Economic Viability of Electric Vehicles in the Kingdom of Saudi Arabia: Insights from a Monte Carlo-Based TCO Model

The rapid adoption of electric vehicles (EVs) is expected to substantially reduce emissions in the transportation sector of the Kingdom of Saudi Arabia (KSA). However, a large-scale transition toward EVs also introduces challenges related to vehicle ownership costs. This study develops a Monte Carlo-based techno-economic model to evaluate the total cost of ownership (TCO) for representative EVs and internal combustion engine vehicles (ICEVs) under KSA conditions. The model incorporates vehicle cost, insurance, maintenance, registration, fuel and electricity price, and Vehicle Kilometres Travelled (VKT) - based depreciation. Results show that under the Baseline scenario, EVs are marginally cheaper at low mileage (10,000 km) but lose this advantage as ICEVs become progressively more cost-efficient at higher distances. In the City scenario, EVs also record an early cost advantage up to 20,000 km, after which ICEVs surpass them. Under the Highway scenario, EVs are consistently more expensive across all mileage levels, with the disadvantage widening significantly at higher VKT. These findings highlight that EVs can be cost-competitive in baseline and city scenarios at low mileage, but ICEVs remain more economical for longer-distance use, especially under highway conditions in hot climates. The results provide evidence-based insights into the economic viability of EV adoption in KSA and the potential requirements for supporting policy interventions such as residual value guarantees, electricity price stability, and investment in charging infrastructure to ensure competitiveness with ICEVs across diverse driving conditions.