Lifecycle Cost: BEV vs. ICEV — Pickup Truck Edition

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My recent article on the lifecycle cost of BEVs vs ICEVs was well received, so I thought I’d write another one, this time looking at trucks now that many OEMs are producing them — or are about to. A lifecycle cost analysis captures the full financial impact of BEVs across the vehicle’s entire lifetime for all owners. The more common 5-year comparisons are great, but they do not capture the full value of the vehicle to society. Clearly, BEVs continue to provide benefits across their entire life with lower fuel costs, lower maintenance costs, and potentially longer life beyond the first 5 years of their life. A full life-cycle cost analysis captures this.

My expectation going into this analysis was that BEV truck savings would be even higher than for BEV cars since fuel is such a key savings area for BEVs and trucks use more fuel than cars. The more fuel an ICE vehicle uses, the more a similar BEV “should” save — at least in theory. Furthermore, these savings should only increase if the owner tows or carries heavy loads regularly, since fuel consumption goes up dramatically under these conditions whether you drive a BEV or an ICEV.

As I mentioned in my last article on the lifecycle costs of BEVs, in my work as a management consultant, I learned to write my own computer modeling programs, since off-the-shelf software for this kind of thing doesn’t exist. To ensure my analysis models are not complete BS, I try to control for all relevant variables, and I design the models so that these variables can be easily adjusted. Fortunately, I was able to find pretty good information on the relevant specifications for trucks and on how people use them — including how much they tow and haul.

Assumptions

Purchase Price — Purchase price varies by location and local incentives. I wanted to increase the accuracy for this analysis since truck pricing can vary a lot depending on features and specs. For this analysis, I selected trucks that were all reasonably equipped, and I used California dealer website configurators to arrive at pricing. I also include the federal tax incentive of $7,500 in these models if they are applicable. Clearly, pricing will vary based on location and individual tax situations, with some people able to buy for less and some paying more.

Longevity (160,000 miles) — This number may seem low to some people, as it did to me, but we need to keep in mind we are talking about an average. The global fleet average accounts for vehicles that are involved in accidents and/or those that simply do not achieve their full potential for whatever reason. Individually, vehicles can of course last longer, whether they are BEVs or ICEVs. I should note that increasing or decreasing this number a bit does not really change the results in any material way since it applies to all vehicles in the model.

BEV Longevity — As discussed last article, the idea that BEVs last longer than ICEVs is something industry analysts continue to debate. With more data becoming available, industry writers seem to be getting comfortable with the idea that BEVs can last 50% longer or even more. Common sense suggests they should last longer, based on their simplicity, but the fact is we do not have enough data yet to be sure. Again, I will not overthink this point and will simply include two costing models, one where the BEV lasts only as long as an ICEV (160,000 miles) and one where the BEV lasts 50% longer (240,000 miles). Readers can decide for themselves, and, either way, they can see the impact if BEVs do prove to last 50% longer.

Miles Driven — I’m going to use a number a little above the US average (15,600 miles/year) since this is a lifetime cost model and I wanted to keep the projection to 15 years max (the US average is 13,500). According to the Federal Highway Administration (FHA), people drive full and mid-size trucks pretty much the same number of miles per year as cars, so this number is plenty accurate for this analysis.

Towing & Hauling Miles — With about 3 million full and midsize trucks sold yearly now, trucks are clearly popular vehicles. The people who buy them, however, seem to use them differently than one would assume. If you were to believe some of the participants in online BEV forums, you would get the impression that truck buyers commonly tow heavy loads 12 hours a day at 80 MPH. Further, these drivers apparently never stop to eat or pee — presumably because their time is so valuable, I guess. Interestingly, for those who value reality at least, the data suggest a different story.

The consulting firm Strategic Vision surveys 250,000-people yearly to understand, among other things, how people use their vehicles. In their 2019 survey, they found that a full 75% of truck owners only tow once a year or less, and nearly 70% only go off-road once a year or less. Further, 35% of truck owners report using their truck to haul stuff just once per year or less. Clearly, most truck buyers do not tow, and they really do not carry loads as much as one would think.

For this analysis, I again won’t overthink it and instead I’ll supply 3 different towing models (low, medium, and high) to help gauge the impact of towing. The low model would be in line with most normal buyers towing 5% of the time, the medium model is quite high use at 25% of the time, and for fun, the high-use model will see the owner towing 50% of the time. I see 50% as approaching the maximum since presumably people who tow this much would be doing so commercially and would only be loaded one way. No matter how much you personally tow, the economic trend across these three models will be clear in this analysis.

Salvage Value — We do not have great information on this variable, but, fortunately, it is not a particularly material variable in the model. I used a range between $2,000 and $8,000 total, accounting for purchase price and battery size as appropriate. Battery salvage value is material at $42/kWh according to statista.com, but I chose to be conservative by limiting battery value to just $3,000 extra.

Fuel Economy/Cost — I used government EPA figures for fuel economy, plus the IEA 2022 US average prices for electricity and gas at 14.9 cents/kWh for home electricity, 25 cents/kWh for L3 charging, and $3.97/gallon for gasoline. Average Supercharger use is currently 20%, and home charging 80%. Fuel range while towing was projected at 50% less, as this seems typical for both BEVs and ICEVs depending on the aerodynamics and weight of the trailer. I should note that individual testers/publications were not consistent in their results, but 50% seemed the most reasonable figure to use assuming reasonable trailer aerodynamics, driving at the speed limit, and a trailer weight of around 6,500 lb.

Repair Costs — I used repair costs from YourMechanic.com and cross-referenced against other sites. We do not have great data yet on BEV repair costs, but the data we do have seems to suggest 50% lower costs vs. comparable ICE cars as a conservative estimate. That said, repair costs increase with higher mileage, so some of the models I’ll discuss end up with BEVs having the same or higher repair costs in their later years on the road.

Insurance — Many online sites have good breakdowns for average insurance rates. Insurance is highly variable at the individual level, so I just used national average costs for good drivers, allowing more for the more expensive vehicles in this group.

Financing — I assumed full financing on all vehicles at 60 months and 6.5% interest.

Trucks Compared — For this analysis, I included two BEVs, the Rivian R1T LR and the Lightning ER, plus three reasonably well equipped ICE trucks at different price points — an F-150 XLT 3.5, an F-150 Platinum 5.0, and a Raptor R. I chose only Ford trucks to keep things simple since pricing and performance between truck brands is essentially the same. I included the Rivian and Raptor as direct competitors and considered the Lightning and F-150 Platinum to be comparable competitors. The F-150 XLT of course is not as well equipped, but it is included as a cheaper option just to see how it performed. I should also note that according to CoxAutoInc.com, the average price of a new F-150 is now $66,450.

Results

Normal Towing Model (5% Towing)

Same Longevity Model — The Lightning was the cheapest truck in this group, at $111,780 over 10 years, saving about $20,000 over the F-150 XLT. Compared to the more similarly equipped F-150 Platinum, the Lightning saves $38,572. The Rivian proved much less expensive than the Raptor, at $30,500 cheaper.

Plus-50% Longevity Model — The Lightning in this model came in at $139,280 over 15 years, saving about $58,100 over the F-150 XLT, and $86,200 vs. the F-150 Platinum. The Rivian would save a massive $109,300 vs. the Raptor over its life according to the model.

I should note that to fairly compare costs for the plus-50% models, I simply multiplied ICEV costs by 1.5 so that we were directly comparing costs at the end of 240,000 miles driven either way. The math for the BEVs in this model, however, is not simply 1.5 times the 10-year BEV costs, since repair costs go up substantially as vehicles age. These models, in fact, suggest BEV repairs toward the end of their 240,000-mile life increase above end-of-life ICEV repair/maintenance (at 160,000 miles). This may prove higher than reality for the BEVs, but I wanted to be conservative.

As expected, the savings came primarily from fuel in the same-life model plus a little from repairs, and from fuel and vehicle savings in the plus-50% model. Insurance and repairs were roughly equal in the plus-50% model.

High Towing Model (25% Towing)

Same Longevity Model — The Lightning saved about $21,900 over the F-150 XLT. Compared to the more similarly equipped F-150 Platinum, the Lightning saves $40,800, and Rivian would save $34,800 over the Raptor.

Plus-50% Longevity Model — The Lightning in this model would save about $61,100 over the F-150 XLT, and $89,570 vs. the F-150 Platinum, with Rivian saving $115,700 vs. the Raptor over its life.

As expected, the increased fuel savings in this model resulted in an additional $3,000–$6,000 savings over the baseline (normal towing) model.

Crazy High Towing Model (50% Towing)

Same Longevity Model — The Lightning increased its saving to about $24,300 over the F-150 XLT and to $43,500 over the Platinum. The Rivian likewise increased its savings over the Raptor to $40,100.

Plus-50% Longevity Model — The Lightning in this model now saves $65,000 over the F-150 XLT, and $93,700 vs. the F-150 Platinum. The Rivian now saves $123,700 vs. the Raptor over its life.

Again, as expected, increasing fuel use due to towing simply resulted in even higher savings for BEV trucks. The added savings over the baseline (normal towing) model this time saved an additional $7,000–$14,000.

400-mile towing day

I thought I’d include a specific towing example calculating the real-world time and fuel cost/savings of our BEVs over a long day of towing. Assumptions for this example include all trucks starting with a full tank before leaving home, one meal stop in which the BEVs were unable to charge while refueling, time spent refueling, plus time spent to plug in/top off fuel at the end of the day. Many BEV owners of course would be able to charge while eating, so additional time savings* for BEVs is likely dependent on the route.

For each vehicle, I projected a 50% drop in EPA range for the entire trip and allotted 30 miles reserve fuel for all vehicles. I then calculated the number of refueling stops needed and time, assuming fast L3 EV charging/gas refueling. Please note the 30-mile reserve is quite conservative, as this is 45 miles based on the EPA estimate adjusting for a 50% drop in EPA range. BEV charging on L3 chargers during the route was estimated at 25 cents/kWh, which is the national average.

The Lightning in this example saves about $56 over the F150 XLT, and the Rivian is $144 less vs. the Raptor R in this single day of towing. Time cost for the BEVs ranged from 35 minutes for the Rivian to 1 hour and 20 minutes for the Lightning. The time “cost” would of course be eliminated for the Rivian if the meal and one charging were combined, and would reduce the Lightning’s extra time cost to just 35 minutes extra.

What does this all mean?

Trucks are expensive — No matter how you look at it, trucks are really expensive. One takeaway here is that if you do not need a truck, you are definitely better off buying a car! As outlined in my previous article on full lifecycle costs for cars, a Tesla Model 3 comes in at just $102,800 in these 15-year plus-50% models (which proved similar in cost to a Toyota Corolla). The Ford Lightning, the cheapest truck in this group, in comparison costs $139,280 under the same model — almost $37,000 more than the Model 3!

BEV trucks are relatively cheap — We have seen many 5-year analyses comparing BEVs vs. ICEVs that demonstrate how the total cost of ownership (TCO) for BEVs is lower for similar class vehicles, so this full lifecycle cost analysis is, once again, not surprising. The potential savings of buying a BEV in this class, however, proved to be much larger than it was for cars. Someone interested in an F-150 could save $65,000–$93,700 by buying a Lightning over a gas F-150 if the plus-50% model is valid!

This analysis also suggests that the current and upcoming crop of new battery-electric trucks will easily outcompete ICE trucks on cost, and it isn’t even close. Anyone interested in an electric truck should certainly put their name on a reservation list now!

Why would anyone buy a Raptor? — Raptors are not real work trucks, and are arguably most like a Rivian R1T LR in class, performance, specifications, as well as price. People generally do not buy this class of truck to tow, but rather for their performance and off-road capabilities. They are clearly expensive toys, and as a toy, the Rivian is simply more powerful, more capable, and massively cheaper than its ICEV competitors to own. The Rivian buyer could well save as much as $109,300 over its life according to the plus-50% life/normal towing model. Plus, they would have more powerful, nicer driving, and arguably be more capable vehicles.

BEV trucks will work for many but not everyone — yet — The 400-mile towing example clearly demonstrates some serious limitations for the electric trucks modeled. The Lightning, while proving to be the cheapest truck of the group, needed to be refuelled every 130 miles when towing. While this may work for some people on very specific routes, it is clearly not going to work for all. Longer-range electric trucks and/or reliable L3 chargers sited every 100 miles would be needed to attract buyers who tow regularly. Fortunately, as discussed earlier in this article, most truck buyers tow less than once per year, so range will simply not be a big issue for most buyers. With even longer-range electric trucks like Cybertruck and the RAM 1500 REV hitting the market soon, and with the IRA poised to increase the number of L3 chargers nationwide, my bet is this issue will be in the rear-view mirror in no time! What do you guys think?

By Luvhrtz