For much of the past decade, electric vehicles in Australia have been viewed as a strategic or environmental investment rather than a financial one.
That distinction is rapidly disappearing. Across both light and heavy vehicles, Total Cost of Ownership (TCO) modelling now shows EVs competing strongly – and increasingly winning – on pure economics, driven by falling vehicle prices, policy reform and better understanding of real-world operating costs.
Light vehicles: price parity is now visible
In the light vehicle market, purchase prices for electric Passenger Vehicles, SUVs and Utes have fallen sharply over the past three years. Since 2022, several high-volume EV models have seen list price reductions in the order of 20–40%, while in some cases, entry prices for Medium SUVs and Passenger EVs have dropped below $50,000 drive-away.
This has materially narrowed the upfront price gap with ICE equivalents, particularly in the Passenger and Medium SUV segments. For companies operating a fleet of vehicles, this makes the decision to go electric extremely compelling.
These trends are being reinforced by Australia’s National Vehicle Efficiency Standard (NVES). By attaching a financial cost to high-emitting vehicles and creating compliance pressure on Original Equipment Manufacturers (OEMs), the NVES is accelerating EV supply and price competition.
Medium SUVs and Utes – traditionally higher-emitting segments – are a particular focus, as substituting an EV in these categories delivers a larger compliance benefit per vehicle. The result is a growing number of EVs priced at, or close to, ICE parity before operating costs are even considered.
When TCO is assessed over a typical fleet holding period (that is, the years owned or kilometres driven depending on the vehicle type, usage, and industry), the advantage of transitioning to electric becomes clearer.
EVs avoid fuel costs that routinely exceed $2.00 per litre, while electricity for managed charging is often three to five times cheaper per kilometre. Maintenance and servicing costs are also materially lower, with fewer moving parts and reduced brake wear.
For vehicles travelling 15,000–20,000 km per year, these savings are sufficient to offset residual purchase price differences within the first few years of ownership.
The ATO’s Fringe Benefits Tax (FBT) exemption further tilts the equation. For eligible EVs below the luxury car tax threshold, the exemption can reduce the effective cost of a novated lease by $10,000–$20,000 or more over a typical term, depending on income and usage.
In TCO terms, this often pushes EVs decisively ahead of ICE vehicles for both employers and employees, particularly in high-utilisation fleet roles.
Heavy vehicles: on the road to viability
Heavy vehicles present a more nuanced picture, but one that is increasingly positive.
While battery electric trucks still represent less than 1% of new truck sales, uptake is set to increase, with 15+ brands now available in the market, compared to just three brands in 2023.
Last year we saw a 24% increase in sales of electric trucks and vans over 3.5t GVM, from 278 in 2024 to 344 in 2025. The sales increase is being driven by more and cheaper vehicle options, with prices falling roughly 50% across the past five years.
As new models continue to improve the functionality and reliability of heavy vehicles, the economics depend heavily on duty cycle, utilisation and charging strategy.
Mov3ment Consulting’s TCO analysis shows that several heavy vehicle segments are already approaching parity with diesel over a seven-year ownership period. These include last-mile urban delivery (4.5–8 t), waste and municipal vehicles, and certain regional delivery applications.
In these segments, high annual mileage – often 40,000–100,000 km per year – amplifies the benefit of lower energy and maintenance costs, which can outweigh higher upfront vehicle prices.
The analysis also highlights sensitivity to capital cost and utilisation. For example, a battery-electric truck priced at around $450,000, operating at 100,000 km per year, can deliver a net operating saving of approximately $1,700 per year compared to diesel.
Yet lower mileage or higher purchase prices will quickly erode the cost benefit. This underlines the importance of working with industry experts who can help design tailored solutions that realise actual operating cost savings, rather than broad generalisations about “truck electrification”.
A clear inflection point for fleets
Taken together, the data shows a clear inflection point, particularly for company fleets. For light vehicles, EVs are already the lowest-cost option for many fleets once whole-of-life costs and tax settings are considered. For heavy vehicles, the path to TCO breakeven is now well defined and increasingly achievable in high-utilisation, return-to-base applications.
To aid the transition, service providers like JET Charge are now making charging infrastructure and ongoing charger management bespoke, scalable and financially viable, reducing complexity and costs for fleet operators.
We’re working with some of Australia’s biggest corporate leaders to introduce electric fleets and operate at scale. Take IKEA, who – as of October – is completing 80% of its truck deliveries using EVs.
Or Woolworths, who is launching game-changing public charging initiatives while driving towards 100% electric home deliveries by 2030. These organisations are not pursuing electrification as a branding exercise, but because it increasingly makes commercial sense.
The question for Australian fleets is no longer whether EVs can be viable, but how quickly they can be deployed without disrupting operations. With vehicle prices falling, policy signals strengthening and TCO advantages now measurable in dollars rather than aspirations, electrification has moved from future strategy to present-day business case.
Kristian Handberg is head of future business at Jet Charge.
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