- Compare the Market research has found that the cost to purchase an EV is still the biggest barrier to entry.
- Battery life and replacement costs, along with availability of local chargers and the time to charge the vehicle were also reasons people do not want to buy an electric vehicle.
- Over a quarter of respondents said that they are also worried about the cost of insurance as a major deterrent in committing to buy an EV.
Electric vehicles may be a constant topic around the kitchen table, however, recent research from car insurance comparison site Compare the Market found that there are still some major barriers for the everyday person to purchase an EV.
According to Compare the Market’s research, the biggest reason people aren’t buying an EV as their new car is the price point. Almost three in five people say that the purchase price is a barrier to entry into the EV market. In contrast, just 9% of people said that nothing deterred them from buying an EV.*
Other key considerations that dissuaded people from purchasing an EV were worrying about battery life and replacement costs, the availability of local chargers, the time it takes to charge, and the driving range.
| Reason why people are dissuaded from buying an EV | % of survey respondents who perceive this as a barrier to entry |
| Purchase price | 57.8% |
| Battery life and replacement costs | 46.0% |
| Availability of charging locations in my area | 39.1% |
| Time it takes to charge | 39.0% |
| Driving range | 38.0% |
| Price of charging | 32.3% |
| The cost to insure it | 26.5% |
| Worried about the future resale value | 25.7% |
| Safety concerns | 19.6% |
| Understanding of technology | 17.6% |
| Lack of options for different lifestyles (e.g. towing, off-road or extreme weather) | 14.8% |
| Difficulty of insuring it | 10.4% |
| Other | 4.6% |
Furthermore, over a quarter of people were also discouraged by the cost of insurance for new technology vehicles. These worries are not unfounded, with previous Compare the Market research showing that the average car insurance cost for EVs is still a bit higher than that of equal-calibre internal combustion engine (ICE) petrol or diesel vehicles.
Commenting on the research, Compare the Market’s Executive General Manager of General Insurance and car insurance expert, Adrian Taylor, said that for people who are afraid to purchase an EV due to financial reasons, there is research out there that backs EVs being cheaper to run than a petrol car over the course of a year.
“We’re all feeling the pinch in this cost-of-living crisis, so it’s no wonder that people are not considering buying EVs when the general entry-level price range for these vehicles is around $50,000, while for fuel-based or ICE vehicles, it can be as low as $30,000 or even lower if you’re looking for a small car,” Mr Taylor said.
“However, we’ve done calculations around the running cost of a similar calibre EV and petrol cars and found that it was cheaper to run the EV for a year despite the higher insurance costs.
“Some reasons we might be currently seeing higher insurance costs for these vehicles is because parts may be harder to source or repair, as well as the current lack of expertise to service these complex technological and electrical components. But with the advances that the automotive industry is taking to catch up to the need for specialist mechanics, we should see insurance prices drop in the near future.
“However, in the meantime, people should be going out and comparing their options. Whether that’s the cost of running a new EV against the cost of running their current car or looking for ways to cut down their car insurance costs, there may be some pockets of savings and reductions to be found.”
To reduce the cost burden on entry-level price points for many EVs, the federal and state governments are also offering some monetary incentives for people to purchase. This includes exemption from the fringe benefit tax for eligible low or zero-emission vehicles Australia-wide, up to $6,000 rebate on a new zero-emission vehicle in Queensland or up to $3,500 rebate in Western Australia, as well as other stamp-duty or registration exemptions across the country. Australians are encouraged to check with their state governments for a list of rebates they may be entitled to.
*Compare the Market surveyed 1,006 Australian adults aged 18 and over in June 2024
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For interviews and more information, please contact:
Noémi Hadnagy | m: 0433 377 252 | e: [email protected]
Compare the Market is a comparison service that takes the hard work out of shopping around. We make it Simples for Australians to quickly and easily compare and buy insurance, energy, and home loans products from a range of providers. Our easy-to-use comparison tool helps you look for a range of products that may suit your needs and benefit your back pocket.
