Electric Cars vs Gas: Which Will Cost You More Over 5 Years?

The end of the federal EV tax credit has reset the financial equation for car buyers. While electric models often carry a higher sticker price, lower fuel and maintenance expenses can nearly erase that gap over five years. For most U.S. drivers in 2025, the total cost of ownership for an EV and a comparable gas car now sits within a few hundred dollars. The better deal depends on how, and where, you drive.

• Five-Year Costs Nearly Match: A $56K EV and a $48K gas car each total about $57,700 to own over five years, assuming average driving (12,000 miles/year) and a DOE Vehicle Cost Calculator baseline.
• Fuel Savings Add Up: With gas at $3.50/gal and electricity at $0.14/kWh, EV owners save roughly $4,600 in fuel over five years.
• Maintenance Advantage: EVs save about $2,100 on upkeep thanks to fewer moving parts and regenerative braking.
• Incentives Still Matter: State and utility rebates, $2,000 to $5,000 in places like CA, CO, NY, and NJ, can shift the math decisively toward electric.
• When Gas Still Wins: Drivers logging under 6,000 miles/year, paying over $0.25/kWh for power, or lacking home charging often find gas vehicles cheaper overall.

The sticker price of a car often overshadows what truly matters, the total cost of ownership. With the federal EV tax credit no longer available, many buyers now find themselves re-evaluating the financial equation. The showroom comparison is simple: a sleek electric sedan priced around $56,000 versus a nearly identical gas-powered model at $48,000. On the surface, the gas vehicle appears to win. But when you factor in fuel, maintenance, insurance, and local incentives, the financial picture changes dramatically.

Purchase Price: The Initial Gap

At first glance, the $8,000 price gap between the two cars makes the gas-powered vehicle appear more affordable, giving it a clear advantage at the point of sale. The electric sedan costs about $56,000 compared to $48,000 for its gas counterpart, an upfront difference of $8,000 in favor of the latter.

However, that advantage quickly fades once ownership costs come into play. Over time, expenses like fuel, maintenance, and upkeep reveal a more balanced picture, often tilting in favor of electric vehicles, which tend to perform better in long-term cost efficiency.

Fuel Costs: Where Electric Begins to Pull Ahead

According to the U.S. Energy Information Administration (EIA), the national average gas price as of October 2025 hovers around $3.50 per gallon, while average residential electricity costs are $0.14 per kWh.

For a typical American driving 12,000 miles per year, here’s how the numbers stack up:

• Gas vehicle: 30 miles per gallon → 400 gallons per year → $1,400 annually

• Electric vehicle: 3.5 miles per kWh → 3,429 kWh per year → $480 annually

Over five years, the gas car consumes about $7,000 in fuel, while the EV uses roughly $2,400 in electricity, yielding a $4,600 savings in favor of electric. This alone offsets more than half of the original price gap.

If gas prices rise above $4.50, as seen in California, the five-year fuel cost for the gas vehicle can exceed $9,000, further tilting the economics toward electric.

Maintenance: The Silent Cost Advantage

Maintenance is where EVs establish their strongest lead. Traditional vehicles rely on oil changes, spark plugs, exhaust systems, and complex transmissions, all of which are absent in EVs.

Based on U.S. Department of Energy data and industry averages:

Gas Car Maintenance (5 years/60,000 miles):

• Oil changes (12 services): $600

• Transmission service: $300

• Air filters, spark plugs, exhaust repairs, belts, hoses: $1,550

• Brake pads and fluids: $200

• Total: ~$2,650

Electric Car Maintenance (5 years/60,000 miles):

• Tire rotations and inspections: $200

• Cabin filter and wiper fluid: $200

• Brake fluid: $150

• Total: ~$550

EVs have 75–80% fewer moving parts, and regenerative braking extends brake pad life by up to three times, leading to a $2,100 savings over five years.

Insurance and Incentives: Balancing Factors

Electric vehicles often come with slightly higher insurance premiums, typically $100 to $200 more per year, mainly because of the elevated repair costs associated with batteries and specialized body panels. Over a five-year ownership period, that translates to roughly $750 in additional insurance expenses. However, this higher cost is often offset by various state and utility incentives designed to encourage EV adoption.

Even though the federal tax credit has expired, several states still offer meaningful rebates and tax credits: California’s CVRP provides up to $2,000, Colorado offers up to $5,000, New York’s Drive Clean Rebate adds another $2,000, New Jersey’s Charge Up Program grants $4,000, and Massachusetts’ MOR-EV delivers up to $3,500. Beyond these, many local utility companies offer rebates for installing home chargers or discounted electricity rates during off-peak hours. For the purposes of this analysis, we’ll use a conservative estimate of a $2,000 state-level incentive to reflect a realistic average benefit.

Five-Year Cost Comparison (Without Federal Tax Credit)

Result: The total cost of ownership is nearly identical over five years, a remarkable shift from the days when EVs clearly outperformed on savings.

When Electric Vehicles Save More

The economics of electric vehicles can shift dramatically based on a few key factors. For instance, higher annual mileage significantly improves the financial case for an EV, driving 18,000 miles per year can boost five-year fuel savings to nearly $6,900, making the electric option about $2,200 cheaper overall. Regional fuel prices also play a major role; in areas such as California or Hawaii, where gas prices are consistently high, the cost advantage of EVs becomes even more pronounced.

State and utility incentives further tilt the balance, with some drivers combining rebates worth $5,000 to $7,000, substantially lowering the upfront purchase price. Ownership duration matters too: after seven years, gas vehicles often face expensive maintenance for components like transmissions, exhaust systems, and engines, while EV costs tend to remain stable. Finally, access to affordable electricity, especially through time-of-use rates or solar charging, can bring electricity costs down to around $0.10 per kilowatt-hour, cutting charging expenses by up to 40% and strengthening the long-term economic appeal of going electric.

When Gas Cars Still Come Out Ahead

There are still several scenarios where gas-powered vehicles maintain a cost advantage. For drivers who cover fewer than 6,000 miles per year, fuel savings are minimal, keeping gas cars cheaper overall. Similarly, those without access to home charging often rely on public DC fast chargers, where electricity costs can double or even triple, erasing much of the EV savings benefit. High electricity rates, particularly in states where prices exceed $0.25 per kilowatt-hour, also diminish the economic case for EVs, as charging costs begin to rival the price of gasoline.

In addition, extreme climates can affect performance; cold weather reduces battery efficiency by up to 40%, increasing both charging frequency and total energy costs. Finally, in regions without state or utility incentives, the initial price gap between EVs and gas vehicles can remain significant, making it harder for electric models to achieve overall cost parity.

The Bottom Line: The New Math of Ownership