Electric vehicles in EU 33% cheaper to operate than gasoline cars

Electric vehicles (EVs) in the European Union were approximately 33 percent cheaper to operate in 2025 than comparable gasoline cars, according to a report by the International Council on Clean Transportation (ICCT). This cost advantage has expanded due to rising energy costs for internal combustion engines, which increased by 12 to 36 percent in early 2026, while electricity costs remained relatively stable.

In Germany, the largest European automotive market, the starting prices for battery electric vehicles (BEVs) in the three largest vehicle segments reached parity with gasoline models in 2025. This shift is supported by a 35 percent global decrease in battery costs between 2020 and 2025. In Germany specifically, the starting price of BEVs fell by 18 percent when accounting for inflation and vehicle characteristics, whereas gasoline car prices rose by 2 percent.

While the economic incentive for EVs is strong in Europe due to higher fuel taxes and structured energy costs, the gap is narrower in the United States. In North America, lower gasoline prices and different spatial densities affect the absolute savings realized by consumers compared to the European market.