Families often wonder which type of car truly costs less for a young driver in 2025. Electric cars can be cheaper to run, but petrol cars still suit students who drive short distances or can’t install a home charger. The choice often comes down to daily routines and how easily the car can be “topped up”, whether that’s fuel at a station or cheap overnight electricity at home.
Money also plays a huge part. Students rarely have long credit histories, so parents sometimes look at finance options like hp for bad credit to keep monthly payments manageable. Hire Purchase turns the price of a car — electric or petrol — into steady instalments, which helps families compare running costs and budgeting without pressure.
Running costs stretch beyond fuel or electricity. Insurance, tax, basic servicing and even parking all shape what a car really costs each month.
What counts as car running costs?
The main point is simple: running costs are the everyday expenses that keep a car on the road, and they often matter more than the price you pay upfront. Families usually think only about fuel, but several other items quietly add up through the year. Understanding them helps students avoid surprises once they start driving independently.
Fuel or electricity is the obvious one. Petrol and diesel prices change often, while electricity costs depend on the tariff you use at home or the charger you rely on in public. Insurance comes next. Young drivers usually pay more because risk is measured using age and experience, which insurers call a “risk profile”. It’s a straightforward way for companies to predict potential claims.
Tax is another regular cost. In the UK this is Vehicle Excise Duty, a yearly fee linked to vehicle type and emissions. Servicing and repairs also matter, covering basic checks, oil changes or brake replacements.
Fuel vs electricity: the real cost per mile
The key idea is straightforward: the cost per mile shows how much you spend each time the car moves, and it’s the fairest way to compare petrol and electric cars. Petrol cars burn fuel measured in litres. Electric cars use electricity measured in kilowatt-hours (kWh), which is simply a unit showing how much energy the battery uses. Lower cost per mile means cheaper everyday travel.
Here’s a simple way to think about it. A petrol car acts like a bottle that empties quickly when fuel prices rise. An electric car works more like a phone you charge at home. When home electricity is cheap, each mile becomes far more affordable. But when electricity is expensive — or you rely on rapid public chargers — the savings shrink fast.
A typical small petrol car might cost around 14–18p per mile depending on fuel price and driving style. An electric car charged at home off-peak can drop to 5–8p per mile. But public rapid charging can push that closer to 20p or more.
Beyond fuel: tax, zones, insurance and maintenance
The main point is that everyday car costs stretch far beyond fuel or electricity, and these extras can change the picture for students deciding between electric and petrol cars. Some costs rise with age and experience, while others depend on where you live or how your family uses the car.
Tax is the simplest piece. In Britain this is Vehicle Excise Duty, a yearly charge based on emissions and vehicle type. Electric cars currently sit in lower tax bands, but upcoming rule changes mean some will pay similar rates to petrol models. Clean air zones add another layer. Cities like London, Birmingham and Bristol charge older petrol cars for entering central areas, while many electric cars pass through at no cost, which helps regular commuters.
Insurance affects young drivers most. Premiums reflect risk, so students generally pay more regardless of engine type. Maintenance differs too. Petrol cars need oil changes and more routine servicing. Electric cars avoid many of these jobs but still require tyres, brakes and basic checks.
Big-picture money factors: depreciation, battery health and resale
The key point here is that long-term money factors often matter more than day-to-day fuel costs, especially for families helping a student buy their first car. Depreciation — the drop in value over time — is the biggest hidden cost. Petrol cars usually lose value steadily each year. Electric cars can fall faster because new models with better range arrive regularly, which pushes down older prices. A car that looks affordable today may be worth far less in three or four years.
Battery health plays a role too. Battery degradation simply means the battery holds slightly less charge as it ages. Most modern electric cars lose only a small amount each year, and manufacturers include long warranties to cover unexpected faults. But students buying used cars should still check battery condition because it influences range and resale value.
Resale value ties everything together. A well-maintained petrol car keeps a predictable price. An electric car’s future value depends on battery life, mileage and new technology. These factors shape the real cost of owning a car over time.
Which drivers really save with an EV?
The main point is that electric cars don’t suit everyone equally. Some drivers save a lot, while others may find costs closer to a petrol car. The pattern depends on habits, mileage and access to charging, which makes it easier for families to guide students toward the right choice.
High-mileage drivers gain the biggest savings. Someone covering long commutes each week benefits from lower electricity prices, especially when charging at home overnight. Meanwhile, short-distance drivers using a car mainly for local trips save less because they don’t cover enough miles to offset higher purchase prices.
Students living in cities with no driveway face a different picture. Public charging is convenient but often more expensive per mile, meaning savings shrink compared with home charging. Families with two cars sometimes switch one to electric for school runs or weekend errands because low daily mileage makes charging predictable.
A predictable routine, regular home charging and steady mileage are the strongest signs an electric car will cut daily costs.
How car finance and leasing change the maths
The main point is that finance and leasing can shift the balance between electric and petrol cars because they spread the cost over monthly payments. For many students and families, the monthly figure matters more than the full price, which means running-cost savings only help if they genuinely reduce the total monthly spend.
PCP and HP are the two common finance types. PCP (Personal Contract Purchase) keeps monthly payments lower because you only finance part of the car’s value. HP (Hire Purchase) spreads the whole cost, so payments are higher but ownership is clearer. Leasing works like renting: you pay a set monthly amount and return the car at the end. Electric cars often sit well with leasing because new technology arrives quickly, and families avoid long-term depreciation risk.
Savings from cheaper electricity can support monthly payments, but only if home charging is available. Otherwise public charging can cancel out the benefit. Insurance still plays a role, as electric cars sometimes cost more to insure due to specialist parts.
Final words
The key idea to leave with students and families is that choosing between electric and petrol cars in 2025 comes down to how the car will be used day to day. Costs shift depending on charging access, mileage and the need for predictable monthly payments. When those pieces line up, an electric car can feel easier to manage and cheaper to run. But when they don’t — especially if public charging is the only option — a small petrol car remains a steady and sensible choice.
Every driver’s situation is slightly different. A student commuting long distances, charging at home and keeping to a routine often sees clear benefits from an electric car. Meanwhile, someone driving short city journeys without a driveway may find the maths closer between both options.
