Why Car Owners move to Electric Scooters: A cost comparison between car, electric car and electric scooter. 

Below, we compare the costs of owning a car to those of owning an electric scooter. The results are as you might expect conclusive: A scooter is significantly more cost effective. From the initial purchase cost to maintenance and fuel cars are a drain on the pocket.

While cars most definitely have a strong use case in New Zealand, more people are opting to forgo the costs of using their car everyday, especially for getting to and from work. The benefits of commuting by e-scooter are being enjoyed by an increasing range of folks and many inner city households are choosing to maintain only one vehicle by supplementing their travel with alternative transport methods.

Foreword

We are not suggesting that an e-scooter is a full alternative to a car for most people, but, owning a car is expensive, and, as researchers increasingly link air pollution with human diseases from stroke to parkinson’s disease, zero emissions transport is slowly gaining traction at all tiers of the transport sector, from electric unicycles to ships and aircraft.

Below we set out how you can save money on car ownership by supplementing your travels with an electric scooter where possible. 

CONTENT:

• The Costs of Owning a Car
• The Costs of Owning an Electric Car
• The Costs of Owning an Electric Scooter
• Could E-Scooters Replace Cars?
• Is Owning an E-Scooter Still Worth It In 2024?

The Costs of Owning a Car

Purchase Price

In 2023 simplenewzealand.com wrote that Kiwis spent an average of $45990 on a new car in 2022, and on trademe in 2023, the median car price was 12,000.

Taking into account these average prices of brand new and used cars, we can say that the median cost of getting a car in New Zealand should be around $28,995.00. 

Car Loan

As if cars are not expensive enough, the prices are made even steeper because of car loans. With interest rates varying from 9% - 25% and penalties on missed payments there is plenty risk associated with borrowing to finance a vehicle

Based on a car loan term of 4 years and an average interest rate of 15% let's consider a scenario where you are contemplating a loan for a car valued at $30,000.

Annually, you’d need to allocate approximately $10,019 to pay off the loan. This works out to $40076 across the four years, which is $10,076 more expensive than the car itself.

Petrol

In 2023 year, the average price of petrol was approximately $2.83 per litre. In 2024 this fell just 20c to $262 (figure.nz).

Based on an average distance travelled per year of 10000 km and an average fuel efficiency of 10 km per litre the average fuel cost per annum is $2663.00. Add to that the cost of tyres, servicing, and parts and maintenance.

And, as your car ages its fuel efficiency declines. The "Keeping it real" - fuel efficiency of New Zealand vehicles study indicated that overall fuel efficiency of New Zealand’s vehicle fleet is declining year on year. The study indicates that the ageing of New Zealand’s vehicle fleet and the mix of cars being imported is driving this rise despite decreasing emissions in new vehicles.

Insurance, Registration and Warrant of Fitness

Aside from upfront and fuel costs, a car owner also needs to consider the costs of registration and insurance. 

It’s important to know that aside from being compulsory, the costs of insurance may also increase every year. Based on the average cost of the average car, insurance we were quoted by Tower was $1,739 per year for a $35000 vehicle value.

Car registration is another expense associated with car ownership. New Zealand is relatively inexpensive at just over $107 per annum. An low cost warrant of fitness with no repairs is $60

Servicing

The cost of car servicing and maintenance is another thing you need to consider when you own a car. 

The average standard servicing is estimated to cost around $360. This does not include the cost of repairs. As these vary significantly over time and between cars the cost of necessary repairs has not been included here.

Parking Fees

Not every car owner considers parking fees when computing the costs of car ownership, but these accumulate and can amount to a substantial sum of money.

Parking in Auckland CBD costs start at $80 per week for a reserved carpark. Wilson carparks range up from $22 per day. Street parking ranges from $2 to $3 per hour with max limits of 2 - 3 hours. If you are paying for parking in a reserved space you are looking at $4160.00 per year.

SUMMARY

At a glance, here are the costs of car ownership in 2024:

Ouch.

Without a loan we calculate the initial purchase cost spread over 10 years less 10% as you may well onsell your car at this time. This comes to a cost of $2609.55 per year.

Let’s say you don’t have a car loan, don’t pay for parking, don’t drive on toll roads, you get just basic servicing on your car, and just meet all the basic legal obligations associated with car ownership, you’ll still be forking out $7409.49 per year.

And remember, this is for an average car—we’re not even looking at premium manufacturers such as BMW & Audi. 

The Costs of Owning an Electric Car

Purchase Price

Although electric cars provide a more environmentally friendly alternative to traditional fuel-powered vehicles, they are not much cheaper. 

While acknowledging the advantages of electric cars, it is important to consider that for individuals seeking to minimise transportation costs, this option may not be the most financially viable.

Entry level cost of a new electric car is around $30000.  Buyers who are looking to purchase a second hand electric vehicle would still have to shell out $20,000 for a car with an 80% battery

Car Loan

Similar to conventional cars, buyers have the option to obtain a loan for purchasing an electric car. Fortunately, as an incentive to encourage more Australians to go green, an increasing number of banks are now providing special deals on low-emission vehicles.

As of writing, the average interest rate for a car loan electric cars stands at 12.95%. Let’s assume you get a 4 year loan for a brand new electric car valued at $35,000. In this scenario, you can anticipate paying $949 per month which translates to $45,552.00

Over the course of a year, the total repayments amount to about $11,388.00

Charging and Road user charges

With an electric car, you don’t have to worry about the fluctuating costs of petrol or diesel. The costs of charging an electric car are not as exorbitant as fuel costs, and most electric cars can cover pretty long ranges on a single charge.

Let’s utilise the aforementioned data regarding the average distance covered by an Australian, which is 15,000 kilometres per year. The average charging cost per kWh is now $0.33. Fully charging a 40 kWh battery, the average battery size of an electric car, would only cost $13.20. 

Considering that a fully-charged 40 kWh battery can cover an average range of 250 kilometres, we can conclude that the average running cost of an electric car is only $52.80 per 1000 kilometres. Add road user charges of $80 per 1000 multiplied by average of 10000 km per year the average driver will pay $1328.00 operating costs year. Still half the cost of a petrol vehicle.

Insurance

While electric cars have a lower running cost than traditional cars, the costs of insuring one can be a bit higher.

According to WhichCar.com.au, electric cars are around 20% more expensive to insure. This can be attributed to several factors, including the higher price tag of electric vehicles, the relatively higher cost of new EV parts, and the limited availability of EV technicians and service centres in the country.

Based on the insurance figures used for a similar value $35,000 Rav 4, the average insurance cost for an electric car could amount to approximately $1,912.90.

Registration

AS with conventional vehicles the registration is $107 per annum and Wof is $60

Servicing

Despite the high costs of EV parts, electric cars are actually a bit cheaper to maintain than traditional cars. Electric vehicles do not require annual servicing and maintenance of air filters and brakes are the main costs. As these might not be required annually these costs have not been included.

Parking Fees

As electric cars require the same parking spaces as traditional cars, it can be assumed that owners of electric cars would also need to allocate a similar amount for parking fees. Thus, the estimated annual parking costs for electric cars would still be approximately $4160.00

SUMMARY

At a glance, here are the costs of electric car ownership in 2024:

Without a loan or parking you are still looking at an annual cost of $3,407.90. Adding the initial purchase cost spread over 10 years less 10% as you may well onsell your car at this time your annualised cost is $6557.90.

Mode Shift

The Average Cost of Owning an Electric Scooter

Purchase Price

While there are several high-end electric scooters available on the market that can exceed the $3,000-$5,000 price range, for the purpose of this discussion, let's focus on regular-priced electric scooters.

From our current inventory, we determined the average price of an electric scooter to be around $1,800. If you’re planning on getting an entry level or a commuter e-scooter, the price can be even lower (the E-Twow Booster, for example, is selling for only $1,199). 4 years is an easily achieved lifespan for an $1800 electric scooter, even using it every day, so for the sake of easy comparison we will use this in our calculation of costs.

Charging

Let’s calculate the running costs of an electric scooter. The average kilowatt cost in NZ is $0.33 per kWh (Canstarblue 2024). Meanwhile, the battery capacity of an $1800 e-scooter in our inventory is 0.78 kWh, which means a full charge costs roughly $0.26.

The average range covered by this electric scooter is 34 km, so to cover 100 km, you need to charge the battery 3 times, which will only cost you approximately $0.80.

Realistically, you can’t expect to cover the same number of kilometres on your e-scooter as you will with your car. So, we compute the running costs of your e-scooter, based on shorter trips.

According to NZTA, one-sixth of household car trips in New Zealand are under 2km long and almost half are less than 6km long.  (Short distance car trips are particularly polluting as cold engines consume around 40% more fuel, produce more emissions and increase engine wear and tear.)

Based on an average commute distance of 6km each way and you commute on dry days, you might spend 200 days per year commuting, this adds up to a total annual commuting distance of 2400 kilometres.

Based on the figures provided, the annual running cost of an e-scooter should be around $19.20.

If you can cover 10,000 kilometres on your e-scooter for the entire year, you can set aside a mere $80 annually for your electricity bill.  

Insurance

Under current New Zealand laws, electric scooters are not legally required to be insured. And while there are multiple options available to cover your e-scooter, the costs vary. 

For these reasons, we have not included insurance costs in the calculation of e-scooter ownership expenses.

Registration

As of writing, electric scooters do not require registration. Therefore, registration costs have not been considered in this analysis. 

Servicing

Regular servicing is essential for maintaining the optimal performance and longevity of an electric scooter. While the costs of servicing may vary, in general, e-scooter servicing is not excessively expensive.

Based on our experience, setting aside around $200 per year for your e-scooter servicing budget should be reasonable. This would cover at least a couple of punctures and a set of brake pads.

Parking Fees

The annual cost of parking cars, whether traditional or electric, can be a significant expense. However, one advantage of owning an electric scooter is that you can avoid these parking fees altogether.

With an electric scooter, you have the convenience of folding it up and storing it in compact spaces such as under your desk, in a locker, or any other suitable storage area, which eliminates the need for expensive parking fees.

Accessories

For your safety and convenience, we also recommend including the cost of accessories when computing the costs of e-scooter ownership. Based on our current inventory, we suggest allocating the following amounts for accessories:

• Helmet - $120
• Light - $60
• Lock - $100
• Bag - $50
• Phone Holder - $40

If you plan to purchase all the recommended accessories in one go, you can expect to spend approximately $380.

Public Transportation

Realistically speaking, it may be challenging to rely solely on an electric scooter to cover long distances. However, you can still make use of your e-scooter for the first and last miles of your daily commute and then utilise public transportation for the longer stretches in between.

Similarly, there will be days when unfavourable weather conditions prevent you from using your electric scooter. 

Thus, we factored in the cost of public transportation to accurately compute the costs of e-scooter ownership. Auckland transport caps its charges at $50 per week so the maximum cost per annum is $2400 if you use public transport to supplement the e-scooter 5 days a week, 48 weeks a year. We are allowing the maximum cost in this metric to allow for the fact most people need to commute 5 days a week.

SUMMARY

At a glance, here are the costs of electric scooter ownership in 2024:

We estimate the average lifespan of a mid range e scooter is around 4 years before an owner will upgrade. We have therefore spread the purchase price over that period to calculate the annual cost of e-scooter ownership.

If you do not use public transport at all this cost drops to $469.20 per annum

In reality many people use their cars or public transport on days where it is too rainy to ride safely or comfortably so the annual cost would somewhere between $469.20 and $2988.20. Either way, the savings are clear.

Could E-Scooters Replace Cars?

The short answer is yes … and no. For some people e-scooters can and do replace a car and for others not.

Electric scooters are a practical and efficient way to travel from one point to another. They offer several distinct advantages and have a clear use case for short distance travel. If you live further away from your destination you are likely to want a larger e-scooter and the costs will therefore be higher. If you have minimal commuting needs, or want last mile transport to the bus , ferry or train, an electric scooter can be a suitable option for you.

Ultimately e-scooters are designed for individuals to use. They have limited carrying capacity compared to cars and aren’t suitable for transporting multiple passengers or bulky items.

So, there may be a balance to strike here? If you have a car you will probably keep it. 

If your commute is in rush hour traffic, is relatively short or if you just want to save some dough, consider purchasing a reliable e-scooter so you wouldn’t have to use your car all the time. With the cost of fuel so high they can pay for themselves in no time, even if you need to finance it.

On the other hand, if you are considering purchasing a car, opt for a cheaper car model or a second-hand unit. By choosing a more affordable car, you can allocate some of the savings towards purchasing an electric scooter.

Owning an E-Scooter in NZ?

The numbers speak for themselves: owning an e-scooter saves money

Compared to cars the savings are significant. Low charging costs, minimal maintenance expenses, and zero parking.

Owning your own e-scooter proves to be a good long-term financial decision, as it gives you an opportunity to cut down on other transport costs.

As electric scooters become more common we can expect to see positive effects on the environment and traffic congestion. E-scooters contribute to a sustainable and efficient transportation system that benefits the community as a whole.

We know we are preaching to the choir here but we encourage you to do your own research. Ask people who are riding a scooter. They will tell you they love it. The freedom, the mindfulness, the opportunity to unwind on the way home. Our customers love it and we think you will too.

Car vs. Electric Car vs. Electric Scooter: Costs During the First Year