[pqr]

HEV vs. Diesel vs. BEV: Total Cost of Ownership Study



The mid-size SUV segment in India now has three low-running-cost vehicle options available, based on different technologies: conventional diesel engine (ICE) from Hyundai-KIA; strong hybrid (HEV) from Toyota-Maruti; and pure electric (BEV) from MG. There are numerous use cases, and each product and technology comes with its own set of advantages and limitations. So which one to choose?

Toyota has been claiming that HEV technology is the right transitionary path to BEV adoption, and to walk the talk, Toyota brought strong hybrid technology to the masses in India in the form of the Toyota Hyryder, based on its non-identical twin, the Maruti Grand Vitara. MG has also launched the ZS EV facelift this year with an updated battery pack. The Hyundai Creta is due for a facelift early next year.

Safety



The European MG ZS EV received a five-star rating in the 2019 Euro NCAP crash test. ZS EV are imported as CKD units and are assembled at MG India’s plant in Halol, Gujarat. The Hyundai Creta only received a three-star rating in the GNACP frontal offset crash test (old protocol). The Toyota Hyryder is yet to be tested.

Dimension



Exterior dimensions can be deceptive, because actual usable in-cabin and boot space depends on overall packaging done by designers and engineers, and potential buyers need to examine cars in person and make a final decision based on family needs.

Power & Torque



The MG ZS EV has a very powerful drivetrain and offers exhilarating performance, typical of most BEVs. Perceived value for exhilarating performance needs to be mentally factored in at the time of relative price to value analysis. Hyryder’s hybrid system is only tuned for efficiency, and the fun factor took an extreme back seat. The power to weight ratio gap is 17 PS per ton. Though the power output of the Hyundai Creta is the same as the Toyota Hyryder, the high torque output of the diesel engine makes the real difference, along with the smooth torque convertor transmission. For drivability, potential buyers need to take a test drive themselves or may refer to several available reviews.

Features



Feature-wise, all products are well matched, covering all the basics with some differentiators.

Total ownership cost = purchase cost + running cost + maintenance cost differential

Now this study will focus on the theoretical customer benefit part, i.e., the total ownership cost that includes purchase cost, running cost, and maintenance cost differential. Since use cases vary a lot, this study will be more of a theoretical exercise, and the outcome is more indicative than a definitive conclusion.

Starting point

Higher fuel efficiency leads to lower average running costs, which offset the higher initial cost of purchase of vehicles, thus delivering a higher monetary benefit over the long term, provided the vehicle covers higher mileage every year.



Assumptions and caveats:

Efficiency

• Overall efficiency claimed by manufacturers is considered here for running cost calculation.
• Manufacturer claims are based on the Modified Indian Driving Cycle (MIDC) and were tested on a dynamometer in a controlled laboratory environment.

• Vehicles are tested at an average speed of 32.9 km/h with a maximum speed reaching up to 90 km/h. All auxiliary power consumption units are switched off (AC compressor, headlamps, infotainment system, etc.).
• Real world efficiency would be different due to different load conditions, speed, gradient, idling, and auxiliary load (AC compressor).
• This can be seen in the Autocar real world fuel efficiency test as well. Real world efficiency varies from claimed figures by 15% to 27% in the case of the Maruti Grand Vitara HEV and 26% in the case of the MG ZS BEV.

• For indicative comparison, MIDC values hold good, since all vehicles are tested under the same conditions with pre-conditioning.
• Due to regenerative braking, HEVs and BEVs are typically more efficient in stop-go city driving conditions.
• However, efficiency will come down during highway driving as the engine will stay on for most of the time in the case of HEV and regenerative braking could be limited in the case of both HEV and BEV.
• On the other hand, diesel engines will be more efficient during highway runs than in city conditions.

Battery life and resale value

• What is the biggest unknown here is the resale value of products with HEV or BEV technology in India.
• Moreover, manufacturers never tell the actual battery life and cost of replacement at the time of product launch or sale, though they know the facts due to endurance tests they undertake during the product development phase.
• This is the area where potential buyers and existing customers will largely remain in the dark before reality hits them (if ever) in the form of battery replacement costs and affect on the resale value.
• Because of technological advancements, the current generation of BEV product range may become obsolete in the future.

On-road Price

• There are many states where BEVs are exempt from the 15-year road tax, and that has been factored into the BEV on-the-road price.
• Road taxes vary from state to state. Here, the average rate is considered to be 10% for ICE and HEV.
• Because the minimum insurance cost as a percentage of the car price and TCS remain largely unchanged, they have not been considered here.
• The regular maintenance cost of diesel and petrol ICE is factored in, as other costs (tyres, brake pads, etc.) remain the same for BEV.
• The MG ZS EV is imported through the CKD route and is subject to customs duty, resulting in a pricing disadvantage.

Break even simulation: based on changing fuel price

Fuel prices vary a lot over a time period as they are subjected to a lot of factors. From 2017 onwards, petrol and diesel price differences came down, thus reducing the running cost benefit diesel engines have.



Below is the break-even simulation based on different fuel prices.















Break even analysis

In the pre-pandemic era, average fuel prices remained below ₹ 80. However, in the last three years, fuel prices have gone through the roof, and the cost of running has become an even more crucial factor in purchase decisions.

The below table summarises the indicative breakeven point based on different petrol price points. A purchase decision has to be based on an individual's use case and charging convenience.

• Higher running within the city and higher fuel prices make the case for HEV and BEV against diesel.
• Diesel makes more sense when fuel prices are low or highway usage is high.
• Special case of NCR: National Green Tribunal (NGT) in April 2015 banned diesel vehicles more than 10 years old and petrol vehicles more than 15 years old from plying within Delhi-NCR. Due to NGT rules, HEV will have a 5 year advantage over diesel in the NCR region, and BEV has no disadvantage at all.
• Unknown rechargeable battery life in Indian driving conditions (temperature, moisture, etc.) is the biggest blind spot as of now. Unknown to customers but well known to manufacturers, what a shame!

Scenario 2

BEVs in India are taxed at a 5% GST rate, whereas strong hybrids longer than 4m in length have a 43% GST incidence. The 15-year road tax is also exempt in many states for BEVs. These two government concessions make BEV a viable option for reducing pollution in the immediate vicinity. But are BEVs really a financially viable alternative to HEVs and pure ICE in the long term without government support? Let’s try to examine that aspect too.



Without applicable tax, the BEV is ₹ 11,36,790 more expensive than the HEV. What should be kept in the back of the mind is that the MG ZS EV comes through the CKD import route and is more powerful.



The simulation below is based on the non-concessional price of HEV and BEV.















Analysis

Without government concession programs, BEV does not seem to be a financially viable alternative, even when fossil fuel prices are high. To what extent local production of cars and cells built under the ACC PLI scheme with imported raw materials in India, along with economies of scale in battery production, bridge such a wide gap in cost in coming years? Only time will tell.

Green credential



If grid electricity's CO2 footprint is factored in, the BEV loses its green credential. But then that’s not BEV’s fault; this is due to the heavy reliance on fossil fuels as a major power generation source in India. Pure solar-based charging points are far and few, and mostly not viable in heavily urbanized regions of India.

For the time being, BEVs are only assisting in shifting pollutants to the location of thermal power generation due to zero tailpipe emissions. What India needs is an urgent and rapid diversification of renewable power generation sources.

[giri1.8]

Originally Posted by pqr

Green credential

Attachment 2368467

If grid electricity's CO2 footprint is factored in, the BEV loses its green credential.

For the time being, BEVs are only assisting in shifting pollutants to the location of thermal power generation due to zero tailpipe emissions.

Great analysis, hats off to you for this detailed comparison!

Shocking to see the price of EV vs Hybrid without tax, once there are enough EVs on the road, government might increase the tax to compensate for their loss of income, which in turn will make EVs less attractive.

This might be a good time to get an EV, as the prices are only going to increase despite any reduction in battery cost. No guarantee though.

Total emission part seems weird, car that pollutes the most gets green number plate?

[ajayc123]

Hey pqr, thanks for the comprehensive analysis. Very helpful in reaching the following conclusion

My takeaway is that after initial spend at the time of the purchase, and 1 lakh kilometer of usage, say over 10 years, you may be here or there by 1 lakh (after factoring in fuel / charging expenses). Which means that the when the saving is staggered over the lifetime of ownership, it appears almost like loose change, just about a 1-2 k here or there per month.

So, I have reached a conclusion that I am not going to break my head over the breakeven calculations, but simply choose the one I will enjoy the most over the ownership.

[Carma2017]

A very detailed analysis but almost exclusively centred on Cost. Globally one does not buy an EV to save operating costs or for driving pleasure alone. It's a green solution as marketed to the entire world. Looking at India's massive reliance on Coal powered power plants and looking at the mediocre Range of EVs launched till now, a normal EV like Nexon or Tiago/ Tigor would have to be driven close to 1.1 to 1.2 Lac km to break even in terms of life time pollution as per a calculation by Autocar. So, definitely an EV in India today would not give you Green Cred but would give cost savings for sure.

For the OEMs, the EVs today serve two purposes. Firstly, it allows them to get a foothold in the nascent Green Car Market and gives them Green Cred which is essential to tap the next gen buyers who are more informed and more concerned with the environment in general. Secondly and more importantly, it allows an OEM to launch the high profit margin Gas Guzzlers and Big SUVs against the positive points gained from EVs under CAFE rules. That is how most OEMs in India plan to survive without having a single small car in their line up. It might sound cynical but it's a business and the government has to give sufficient incentives to OEMs to switch to EVs.

But what worries me the most, is the reliance on rare earth materials for batteries as it is China's domain. So, essentially we are swapping our dependence on Middle East for Oil with China, an even more dangerous entity. This worry gets exacerbated when I read news that Armed forces are looking to procure EVs. Electric vehicles are a global low pollution solution for sure but i don't think it's THE solution for India. India either needs a varied mix of Mobility Solutions or an India specific local solution indigenous to us which removes/ reduces dependency on any other country. I am banking on the second for sure.

[jetsetgo08]

Great thread with detailed analysis.

IMHO, low running cost is still the prime factor for majority of the EV buyers in India. Very few do actually care about making a greener world.

Thankfully, there are cheap loans to cover for the initial expense but not the monthly running expenses, which could amount to >Rs.10-15k for a gas guzzling ICE vehicle.

On paper, strong hybrids do seem the best alternative during this transition phase.

[GTO]

Great thread, thanks for sharing . On the top of our homepage today!

The cost of EVs will only come down with time. Hybrids might also get cheaper (depends on how much Maruti-Toyota commit to them), but EVs will definitely benefit from mass manufacturing in India and we'll see cheaper models. Heck, the very competent Tiago EV already starts at 8.5 lakh rupees.

On the other hand, diesel cars will get more expensive with time due to emission norms. Once BS6 Stage 2 emission norms kick in, believe it or not, the cost of the emissions system will meet / exceed the cost of the engine for some OEMs!!! It's that complex.

Petrol & Diesel will only become more expensive with time too. Electricity prices do go up, but not at the pace of petrol / diesel.

[ergon_9700]

Hello all, this is my first post/reply on this forum and would like to thank the moderators for accepting me on this forum.

Coming to the post, this is a very accurate and detailed analysis but as said by Carma2107, this is centered on cost only. And also his point on how EVs are polluting before their wheels are turned. If we look at HEVs also they are more polluting than petrol/diesel but less polluting than EVs because of their battery size. The same was emphasized by Shapur Kotwal in a blog in Autocar in an opinion column. But I believe in India pure ICE vehicles will last for another 15 years max diesels included.

Since alternative fuels was mentioned here, I read an article where diesel engine was retrofitted to run on Hydrogen, which I think will reduce the cost of product development significantly and also running cost though it will be more than EVs due to high cost of Hydrogen, pollution will go down significantly as its final product post combustion is water. Though it has its own challenges, I think it will be better than BEVs in the future due to rising demand, Lithium production will shoot up causing more pollution than reducing it.

I think this is why Toyota is bullish on FCEVs than BEVs as it lead to net zero carbon emissions in future.

Link to the article mentioned: https://interestingengineering.com/i...-hydrogen-fuel

Opinions are welcome.

[SKC-auto]

If grid electricity's CO2 footprint is factored in, the BEV loses its green credential.

No, the Well to Wheel emissions of ICE are not added in the graph. The life cycle emissions of EVs are better than ICE and they will improve over the next few decades. And we also did not talk about other toxic particulate emissions from ICE cars.

https://www.theguardian.com/environm...-unborn-babies

Originally Posted by ergon_9700

I think this is why Toyota is bullish on FCEVs than BEVs as it lead to net zero carbon emissions in future.

Toyota sold 10 FCEVs in August, 7 FCEVs in September in all of US, actions speak louder than words, don't believe in Hydrogen scam.

[GeeTee TSI]

Great presentation! Would be great if the same model in ICE and BEV avatar can be added to the analysis (Eg: Tiago ICE vs Tiago BEV and so on with Nexon and ZS EV/Astor)

[aim120]

The on road price varies from state to state and in cities like Bangalore, Hyderabad, Chennai etc the tax is very high Rs 2.5L to 2.7L more then what is shown in the graph for IC and hybrid vehicles.

Also electricity price is not the cheap every where, when you get a EV chances are you will be in the Max slab rate which nears Rs10/ unit with GST.

But for those who have solar, it will be significant savings.

[lina]

How green the grid is differs vastly from state to state. Karnataka for example has a relatively larger greener share. Currently 20% is solar. Hydel is on top of this (Total share of renewables is 50% according to the article shared). Fellow Bangaloreans will note that the electricity situation has drastically improved in summer months over the last few years. This is largely because earlier, hydel power used to dry up in summer which is now being compensated with Solar.

https://www.thehindu.com/news/nation...le65327048.ece

https://timesofindia.indiatimes.com/...w/81752322.cms

[svmvale]

Very interesting thread.

Diesel vs Strong Hybrid go neck to neck in terms of break even. But I found my Vento TDi AT's torque is awesome to use. Hybrid's also have strong torque figures when compared to the naturally aspirated variants.

Break even considers only initial buying cost, but I understand after 8yrs, EVs and Hybrids need to change their batteries which at current cost is around 12L. Taking this cost into considerations for 1.5L kms and 10yr ownership, will swing the scales back towards Diesels.

Camry Hybrid - 6yr old with 50000 kms are available for 18-20L, because the cost of battery change needs to be factored in by the buyers.

[UD17]

Thanks for the interesting thread, it really provide a different perspective for sure.

I would stick to a propulsion technology which i feel more reliable, useable and convenient. For now the EVs do not sound very mature. For my 2023 purchase, i am not even considering an EV for the obvious reasons of unreliable ecosystem (technology/infrastructure) at least in India. I will stick to gasoline car, but i am ready to consider the hybrids.

Break even calculations usually good only for the indicative outcome, it for sure did not provide definitive conclusion for a user (as also mentioned by 'pqr' in the thread). Why? The initial cash outflow is much easier to achieve for most of the users, thanks to various finance schemes running across the industry. The biggest anxiety a user face during the ownership period is the running cost of the car. He has to spend out of pocket to run the car (fuel), pay the servicing and insurance. If these running expenses are high, it pinch. This is the reason the CNG cars are still selling like hot cakes and for the same reasons the EVs will get a boost in sales in coming future, provided the infrastructure is reliable.

[arsenalfan]

i think taking rs 5 per kWh for ac charging is way too less. it costs rs 10 across most cities for residential power consumption. i pay rs 5k for 500 units every month approx. the costs will change sharply with this math

[Hayek]

Great analysis. But to my mind, the main value of a recognisable BEV is the same as that of the original Prius, which is advertising the owner’s green credentials. By adopting green number plates for BEVs, the government has turned them into a status symbol - at least in my building, a ZS EV or even a Nexon EV turns more heads than an E Class. May be that will change with time - but Moore’s law type dynamics will apply to EVs over time, and their cost is only likely to fall. Any rational calculation will show that a diesel is superior to an EV - but for lots of users such as myself (who run less than 10000 km per annum), a petrol makes even more sense. So if we buy an EV, it is for the Green Plates - and certainly not for economic benefit of EV ownership,