Electric trucks look a lot more appealing when gas prices are sky-high

Electric cargo trucks have been getting more cost-competitive for years. But the fuel price spike triggered by the Iran war has made it clear just how much cheaper it can be to move freight with trucks that run on electricity instead of gasoline or diesel. 

New data from electric-vehicle manufacturer Workhorse, which runs identical routes with both gasoline cargo trucks and electric cargo trucks for its Stables by Workhorse business, provides a case study of how elevated gasoline prices make EV options more appealing. 

Stables delivers packages as an independent service provider for FedEx in Ohio. Its use of internal-combustion-engine and battery-electric trucks side by side has given it a rare ​“controlled, real-world comparison” of the two vehicle classes with ​“the same routes, the same drivers, and the same weather,” as explained in a presentation at the ACT Expo trucking industry show in May. 

The electric trucks Workhorse builds and runs in its Stables fleet, a type known as step vans, were already cheaper to operate last year than their gasoline-fueled counterparts — saving about 42.5 cents per mile, based on electricity at 11 cents per kilowatt-hour and gasoline at $2.98 per gallon. 

But by May 1, gasoline had spiked to an average of $4.83 per gallon in Ohio, pushing the savings advantage for electric trucks up to 73.6 cents per mile. With gas prices so high, a Workhorse step van driving about 50 miles per day can expect to save about $11,000 per year on fuel costs. 

The operating-cost difference matters a lot when it comes to electrifying truck fleets. EV trucks cost 50% to 100% as much as fossil-fueled versions, according to industry estimates, which means they need to provide enough savings on operations to make up for that higher sticker price.

In the past few months, Workhorse CEO Scott Griffith said customers have grown more interested in buying trucks from his company, which is a small-scale producer in the broader world of medium-duty truck manufacturing.

“The phone is certainly ringing, and the interest is high, and everyone’s doing the math,” he said. ​“What is the cost of electricity, what are the lease costs, what are the operations and maintenance costs? They’re coming in with a much more sophisticated approach.” 

Workhorse’s experience is only one example of how EV trucks are growing more appealing to fleet operators, said Corey Cantor, research director at the Zero Emission Transportation Association trade group. He noted that other fleet operations have observed similarly high savings as gas and diesel prices have spiked in recent months. While those prices have declined slightly since a purported peace deal between the U.S. and Iran last month, they remain significantly higher than before the war began. 

Diesel, which is the primary fuel for trucks around the world, has seen an even greater increase in cost than gasoline, putting pressure on fleet operators.

“When diesel is at such an elevated price — even if it may come down over the longer term — it spurs a conversation,” Cantor said. 

Making bets on electric futures

While the recent gasoline and diesel price spikes are driving conversations about electrification, it’s not clear whether that’s resulting in more purchases or leases of EV trucks. 

That’s mainly because the data hasn’t yet come in, said Jacob Richard, technical project manager at Calstart, a nonprofit group whose members include energy producers, carmakers, and other businesses. 

There’s plenty of room for growth. Electric trucks made up less than half a percent of the total U.S. truck stock as of mid-2025, according to Calstart’s January report Zeroing in on Zero-Emission Trucks.

Of the 72,000 electric trucks deployed in the U.S. at the end of last year, the vast majority were so-called ​“last-mile” delivery vans. Cargo vans — the smallest type of commercial cargo vehicle — are an ideal electrification target because they run relatively short routes to and from central depots where they can recharge overnight using slower, less-expensive charging infrastructure, said Mike Roeth, executive director of the North American Council for Freight Efficiency. 

The nonprofit research group has put vehicles through real-world tests in its ​“Run on Less” events and found that battery-electric trucks cost less to operate than fossil-fueled equivalents on the sub-100-mile daily routes that make up about half of all freight miles traveled in the U.S.

Griffith agreed that shorter-haul, ​“return-to-base” freight routes have been a good fit for Workhorse customers like Purolator and Gateway Fleets, both of which have placed orders for 100 of the company’s electric step vans this year. 

“Many of them are running what we call lollipop routes — 90 miles out from the depot, and coming back and charging up,” Griffith said. He added that ​“a significant chunk of medium-duty trucks” are running such routes, ​“especially the large fleets.” 

But electrifying medium-duty trucks is more complicated than electrifying cargo van fleets, Roeth noted. Medium-duty trucks range from step vans like the ubiquitous brown UPS delivery vehicles to box trucks that have different types of rectangular cargo containers mounted on separately built ​“cutaway” chassis. They tend to be built for a wider variety of custom markets in much lower quantities than cargo vans, which more closely resemble mass-market passenger vehicles in how they’re manufactured and marketed. 

“The smaller and more automotive you are, the greater the scale of production, the lower the cost,” Roeth said. ​“As you move to a cutaway, where you have to work with a different manufacturer to get that box on, the cost challenges go up.” That’s true for both EV and internal-combustion vehicles in this class, he said. 

Still, manufacturers of battery-electric trucks stand a good chance of making headway across market segments while fuel prices are high, Cantor said. 

He highlighted Harbinger Motors, a startup that manufactures medium-duty electric-vehicle chassis that can be customized for different classes of vehicles. The California-based startup has raised about $360 million in venture financing, including a $160 million round in November co-led by FedEx, which also ordered 53 of the company’s medium-duty truck chassis. 

Workhorse has taken a more circuitous route, Roeth said. He worked at the company back when it was an affiliate of Navistar International making chassis for internal-combustion-engine trucks. In 2013, Workhorse was acquired by startup AMP Electric Vehicles and shifted to making battery-electric chassis. 

Last year, it merged with long-time electric-chassis startup Motiv, in what Roeth described as ​“a perfect marriage.” Even so, it’s not easy to break into established medium-duty truck markets: Workhorse reported widening losses in its first earnings report as a combined company in the first quarter of this year, despite increasing revenues. 

Those losses were driven in part by higher investments in manufacturing, as Workhorse retools its factory in Union City, Indiana, for the latest generation of its all-electric chassis, featuring more efficient batteries, drivetrains, and power-control systems. That factory is capable of producing up to 5,000 vehicles per year. 

“We’re not just sticking an electrified powertrain on what we currently sell,” said Griffith, who was CEO at Motiv before the merger. ​“You can get some efficiencies out of that. But you can’t capture the full benefits of a fully software-defined vehicle without going all the way.” 

Getting to up-front price parity 

The primary barrier to fleet electrification is the up-front cost of electric trucks. Right now, ​“a standard rule of thumb is that these vehicles are going to cost two times more than the equivalent cost of a diesel or gasoline version,” Calstart’s Richard said. 

But there’s a lot of variation. Commercial vehicle pricing data ​“is not as transparent and easy to access as [data on] passenger cars,” Cantor said. Many vehicles are custom-designed, and pricing varies greatly depending on factors such as bulk purchase orders and preexisting relationships with fleet operators. 

In the case of Workhorse, Griffith estimated that the company’s electric step vans cost about 30% to 40% more than comparable fossil-fueled vehicles. In early April, Workhorse dropped the price of its standard-sized W56 battery-electric step vans by roughly $60,000 to bring them just under $200,000 apiece, about level with the highest-end gasoline- or diesel-fueled alternatives. 

The payback time on an electric truck depends on a mix of things — the model, state incentives, fuel prices, and so on. In states like California and Washington, which have generous incentives, buyers can recoup the extra costs on Workhorse’s larger step-van model in three to five years depending on gas prices, according to the company’s chief communications officer, John Williams. 

Whether these kinds of paybacks are fast enough will depend on the fleet operator.

In general, bigger operators can afford to take a risk and wait longer, according to Richard. But Calstart presumes that the majority of buyers need to see a payback in three years, which coincides with how they structure financing and resale planning for their internal-combustion fleet vehicles, he said. 

Today, the vast majority of electric trucks are being bought by big corporations that have both the deep pockets and the sustainability goals to make the up-front costs worth absorbing, Griffith said. 

“But this is a $23 billion-a-year industry,” he said, citing estimates of annual U.S. sales of medium-duty vehicles — and to meet the needs of the broader market, ​“we’ve got to get the price point down.” 

In certain regions, government incentives can nearly close that price gap, Richard said. Though the Trump administration and Republicans in Congress erased many of the federal tax credits that incentivized EV purchases, some EV-friendly states still provide incentives and rebates, he noted. ​“It makes sense for fleets to capture those up-front incentives while they stand.” 

But electric truck manufacturers can’t bank on government incentives, Griffith said. ​“Those dollars are disappearing in the coming years. The industry has to get to the point where [total cost of ownership] blows internal combustion out of the water — and the buying price of an EV has to be closer to a 10% premium.” 

To be clear, electric trucks offer significant benefits beyond lower fueling costs, Roeth said. Companies participating in his organization’s Run on Less events have tracked financial benefits like significantly lower maintenance costs as well as perks like increased driver comfort. Plus electric trucks release much less carbon and local air pollution — an important improvement, as commercial trucks are responsible for a disproportionate amount of such emissions from the U.S. transportation sector. 

“For good or for bad, these trucks are used in routes that are sitting and idling for long periods of time. They emit three or four times per mile the emissions and carbon you get out of a passenger car. And they’re on routes that tend to affect dense populations,” he said. 

Ultimately, Roeth said, ​“if we can improve the economics and emissions together, make everything better on that route, fleets are going to adopt it.”