Hidden Costs of Owning an Electric Car

First Republic Bank
July 29, 2022

During the last few decades, electric cars have grown increasingly popular , and there are plenty of reasons why. For one, electricity is generally much cheaper than gas, with an average fuel savings for electric vehicle drivers being about 60%. Then, there are perks like reduced maintenance costs and a lower carbon footprint.

Still, owning an electric vehicle (EV) involves a host of costs worth considering. Before purchasing an electric vehicle, it’s important you make sure you’re aware of the true cost of owning an EV, including what you’ll owe upfront, operation and maintenance expenses and options to charge your battery at home or at a public station.

The upfront cost

First, consider your most significant and visible cost: the electric vehicle’s sale price.

Electric vehicles range quite widely in price, with base models created by lower-end manufacturers often starting between $27,400 and $35,000. EVs produced by higher-end manufacturers naturally carry higher price tags with many approaching or exceeding $100,000.

Fortunately, there are federal and state tax credits that may help you offset the initial cost of purchasing your electric vehicle if you qualify.

EV Tax Credit

As an incentive for EV owners, there’s a federal tax credit up to $7,500 for all-electric cars or plug-in hybrids (PHEVs), potentially offsetting the upfront costs associated with buying a new electric car.

Individual states may have additional incentives. For example, California offers an EV rebate program that gives car owners $1,500 for the purchase or lease of an eligible new all-electric or plug-in hybrid electric vehicle. New York offers a similar program with rebates up to $2,000.

This is not tax advice. We recommend you meet with a qualified financial and tax advisor to determine your eligibility for available tax incentives for electric vehicles.


However, there are more, often unseen, costs to consider when deciding whether an EV is right for you.

Operation and maintenance costs

One selling point for EVs is they tend to be less costly to maintain than gas-powered cars. In fact,  owners save an average of $4,600 over the life of an electric car compared to that of a gas vehicle. This is primarily because EV engines typically involve fewer moving parts than a traditional gas engine, so there’s less room for things to go wrong.

Charging stations

Another win for electric cars is the fact that they run on electricity, not gas. Instead of trips to the gas station, your vehicle relies on public charging stations or at-home charging units.

Public charging stations for electric vehicles are available throughout the country, but each visit will typically be more expensive than charging an EV at home. The ability to install an at-home charging station can save you the trip and marked up rates charged at a public station. Doing so affords you the convenience of recharging at home for no additional cost beyond additions to your electric bill and the potential need for minor home updates to accommodate the charging station. For example, you could  install solar panels to power your charger, though that would increase the upfront equipment and labor cost.

At-home charging stations can vary in cost, depending on your approach. There are three types of at-home charging stations, and higher-performing chargers cost more:


Level 1

Level 2

DC Level 3

Miles per Charging Hour




Cost of Parts

$300 to $600

$500 to $700

$20,000 to $50,000

Cost of Labor

$1,000 to $1,700

$1,200 to $2,000

Upwards of $50,000


DC Level 3 chargers deliver maximum performance, but they offer only limited vehicle compatibility. You’ll likely end up with a Level 1 or Level 2 charger, depending on your needs.

Regardless, once your charger is installed, you can begin charging your EV at home. This allows you to avoid marked-up public chargers and can save you money in the long run.

Battery replacement costs

Battery replacement can be a major price consideration when it comes to EV ownership. Batteries don’t last forever, though they may last up to 10 years, depending on variables like your driving habits.

The average EV battery replacement costs $5,500. With cheaper EV models, that’s a significant portion of the up-front price tag, so it’s important you’re prepared for this expense when it arrives.

Fortunately, every EV battery sold in the U.S. is under warranty for at least 8 years or 100,000 miles (whichever comes first). Many manufacturers go beyond this, offering lifetime warranties. This is particularly important if you are purchasing a used electric vehicle because, depending on the age and condition of the vehicle, the battery will likely need to be replaced earlier. Just be sure to read your warranty’s fine print ahead of time so you know which situations are covered.

EV costs vs. gas car costs

Perhaps the best way to understand the overall average cost differences between owning an EV and a gas car is to simply compare them side-by-side.



Gas Cars

Sale Price

$52,486 (May 2021)

$41,263 (May 2021)


$1.16 per egallon (March 2021)

 $2.85 per gallon (March 2021) (As of July 2022, gasoline prices average $4.63 per gallon)

Scheduled Maintenance

$0.061 per mile (June 2021)

$0.101 per mile (June 2021)


When looking at the cost of EVs, they often cost more upfront, but can deliver substantial savings in the long run.

Summary: The true cost of an electric car

Compared to traditional gas vehicles, EVs often deliver a variety of benefits that contribute significantly to their overall appeal. These benefits can include lower fuel costs, lower maintenance costs and lower emissions.

Still, it’s important to prepare for your EV purchase with a financing option that allows you to easily manage not only the vehicle’s upfront costs but other relevant expenditures, too — like the installation of an at-home charger or eventual battery replacement.

One possible solution? A personal line of credit.  Personal lines of credit allow you to access necessary funds when you need them without disrupting your usual cash flow..

Finance your electric car expenses with First Republic Bank

If you feel you’re prepared to join the growing EV community, consider financing your new vehicle with First Republic Bank’s Personal Line of Credit. With low, fixed rates, it’s a smart financing solution that can provide more flexibility than a traditional loan. For example, First Republic’s Personal Line of Credit allows you to cover the upfront costs of your electric car and the funds to cover unforeseen costs. You can enjoy additional benefits too, including the ability to secure the car’s title in your name only and the opportunity to make interest-only payments.

Personal Lines of Credit aren’t just for financing new vehicles, either. They’re also useful for minor home improvements — including at-home electric car charging stations — as well as student loan refinancing and family planning. Calculate your rate and see if a Personal Line of Credit is right for you.


Note: By refinancing student loans, you may permanently be giving up tax and repayment benefits, including forbearance, deferment and forgiveness. Please consider this as you make a decision to refinance student loans, and talk to a banker if you have any questions.


Currently, all payments for certain types of federal student loans are suspended through August 31, 2022, per an executive order by the President. Interest will not accrue during this time period."

Banking products and services are provided by First Republic Bank, Member FDIC and Equal Housing Lender.


1 Personal Line of Credit is an unsecured consumer loan that consists of a two-year, interest-only, revolving draw period followed by a fully amortizing repayment period of the remainder of the term. Draws are not permitted during the repayment period.

This product can only be used for personal, family or household purposes. It cannot be used for the following (among other prohibitions): to refinance or pay any First Republic loans or lines of credit, to purchase securities or investment products (including margin stock and cryptocurrency), for speculative purposes, for business or commercial uses, for a down payment on any property or for the direct payment of post-secondary educational expenses. This product cannot be used to pay off credit card debt at origination. Please note only debts that appear on your consumer credit report or student loans are eligible to be repaid at origination.

The terms of this product may differ from terms of your current loan(s) that are being paid off, including but not limited to student loans. By repaying such loans, you may permanently be giving up tax and repayment benefits, including forbearance, deferment and forgiveness, and you may not be able to reobtain such benefits if this loan is refinanced with another lender in the future.