The widely held belief that plug-in hybrid vehicles (PHEVs) offer a cheaper alternative to fully electric cars is being challenged by new research. Analysis of the UK market suggests that, for many of the most popular models, the opposite may now be true. The findings arrive at a time of rising fuel prices and shifting consumer interest in low-emission vehicles. They also feed into a broader debate about the role of hybrid technologies in the transition towards fully electric transport.
Higher Upfront Costs Undermine Perception of Affordability
According to analysis by the Energy and Climate Intelligence Unit (ECIU), eight of the UK’s ten best-selling plug-in hybrid vehicles are more expensive to buy than equivalent battery electric vehicles (EVs). On average, the recommended retail price of these PHEVs is £4,150 higher, representing a roughly 10% premium compared with similar electric models.
The data includes direct comparisons between models from the same manufacturers. The Volkswagen Tiguan PHEV is listed as £5,780 more expensive than the Volkswagen ID.4 EV, while the Ford Kuga PHEV costs £4,035 more than the Ford Explorer EV. A similar pattern appears in other segments, such as the MG HS PHEV, which is priced £3,400 above the MG S5 EV.
This trend challenges the common assumption that PHEVs are cheaper due to their smaller batteries. While hybrids combine an electric motor with a petrol or diesel engine, the additional mechanical complexity appears to offset any savings from reduced battery size.
Separate data also points to broader pricing shifts across the market. According to Autotrader, the average price of a new electric car has fallen below that of petrol models for the first time, with EVs averaging £42,620 compared with £43,405 for petrol vehicles. The platform attributes this change to government support and sustained discounting by manufacturers, which has narrowed the price gap.
Despite these developments, demand for plug-in hybrids continues to grow. Figures from the Society of Motor Manufacturers and Traders (SMMT) show that PHEVs accounted for 13.0% of new car registrations in March 2026, up from 9.5% in the same month a year earlier.
Real-World Fuel Use Adds to Ownership Costs
Beyond purchase prices, the ECIU analysis highlights differences in running costs between hybrids and fully electric vehicles. Based on manufacturers’ official figures, the UK’s best-selling PHEVs are expected to cost around £540 per year for fuel and electricity combined. However, real-world data suggests significantly higher consumption.
According to the same analysis, PHEVs use approximately 490% more fuel than manufacturers claim. This raises the estimated annual fuelling cost to £1,030, nearly double the official figure. As a result, PHEVs are calculated to cost around £620 more per year to run than comparable electric vehicles.
The increase in fuel costs has been linked partly to external factors. The ECIU notes that fuelling expenses have risen by 18%, or £160, following recent geopolitical tensions affecting oil prices. These conditions have intensified concerns about the exposure of hybrid vehicles to fluctuations in global fuel markets.
Colin Walker, head of transport at the ECIU, said the findings indicate a risk for consumers seeking to reduce costs. He stated that drivers may switch to vehicles that “simply won’t deliver the savings promised”, adding that PHEVs rely on petrol for most journeys and consume more fuel than expected.
Industry representatives, however, emphasise the role of hybrids as a transitional technology. Mike Hawes, chief executive of the SMMT, noted that manufacturers are required to test vehicles under standardised conditions and argued that PHEVs can help drivers adapt to electric driving. He also pointed to ongoing concerns about charging infrastructure and the cost of public charging as factors influencing consumer choices.
The debate takes place within the framework of the UK’s zero emission vehicle (ZEV) mandate, which sets targets for the proportion of new cars that must be fully electric. While the target for 2026 stands at 33%, manufacturers are allowed to meet part of this requirement through the sale of lower-emission vehicles, including plug-in hybrids. Government policy continues to support a gradual transition. Current plans confirm that all new cars must be zero emission by 2035, while hybrid vehicles will still be permitted in the interim period.
