A growing body of evidence suggests that electric vehicles (EVs) are already far closer to cost parity with petrol and diesel models than many reports would have you believe – but confusion around list prices risks holding back the shift to cleaner, more affordable transport according to car industry experts.
The problem is the use of headline recommended retail price (RRP) figures to compare petrol and electric cars. RRP ignores discounting – something that has long been part of the petrol and diesel market – and overlooks the fact that EVs tend to come far better equipped than their combustion-engine counterparts.
Where petrol cars are still often offered in stripped-back “base trims” designed to hit a marketing price point, EVs are usually richer in specification from the start. That means features such as connectivity, advanced driver assistance, performance upgrades and over-the-air software updates are standard on many EVs, whereas they remain expensive extras, or simply unavailable, on ICE cars.
Tanya Sinclair, CEO of Electric Vehicles UK, told us: “Across the automotive industry, we have a responsibility to communicate entirely and clearly about products and services. Comparing an entry-level ICE car with an EV that includes thousands of pounds worth of advanced tech does not tell drivers the whole story about the vehicles they are comparing. It’s a distortion that does consumers no favours.”
“EVs are the cutting edge of advanced technology and extremely good value for money in terms of space, performance and features. We should all be setting out their pound for pound merits at every possible opportunity.”
When you look model for model, a very different picture emerges. Renault’s Austral versus the all-electric Scenic, Volkswagen Tiguan against the ID.4, Golf against the ID.3, Nissan Qashqai against the Ariya or Kia Sportage versus the EV5 – each comparison shows that EVs typically deliver more space, performance and features, while lifetime running costs come in similar or even lower.
Battery costs, once the single biggest obstacle to parity, are tumbling. In parts of China, packs are already being produced for well under $100 per kilowatt hour, with global forecasts pointing towards around $60/kWh as early as 2026. At the same time, ICE technology is becoming more expensive thanks to increasingly strict emissions regulations.
That means in many segments, parity is not a distant promise – it’s already here.
Dr Andy Palmer, Founder & CEO of Palmer Energy Technology Ltd, was one of the first to see the potential. “In 2008, when we developed the Nissan LEAF, price parity with ICE was only a dream,” he said. “Batteries then cost $1,000/kWh. Today, at around $60/kWh, parity isn’t a hope – it’s reality. Add the lower running costs, and the economic case for EVs is now undeniable.”
Pat Hoy, founder of Insider Car Deals, which supplies data for The Independent EV Price Index, commented, “RRP is meaningless, no one actually pays it. Our transaction price data shows the real story: the median discount on petrol and diesel cars is already over 10 per cent (£4,134), and on EVs it’s nearly 12 per cent (£5,840).
“On PCP finance, the monthly gap between ICE models and EVs has narrowed to just £32, and when you look at total cost of a PCP - including the balloon payment - ICE models still end up around 5 per cent (£2,391) above RRP, while EVs come in almost 5 per cent (£2,960) below.”
With running costs that can be up to half those of petrol equivalents, plus the benefits of performance, refinement and technology, the message from industry experts is clear: EVs are not the expensive outliers that list prices make them appear. As Sinclair puts it, pound for pound they are already some of the best-value cars you can buy.
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