People often think that driving an electric vehicle is more cost-effective than a gasoline vehicle, but the latest driving cost report from the American Automobile Association (AAA) shows that comparing yearly expenses, gasoline vehicles are actually more cost-effective than pure electric vehicles.
According to the latest cost study by AAA, which compares vehicles in four categories – midsize sedans, compact SUVs, midsize SUVs, and pickups – by three power types – pure electric, gasoline, and hybrid, it was found that the annual usage cost of gasoline vehicles is actually lower than that of pure electric vehicles, and is similar to the most cost-effective hybrid vehicles.
The study indicates that for driving 15,000 miles per year, in the midsize sedan category, the annual costs for electric, gasoline, and hybrid vehicles are $13,692, $9,956, and $9,479 respectively, with per-mile costs of $0.913, $0.664, and $0.632 respectively. In other words, for driving 15,000 miles, gasoline vehicles save $3,736 compared to electric vehicles, spending only $477 more than hybrid vehicles.
For driving 15,000 miles annually in midsize SUVs, the costs are $12,710, $12,584, and $12,855 for electric, gasoline, and hybrid vehicles respectively, with per-mile costs of $0.847, $0.839, and $0.857.
Compact SUVs annual costs for electric, gasoline, and hybrid vehicles are $11,191, $10,279, and $10,340 respectively, with per-mile costs of $0.746, $0.685, and $0.689.
For pickup trucks, the annual driving costs for electric, gasoline, and hybrid vehicles are $16,758, $14,781, and $14,636 respectively, with per-mile costs of $1.117, $0.985, and $0.976.
The report compares six cost factors including fuel, maintenance, depreciation, insurance, registration and taxes, and financing costs when calculating annual driving costs. The report shows that the main factor affecting the cost difference between electric and gas vehicles this year is fuel prices. Additionally, although electric vehicles save about half of the fuel costs compared to gasoline vehicles, the ownership costs of electric vehicles are higher; ownership costs include depreciation, insurance, registration and taxes, financing costs, among others.
In 2025, the cost of driving gasoline vehicles per mile decreased by 13 cents (12.8%) from last year; regular gasoline prices are at $3.151 per gallon, lower than $3.539 in 2024. On the other hand, the cost of electricity per kilowatt-hour increased from 15.9 cents to 16.7 cents, leading to higher charging costs for electric vehicles. Despite the low maintenance costs of electric vehicles (ranking second lowest in all vehicle categories), the overall cost of driving gasoline vehicles is better than pure electric vehicles.
In California, where gasoline prices are significantly higher than the national average, the annual driving costs of gasoline vehicles may be higher than electric vehicles.
According to the cost calculation formula provided by AAA’s website, comparing a Tesla Model 3 Long Range sedan with a suggested retail price of $47,490 and a Lexus ES series hybrid sedan with a suggested retail price of $43,440 plus premium gasoline; if driving 10,000 miles per year, the total 5-year cost for Tesla is $58,946, while for Lexus it is $59,720; meaning the electric vehicle saves $720 (though the Lexus may offer a more comfortable driving experience).
For Lexus owners living in Florida, where gasoline prices are lower, if driving 10,000 miles per year, the 5-year cost is $54,668, saving $4,378 compared to Tesla. In Florida, opting for a Toyota Camry LE sedan that can use regular gasoline could save nearly $20,000 over 5 years when considering the price difference.
The cost advantage of gasoline vehicles is also reflected in the market. Despite electric vehicles often having maintenance cost advantages that gasoline vehicles can’t match, vehicle owners usually look at the overall costs and driving experience, making gasoline vehicles still the preferred choice for many.
In the Greater Los Angeles area, Alinda, a Chinese-American saleswoman for Lexus in Ontario, became the top salesperson at the dealership last month. She found that while new tariffs raised concerns about significant price increases for cars, the actual price of new cars only slightly increased, with almost no change in the price of used Lexus vehicles.
The Chinese community’s love for the Lexus brand has contributed greatly to Alinda’s excellent sales performance. Over half of her customers are Chinese. When she asked her customers why they chose Lexus, they responded that the car requires little to no repairs even after many years of use, and they can drive it for a long time as the “quality is really good.” Many of these customers are loyal followers of Lexus.
How to buy an affordable car? The American Automobile Association website suggests that joining their membership can provide access to member pricing from dealerships and special offers on participating vehicles, like receiving special event pricing via email, a 5-day/500-mile vehicle repurchase guarantee on new cars, and a 20% discount on post-purchase accessories, as well as offering a trade-in plan.
Furthermore, this year, second-hand car prices in the United States have slightly decreased. Although the latest Consumer Price Index shows an overall economic inflation rate of 2.9%, used car prices only rose about 1% compared to the same period last year. In August, the average price paid by American used car buyers was $25,393, lower than the revised $25,517 in July.