about $0.12/mile in fuel. A 100 MPGe EV costs about $0.05/mile — a 58% reduction.
Home charging rates can be even lower with off-peak electricity plans, often under $0.10/kWh overnight.
How Long Should You Keep Your EV?
Holding period dramatically affects the math. At 3 years, the EV's higher purchase price often hasn't been offset by fuel savings. By 7–10 years, the cumulative fuel and maintenance savings typically dominate — especially if depreciation has already been absorbed.
Use the 7-year and 10-year projection options in the calculator to see how the numbers change for longer ownership.
What Is Total Cost of Ownership (TCO)?
Total cost of ownership is the complete financial picture of owning a vehicle over time — not just the sticker price. TCO includes purchase price (or net after any incentives), financing interest, annual fuel or electricity cost, insurance, maintenance, and depreciation (the value you lose when you sell). Over 5 years, the difference between purchase price and TCO can be $20,000–$40,000 depending on the vehicle.
EVs often cost more to purchase but significantly less to fuel and maintain. The break-even point is the month when cumulative EV savings first exceed the higher upfront cost — after that point, the EV costs less per mile driven.
How the EV vs Gas Cost Calculation Works
This calculator builds a full TCO model for both vehicles using your inputs. For each year of the projection period, it computes cumulative fuel cost (electricity rate × kWh per mile, or gas price ÷ MPG), cumulative maintenance, loan interest paid, and running depreciation. The break-even month is identified as the first point where the EV's cumulative costs drop below the gas vehicle's — accounting for any incentive entered reducing the EV's effective purchase price.
Resale value loss is calculated as: purchase price × (1 − resale percentage), spread over the ownership period. This single factor often dominates the TCO calculation, especially for vehicles held fewer than 5 years.
EV vs Gas: Annual Cost Comparison
| Cost Category | Electric Vehicle (typical) | Gas Vehicle (typical) |
|---|---|---|
| Fuel / Electricity (12k miles/yr) | $600–$900 | $1,800–$2,400 |
| Annual Maintenance | $400–$700 | $1,000–$1,500 |
| Insurance | $1,400–$2,200 | $1,200–$1,800 |
| Depreciation (5-yr avg/yr) | $4,000–$7,000 | $3,000–$5,500 |
| Incentives (state/utility/local) | Varies — check your state DMV and utility | $0 |
At 12,000 miles/year with average US electricity and gas prices, EV fuel cost is typically 60–70% less per mile than gas. Maintenance savings average $600–$800/year. Higher upfront cost and faster depreciation offset these savings in the early years.
Federal EV Tax Credits: Ended September 30, 2025
The federal clean vehicle tax credits established by the Inflation Reduction Act — up to $7,500 for new EVs (IRC §30D) and $4,000 for qualifying used EVs (IRC §25E) — ended for vehicles acquired after September 30, 2025.
Who may still qualify: buyers who entered a binding written purchase contract and made a deposit before October 1, 2025 may be able to claim the credit for a vehicle subsequently acquired. Consult a tax professional to confirm eligibility for your specific situation.
State, utility, and local incentives remain available in many areas and can be significant. Search your state's clean vehicle incentive program or your electric utility's rebate portal. Enter any incentive amount you qualify for in the "Incentives or credits" field in the calculator.
When Does an EV Make Financial Sense?
An EV is likely the right financial choice when: you drive more than 12,000 miles per year (higher mileage shortens break-even), you have home charging access (public fast charging often costs 3–4× more per mile than home charging), you qualify for state or utility incentives that reduce the purchase price, and you plan to keep the vehicle 5+ years to absorb the upfront cost premium.
An EV may not yet make financial sense if: you drive under 8,000 miles/year, you rely primarily on DC fast chargers (which can cost $0.35–$0.60/kWh), or you plan to sell in 2–3 years before the savings compound. Use the 3-year projection in this calculator to see your specific scenario.
How This Calculator Works
Enter the purchase price of each vehicle, financing details, annual mileage, fuel and electricity rates, ownership costs, and expected resale value. The calculator computes true total cost of ownership including depreciation, finds your exact break-even point, and shows year-by-year cumulative savings across 3, 5, 7, or 10 years.
Frequently Asked Questions
Are EVs cheaper than gas cars over 5 years?
It depends on your driving habits and electricity rates. At average US prices, EVs typically break even with a comparable gas car in 3–6 years when including fuel and maintenance savings. After that point, the EV is generally cheaper to own — especially at higher annual mileages.
Are federal EV tax credits still available?
The federal clean vehicle tax credits — $7,500 for new EVs (§30D) and $4,000 for used EVs (§25E) — ended for vehicles acquired after September 30, 2025. Buyers who entered a binding purchase contract with a deposit before that date may still qualify. State, utility, and local incentives remain available in many areas — check your state's DMV or utility rebate portal.
How much cheaper is it to charge vs fill up with gas?
At average US prices ($0.16/kWh electricity, $3.50/gal gas), charging an EV costs roughly 3–4× less per mile than fueling a gas car. A 30 MPG gas car costs about $0.12/mile in fuel. A 100 MPGe EV costs about $0.05/mile — a 58% reduction in per-mile fuel cost.
Do EVs really require less maintenance?
Yes. EVs have no oil changes, transmission fluid, spark plugs, or timing belts. Regenerative braking extends brake life 2–3×. Average EV maintenance runs $400–$700/year, compared to $1,000–$1,500 for a comparable gas vehicle — a savings that compounds significantly over 5–10 years of ownership.
How fast do EVs depreciate?
EVs have historically depreciated faster than comparable gas cars, in part due to rapid technology improvements and early consumer uncertainty about battery longevity. Depreciation varies widely by brand and model — Tesla and some others hold value better than average. Depreciation rates are expected to normalize as EV adoption grows.
What is total cost of ownership?
Total cost of ownership (TCO) includes purchase price, financing interest, fuel or electricity costs, insurance, maintenance, and the value you lose at resale (depreciation). The sticker price alone significantly understates the real cost of a vehicle over 5–10 years of ownership.
Does home charging make EVs more economical?
Yes — significantly. Home charging rates can be as low as $0.08–$0.10/kWh on off-peak electricity plans, compared to $0.30–$0.50/kWh at public DC fast chargers. Drivers who charge primarily at home see the largest fuel cost savings and the shortest break-even timelines.
When does an EV break even with a gas car?
The break-even point depends on the purchase price gap between vehicles, annual mileage, fuel and electricity rates, and maintenance cost differences. Most comparisons show break-even between 3 and 7 years. Higher mileage drivers break even fastest — every extra mile reduces the per-mile cost of the higher upfront EV price.
Is now a good time to buy an EV?
Expanding charging infrastructure and a wider model selection make EV ownership more accessible than ever. Without the federal tax credits that ended in October 2025, the upfront cost premium is larger than before — evaluate your specific mileage, home charging access, and any state or utility incentives in your area before deciding.
How does MPGe compare to MPG?
MPGe (miles per gallon equivalent) measures EV efficiency by expressing how far the vehicle travels on the energy equivalent of one gallon of gasoline — defined as 33.7 kWh. A higher MPGe means lower electricity cost per mile. Most EVs rate between 90 and 150 MPGe, compared to 25–35 MPG for typical gas vehicles.