How Much Does an Electric Car Cost?

Electric cars are steadily growing in popularity, as countries and car manufacturers alike aim to shift away from petrol and diesel vehicles. But if Kiwis are to begin making the shift in large numbers, electric cars need to become more affordable. So how much does an electric car cost, and can we expect prices to go down anytime soon? Canstar takes a look.

Electric vehicles have long been heralded as the future of transport. Electric cars, buses, trams, and trucks are integral to a future without fossil fuels. Although, a future in which we’re all driving Renault Twizys probably isn’t what most people have in mind.

The Renault Twizy

However, in the past few years, the EV market has ramped up. And electric cars of all shapes and sizes are going mainstream. That includes the smaller electric models we’ve come to know, but also SUVs, utes, trucks and everything in between.

In fact, of the top 10 selling electric vehicles last year, seven were SUVs. There are even rumours of a new Toyota Ute EV, to rival New Zealand’s favourite car the Hilux, on the way.

But providing Kiwis with a host of electric SUVs and utes isn’t the only barrier to converting the masses. There’s also the price. It’s a well-known fact that electric cars can be expensive. But exactly how much does an electric car cost? And are government incentives and lower operating costs enough to outweigh the sticker price?

In this article we cover:

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How much does an electric car cost?

Currently, the cheapest electric car on the market is the MG ZS EV, at a starting price of $48,990. With the government’s Clean Car Discount (more details can be found below), this comes in at around $40,000. So it’s fair to say that electric cars don’t come cheap.

If $40,000 is already well beyond what you can afford for a new car, don’t panic. A brand new EV may not be for you, but there is a second-hand market to explore. With the right car, and the right deal, it can be great option. And if $40,000 sounds high (but not beyond the realm of possibility) then don’t tune out just yet, either. Electric cars offer plenty of other savings and benefits down the road that could make the added cost worth it.

Although, it’s also worth reiterating that the MG ZS EV is the cheapest EV in the market. It only goes up from there. According to Motor Trade Association Advocacy and Strategy Manager Greig Epps, the average cost of a new electric car is about $68,000. By comparison, Epps said consumers, “can get a really good new petrol car for under $30,000”.

To provide further insight into these costs we’ve run the numbers on the top three selling EVs and top three petrol vehicles in New Zealand for the full-year 2021.

Top three selling EVs

Car model  Approx Starting Price
Tesla Model 3 $65,000
MG ZS EV $49,000
Hyundai Kona EV $70,000

Top three selling cars

Car model Approx Starting Price
Mitsubishi Outlander $34,000
Toyota RAV4 $38,000
Mitsubishi ASX $28,000

As you can see above, the top three electric cars are around twice the price of the top three selling petrol cars. Which is a significant cost. Even when you factor in the Clean Car Discount. 

What second-hand options do I have?

The EV market is all about EV posterchild Tesla, which is by far the No.1 selling electric car in the country (and the world). But when it comes to the second-hand market, the former posterchild, the Nissan Leaf, is all the rage.

If you’re truly on a budget, Trade Me is awash with cheap, second-hand EVs under $10,000. These could be a great option for a second car, great for work commutes and weekend errands. But bear in mind that most of these models are from the early to mid-2010s and the battery capacity will have reduced. So they won’t achieve the full range that was originally advertised on them. Not to mention, these older models just don’t have the range or features of modern EVs.

If you can stretch your budget to $20,000 or even $30,000, then your options open up. With plenty of makes and models only a few years old.

It is, however, worth noting that second-hand vehicles are not eligible for the Clean Car Discount unless they are new to New Zealand. That is, they are a used import. So if you’re buying it from a private seller that has already had it registered in NZ, you won’t get the government rebate.

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What is the Clean Car Discount?

The Clean Car Discount is a government initiative introduced in July 2021. As electric and Hybrid vehicles are typically costlier than internal combustion engine (ICE) vehicles, the initiative was designed to encourage Kiwis to opt for carbon-friendly vehicles by making them more accessible.

Initially, it provided fixed cashback rebates for consumers that purchased electric (BEV) and hybrid (PHEV) vehicles. Those rebates were:

As of April 1st 2022, updates to the Clean Car Discount scheme have changed the way it’s implemented. Notably:

  • Fixed rebate amounts have moved to a sliding scale based on the emission levels of the vehicle
  • All low emission vehicles, including ICE vehicles, can qualify for a rebate
  • In addition to rebates for low emission vehicles, fees for high emission vehicles have been added

As you can see from the above graph, any vehicles below the zero band receive a rebate. The more environmentally friendly the vehicle, the larger the rebate. Some petrol/diesel vehicles may qualify, but any significant rebates will likely be on hybrid and electric vehicles. As a part of the changes, a feebate is now applied to high emission vehicles in the same way as the rebate. Any vehicle that falls above the zero band will incur a fee. The higher a vehicle’s emissions, the larger the fee.

How do I receive the discount?

To qualify for the discount your vehicle must:

  • Cost less than $80,000 including GST and on-road costs
  • Be new or new to New Zealand (used-import) registered for the first time in New Zealand from 1 April 2022.
  • Have a safety rating of 3-stars or more on the RightCar website at the time of registration

Following the purchase of an eligible vehicle you (the registered person) will need to apply for the rebate online (providing the sale agreement, plates number and your bank account). Waka Kotahi will then transfer the rebate to your account.

For more details on the Clean Car Discount, click here.

How much does a plug-in hybrid cost?

A plug-in hybrid (PHEV) is another great way to lower your fuel costs and your carbon footprint. These are typically cheaper than full battery electric vehicles (BEV) and may be a more feasible entry point into electric cars. It’s worth noting that the fully electric MG ZS EV is still cheaper than any PHEV in the country, though not by much. We weren’t kidding when we said its price point is unheard of in the EV market.

But on average, a PHEV is cheaper than an EV.

Some people also prefer a PHEV due to the assurance that comes with a petrol engine to fall back on. Although, this does impact its EV range, which is typically only 40km-60km on battery alone.

Looking at second-hand options, again you have plenty of plug-in hybrid options for a much lower price. And you don’t have to worry as much about the performance of older batteries, because you still have a petrol engine to fall back on.

→Related article: Should You Buy a Hybrid? The Best Hybrid Cars in New Zealand

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How much does it cost to charge an Electric car?

An electric car costs more upfront, but this isn’t where saving are made. Most people that are interested in electric cars are interested for one main reason: no more fuel.

Cutting out petrol isn’t just good for the planet, but with the price of 95 hitting $3 in parts of the country, and 91 not far behind, Kiwis are keener than ever to go green over gas.

The following table details the cost per 100km for last year’s top three EVs, and based on a national average electricity price of 31c per kWh. Keep in mind that electricity prices vary, so check your individual plan to find your cost per kWh:

Car model kWh per 100km Cost per 100km
Tesla Model 3 14.3kWh $4.43
MG ZS EV 18.6kWh $5.77
Hyundai Kona EV 14.3kWh $4.43

Keep in mind that if you are using a public charging station (the EV equivalent of a petrol station) and not your own home’s power supply, the costs may be significantly different. Vector currently offers some free charging sites, but your average fast-charging site can cost up to $10 per kWh.

How does this compare to petrol costs?

By way of comparison, fuel economy is measured as litres used per 100 km, with the following table detailing the cost per 100km for last year’s top three selling vehicles (based on a price of $3 per l).

Car model l per 100km Cost per 100km
Mitsubishi Outlander 7.2l $21.60
Toyota RAV4 7.1l $21.30
Mitsubishi ASX 7.6l $22.80

The cost per 100km difference between EVs and petrol vehicles is stark. Taking the EV average from the above ($4.88) and the petrol vehicle average ($21.90), it works out to a difference of $17.02 per 100 km.

Based on a travel distance of 14,000 km per year, the above averages work out to total yearly costs of $683.20 for EVs and $3,066 for petrol vehicles. Over the course of the year, this is a difference of $2,382.80. Even if you were to assume that every charge you did was at a public fast-charging network (and you were paying $10 per 100km), that’s still a little under half of the estimated petrol costs above. And realistically speaking, most your charging should be done at home, anyway.

Of course, these figures serve as an initial guide. Real-world conditions could see more or less petrol or kWh being used. But it highlights the fact that fueling a car will almost certainly cost more than charging one. If you take advantage of EV power plans you could save even more on charging costs.

Check out the best power plans for an EV here, at Canstar Blue.

How much to replace an electric car’s battery?

There have been plenty of horror stories around customers forking up tens of thousands for a new battery on their Nissan Leaf. And, some of the horror stories are true. Currently, if you have to replace your EVs battery, and it isn’t under warranty, you could spend anywhere from over $10,000 to over $20,000, depending on its size and make.

But before you panic.

If you’re buying a brand new electric car, battery replacements shouldn’t be a huge concern. Most come with a significant warranty (often eight years) that guarantee not only it won’t die, but it will retain a certain percentage of its capacity. So if after five years your 380km EV is only managing 100km, you may be in for a free replacement.

It’s also rare for an EV battery to just die. Usually, replacements are needed due to the range getting too small (as mentioned above). In saying that, a 2019 study by Geotab found EVs lose, on average, just 2.3% capacity annually.

Assuming this, after eight years, your battery would still be operating at 81.6%. On a Tesla Model 3 with a staggering 491km range, that’s still a range of about 400km after eight years.

Based on this, a replacement may not be needed for well over ten years from time of purchase. At which point, you can assume a new battery will be cheaper. The EV market is evolving rapidly and costs are continually falling. Some countries already have battery recycling schemes, which reduce costs by offering trade-ins for old batteries in return for refurbished ones.

Buying a second-hand electric car

If you buy an older, used electric car, battery replacement concerns are a little more warranted. If you pick up a 2012 Nissan Leaf for a few thousand dollars, that’s great. But the battery is already a decade old.

If we assume it’s lost 2.3% capacity each year, it’s already at 77% capacity. On a 2012 Nissan Leaf, that could mean you’d barely get 100km on a single charge.

The age of your EV will play a big role in determining how concerned you should be about battery costs. If your EV is new, it shouldn’t be an issue. Although, of course, we can’t actually guarantee that.

If your car is second-hand but just a few years old, it also shouldn’t be too big a worry. Especially if the battery is still under warranty. But if you buy an EV that is getting on in years, factoring in potential battery replacement costs could be a worthwhile idea. Particularly as older EVs had more limited ranges even when new.

Other ongoing costs

Some other costs that could influence your decision are:

  • EVs and PHEVs are exempt from road user charges until March 2024
  • Studies suggest that maintenance costs are, in the long run, cheaper on an EV. With fewer parts and less maintenance or repairs to be done
  • If work is needed, currently, labour costs for maintenance and repairs can be more expensive. But as EVs become more popular, you can expect this to change

Owning an electric car: the key benefits

  • Lower operating costs – electricity costs on charging an electric car are significantly cheaper than petrol prices
  • Environmentally friendly –  the total emissions per mile for battery-powered cars are lower than comparable cars with internal combustion engines. Especially in NZ where much of our energy comes from renewable sources
  • Clean car discount – EVs and plug-in hybrids qualify for a government rebate
  • They’re smooth and quiet – there’s no engine noise and with no gears to work through, an EV is able to apply full power as soon as you touch the accelerator
  • Exempt from road user charges – until March 2024
  • Added safety – the weighty battery pack gives your EV a lower centre of gravity, so it’s less likely to roll. The lack of petrol or diesel also reduces the likelihood of it catching fire in a crash
  • NZ’s climate is ideal for electric cars – extreme heat and cold can impact an electric car’s battery life. Thankfully, many parts of NZ has an ideal temperate climate

author andrew broadley

About the author of this page

This report was written by Canstar Content Producer, Andrew Broadley. Andrew is an experienced writer with a wide range of industry experience. Starting out, he cut his teeth working as a writer for print and online magazines, and he has worked in both journalism and editorial roles. His content has covered lifestyle and culture, marketing and, more recently, finance for Canstar.

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