EVs have more competitive TCO rate in ‘growing number of segments’

The average monthly total cost of ownership (TCO) for leasing a car varies hugely across Europe, from €815 (£682) a month in Greece to €1,252 (£1,048) a month in Switzerland.

The figures are from the Ayvens Car Cost Index 2025, which examines the TCO for cars, ranging from the sub-compact segment to larger premium car segments for fleets.

TCO costs are averaged over the first four years of ownership, assuming an annual mileage of 30,000km (18,600 miles), and based on Ayvens’ lease quotes from quotations made in Q4 2024 in 28 European countries. 

The Car Cost Index factors in the various costs involved in car ownership in each country, including depreciation, interest, repairs, maintenance, tyres, energy/fuel, tax (excluding VAT) and comprehensive insurance. 

It found that the TCO for leasing battery electric cars is typically cheaper than petrol and diesel models in western and northern European countries compared to countries in southern and eastern Europe. 

Only in the mid-sized premium segment is BEV cost competitive in all countries.

Greece, Sweden and Finland are the cheapest places for a battery electric car based on the TCO, with the costs below €820 (£686) a month in all three countries. 

The average TCO to lease a car (BEV, PHEV, petrol and diesel) in Europe is €1,090 (£913) a month. 

When compared with the TCO of ICE vehicles, BEVs now have a more competitive TCO rate in a growing number of segments in European countries. 

For example, compact segment BEVs are more affordable in western and northern European countries, except in Germany, and the mid-sized standard segment is the least affordable segment, with BEVs being cheaper in 11 countries. 

Meanwhile, mid-size premium segment BEVs are cost competitive in all European countries. 

The BMW i4, for example, has a lower TCO compared to the BMW 3 Series (petrol) in 21 European countries out of 27.

Matt Walters, head of consultancy services and customer value at Ayvens, said: “Ayvens 2025 Car Cost Index highlights the growing affordability of battery electric vehicles across Europe, making them an increasingly viable option for corporate fleets. 

“However, for UK-based and global fleet managers, understanding local taxation and leasing policies is crucial for future planning.  

“As one of Europe’s most mature fleet markets, the UK has seen rising EV adoption, particularly through salary sacrifice schemes. 

“With company car tax incentives favouring electric vehicles, businesses can achieve cost savings – such as reduced national insurance contributions – while advancing their sustainability goals. 

“Employees also benefit, gaining access to brand-new EVs at lower costs due to low benefit-in-kind tax rates, enhancing morale and retention.”  

He added: “At Ayvens, we support some of the UK’s largest employers, from healthcare to financial services, and have led salary sacrifice and corporate EV adoption for over a decade.

“Our focus is on navigating local taxation, policies, and regulations to provide tailored solutions that enable fleets to transition to net zero cost-effectively and sustainably.”  

Before the tightening of Clean Air For Europe (CAFE) standards in 2025 and the adoption of new budgetary rules in some markets favouring battery electric vehicles (BEVs) over internal combustion engine (ICE) vehicles, this year’s study reveals the complexity of TCO competitiveness for BEV as a lease option across segments and countries.  

Annie Pin, chief commercial officer at Ayvens, said: “Ayvens’ Car Cost Index was created to help our clients make informed decisions when choosing their fleet vehicles. 

“This report allows them to take into account the overall cost of their vehicles, compare options and evaluate additional trade-offs such as driver taxation and repairs, maintenance and tyres. 

“Today, electrification is complex and can be challenging for our fleet managers. It is our role, as a leading player in the leasing sector, to make sure that our clients have the right tools and advice to make smart decisions for their fleets.” 

The 28 countries included in the Car Cost Index are: Austria, Belgium, Bulgaria, Croatia, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, and the UK.  

‘Cost competitive’ is defined for the purpose of the Index as BEVs which are no more than 5% more expensive than the most comparable ICE vehicle. 

Read more from Walters on why salary sacrifice remains a cost-effective tool.