The research team, led by Sikandar Abdul Qadir and Amjad Ali of King Fahd University of Petroleum and Minerals, built a Monte Carlo framework that runs 10,000 simulated ownership histories for each vehicle pair. Rather than fixing a single annual mileage or energy price, the model draws daily driving distances from a lognormal distribution fitted to Saudi survey data, in which 81.5 percent of drivers report travelling less than 100 kilometres per day. Maintenance costs, insurance premiums, and the growth rates of electricity and gasoline prices are likewise sampled from probability distributions. Energy prices follow a two-stage compound growth path, reflecting the observation that Saudi tariff revisions tend to occur roughly every five years. All costs are discounted at a fixed 5.5 percent rate, chosen for the Kingdom’s stable monetary environment and the peg of the Saudi riyal to the US dollar, and summed into a net-present-value total cost of ownership over ten years.

The choice of vehicles matters for policy relevance. Governments can only subsidise cars that are actually on sale, so the study paired the BYD Atto 3, priced at 99,900 riyals, against the Hyundai Elantra at 90,882 riyals, and the MG4 at 113,900 riyals against the Toyota Camry at 105,340 riyals. The electric models are more efficient by a wide margin: the Atto 3 travels 6.25 kilometres per kilowatt-hour and the MG4 6.86, while the Camry manages 17.2 kilometres per litre and the Elantra 15.5. Maintenance is modelled at 697 to 1,161 riyals per year for the EVs, roughly half the 1,626 to 2,500 riyals assigned to the combustion cars. The baseline assumes public charging at 0.99 riyals per kilowatt-hour, since nationally representative data on home charging are not yet available, and regulated gasoline at 2.18 riyals per litre. Notably, the model excludes a separate battery-replacement cost, because battery-ageing studies suggest modern packs retain roughly 79 to 87 percent of capacity after a decade.

Depreciation is where the economics turn. Because longitudinal resale data for electric cars in Saudi Arabia do not yet exist, the researchers applied mileage-based depreciation rates from international benchmarks: at 10,000 kilometres per year, EVs lose 15 percent of value annually against 8 percent for combustion cars, and the gap widens with mileage, reaching 22.21 percent versus 13.70 percent at 40,000 kilometres. Under this baseline scenario, which the authors call asymmetric depreciation favouring combustion vehicles, the gasoline cars dominate decisively. The Atto 3 costs 9.2 to 11.5 percent more to own over ten years than the Elantra across all mileage bands, and the MG4 runs 9.28 to 11.7 percent more than the Camry. At 10,000 kilometres per year, the Elantra’s levelised cost of driving is 11 percent cheaper per kilometre than the Atto 3’s. In the Monte Carlo classification, the combustion advantage exceeds 5 percent in 100 percent of simulations at every mileage level.

The picture shifts when the depreciation assumption changes. In a second scenario with identical depreciation rates for both powertrains, the results collapse into approximate cost parity: the EVs hold a slim 0.5 to 0.7 percent mean advantage at 10,000 kilometres per year, but the combustion cars claw back the lead as mileage rises, finishing 1.0 to 5.1 percent cheaper at higher utilisation. In a third, hypothetical scenario in which EVs retain value better than combustion cars, reflecting a maturing secondary market and tightening climate policy, the electric models win clearly at low and moderate mileage. The Atto 3 undercuts the Elantra by 3.9 to 12.8 percent in total cost, and the MG4 beats the Camry by 5.0 to 13.8 percent, though the advantage narrows and converges toward parity at the highest mileage band. The probabilistic classification confirms the pattern: at 10,000 kilometres per year, the EV advantage exceeds 5 percent in essentially all simulations, but at 40,000 kilometres the outcome is overwhelmingly parity rather than a decisive win.

Because Saudi summers are brutal, the team also stress-tested energy consumption with penalties of 10, 20, and 30 percent, consistent with field evidence that real-world consumption in extreme heat can exceed laboratory figures by 15 to 40 percent. Continuous air-conditioning and battery cooling raise electricity use, and one cited study measured a 28.4 percent increase in battery-electric consumption at 46 to 50 degrees Celsius relative to 26 to 30 degrees. The symmetric penalty applied to both powertrains erodes but does not overturn the scenario results. Under the EV-favourable depreciation scenario, the Atto 3 still holds advantages of 12,711, 8,960, and 4,034 riyals at the three lowest mileage bands even with the full 30 percent penalty, while the MG4 retains advantages of 15,089, 11,145, and 6,008 riyals. Under combustion-favourable depreciation, the gasoline cars remain cheaper throughout, with the EV gap reaching roughly 22,000 riyals at the joint worst case.

The most actionable findings come from the policy sensitivity analysis, which isolates fuel prices, charging tariffs, and purchase rebates. If Saudi gasoline prices, currently regulated at 2.18 riyals per litre, were to converge toward global averages of 3.5 to 4.0 riyals, the economics flip for anyone driving 20,000 kilometres or more per year: cost parity arrives at 3.5 riyals per litre for the Atto 3 and 3.75 for the MG4 at 20,000 kilometres, and the EVs dominate outright at 30,000 and 40,000 kilometres. Charging tariffs are equally decisive. At or below 0.30 riyals per kilowatt-hour, roughly the residential rate used here as a theoretical lower bound, EVs win for all drivers above 10,000 kilometres annually; at 0.50 riyals they still win for medium and high utilisation; but at the 0.99-riyal public-charging baseline they lose across the board. Purchase rebates deliver a third lever: a 15,000-riyal rebate achieves approximate cost parity for annual driving up to 30,000 kilometres, and 20,000 riyals or more secures a clear EV advantage, particularly relevant given that the Saudi average for private cars is about 23,942 kilometres per year.

The authors are careful about what their scenarios do and do not prove. The three depreciation cases are structural sensitivity tests, not forecasts, and actual resale values will depend on battery health, warranty coverage, new-vehicle pricing, and the maturity of a Saudi used-EV market that barely exists yet. Insurance costs are modelled with an identical range for both powertrains, a simplification that should be revised as Saudi insurers accumulate electric-vehicle claims data. The selected models also differ in body style and size, so the findings compare specific market alternatives rather than universal properties of the two drivetrains. The study likewise stops at the consumer level: fiscal affordability, grid impacts, and emissions outcomes, including earlier evidence that each additional 1 percent EV share in the Saudi power system cuts total emissions by about 0.5 percent on average, sit outside the model’s scope.

Even with those caveats, the policy sequencing that emerges is unusually concrete. The authors recommend starting with purchase rebates to build initial market volume, then deploying measures that stabilise residual values, such as certified pre-owned EV programmes, extended battery warranties, and subsidies for second-hand electric cars, before gradually reforming fuel prices and lowering public-charging tariffs. They also warn, citing China’s experience, that prolonged rebate dependence can distort the vehicle market, so incentives should be recalibrated as the market matures. For now, the combustion car remains the rational purchase for most Saudi drivers, but the analysis shows the gap is not a law of nature. It is a function of resale confidence, electricity pricing, and fuel reform, and each of those levers is within reach of policymakers pursuing Vision 2030 and the Kingdom’s 2060 carbon-neutrality pledge.

Subject of Research: Total cost of ownership comparison of electric and internal combustion vehicles in Saudi Arabia

Article Title: Cost analysis of electric and internal combustion vehicles in Saudi Arabia: the role of depreciation, energy pricing, and purchase rebates

Article References: Abdul Qadir, S., Ali, A., Islam, M. T., Shahid, M., & Atawi, I. E. (2026). Cost analysis of electric and internal combustion vehicles in Saudi Arabia: the role of depreciation, energy pricing, and purchase rebates. Results in Engineering, 32, Article 113203. https://doi.org/10.1016/j.rineng.2026.113203

Image Credits: AI Generated

DOI: 10.1016/j.rineng.2026.113203

Keywords: electric vehicles, total cost of ownership, Saudi Arabia, depreciation, Monte Carlo simulation, energy pricing, purchase rebates, levelised cost of driving, charging tariffs, fuel prices, Vision 2030, transport decarbonisation