Electric, Hybrid, or Gasoline Cars: What Does It Really Cost to Own One in Israel?

Owning a car in Israel, whether electric, hybrid, or gasoline-powered, involves significant ongoing expenses that can sometimes exceed the initial purchase price. For example, a gasoline car bought for 150,000 shekels, driven 15,000 kilometers annually and kept for five years, incurs an additional cost of approximately 152,000 shekels over that period. The largest expense is depreciation, accounting for about 71,000 shekels, nearly half of the total cost. Fuel costs add around 43,000 shekels, while maintenance and insurance each cost about 14,000 shekels, and vehicle tax approximately 10,000 shekels.

Comparing the three types of vehicles with the same purchase price and usage profile reveals that electric cars are slightly cheaper overall, costing about 124,600 shekels over five years. Hybrids cost around 136,300 shekels, and gasoline cars about 152,000 shekels. The 27,600 shekel difference between electric and gasoline vehicles translates to roughly 459 shekels per month. However, the advantage of electric cars is partly offset by their higher depreciation, which is about 12,700 shekels more than gasoline cars, especially in the first years. Additionally, higher insurance premiums reduce the economic benefit of electric vehicles.

Electric cars save nearly 40,000 shekels in operating costs, mainly due to cheaper electricity versus fuel and lower maintenance since they lack combustion engines. Yet, the resale value of electric cars remains uncertain due to rapid technological advances and new model releases. Hybrids offer a middle ground, reducing fuel consumption by about 25% and having depreciation similar to gasoline cars, saving around 16,000 shekels compared to gasoline models without the resale risk.

Three key factors influence these cost dynamics: the charging method (home charging is much cheaper than public fast charging), annual mileage (higher mileage favors electric vehicles), and ownership duration (depreciation is front-loaded, so shorter ownership means absorbing more depreciation costs). Policy changes also affect costs; the reduced vehicle tax for electric cars ended, and from 2026, electric vehicles will pay full vehicle tax based on price category. Purchase tax on electric cars has increased to 48%, and the subsidy cap has dropped from 30,000 to 22,000 shekels, making equal purchase price assumptions less realistic.

This analysis highlights the complex financial considerations Israeli consumers face when choosing between electric, hybrid, and gasoline vehicles, balancing upfront costs, ongoing expenses, depreciation risks, and evolving government policies.