From Ownership to Usage: An Economic Analysis of Total Cost of Mobility for Electric and Internal Combustion Vehicles in India

Vani Y.D. Satyan; Vilas M. Kadrolkar Kadrolkar

doi:10.36948/ijfmr.2026.v08i05.89040

From Ownership to Usage: An Economic Analysis of Total Cost of Mobility for Electric and Internal Combustion Vehicles in India

Author(s)	Mrs. Vani Y.D. Satyan, Dr. Vilas M. Kadrolkar Kadrolkar
Country	India
Abstract	India's transport transition is usually framed as a question of vehicle ownership: is an electric vehicle (EV) cheaper to buy than a petrol one? This framing hides the real economic unit of consumer decision-making, which is the cost of the mobility service actually consumed. This paper proposes the Total Cost of Mobility (TCM) framework, which extends the conventional Total Cost of Ownership (TCO) by expressing all acquisition, energy, maintenance, insurance, charging-infrastructure, battery-risk and residual-value costs per kilometer travelled, and by treating annual usage as the decisive variable. A mixed-methods design combines (i) a bottom-up TCM model for two-wheelers and passenger cars under Karnataka price conditions and (ii) a primary survey of 385 vehicle users from nine districts of Karnataka, supported by secondary data from VAHAN, the Ministry of Heavy Industries, NITI Aayog and the International Energy Agency. The model shows that an electric two-wheeler costs about ₹2.90 per km against ₹4.22 for its petrol equivalent over a five-year horizon (a saving of roughly 31 per cent), and that it breaks even at only about 4,100 km a year. An electric hatchback, by contrast, costs about ₹16.1 per km against ₹13.4 for a petrol car at 12,000 km a year, and breaks even only at roughly 18,300 km a year, a usage level typical of taxis, ride-hailing and fleet vehicles. Ownership price therefore misleads: the economic case for EVs is strongly segment- and usage-dependent. The paper discusses macroeconomic implications for oil imports, the current account, state revenue and employment, and offers policy recommendations that shift support from purchase subsidies towards usage-linked incentives, charging infrastructure, battery-health certification and resale-value assurance.
Keywords	: Total cost of mobility; total cost of ownership,electric vehicles, internal combustion engine, usage-based economics,Karnataka,India, consumer adoption, energy transition n
Field	Sociology > Economics
Published In	Volume 8, Issue 5, September-October 2026
Published On	2026-10-11
DOI	https://doi.org/10.36948/ijfmr.2026.v08i05.89040

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From Ownership to Usage: An Economic Analysis of Total Cost of Mobility for Electric and Internal Combustion Vehicles in India

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