BloombergNEF: Electric cars 'will be cheaper to produce than fossil fuel vehicles by 2027'

[Eugene]

Source: The Guardian

Electric cars ‘will be cheaper to produce than fossil fuel vehicles by 2027’

BloombergNEF forecasts result of falling cost of making batteries as well as dedicated production lines

Joanna Partridge
Sun 9 May 2021 21.00 BST

Electric cars and vans will be cheaper to produce than conventional, fossil fuel-powered vehicles by 2027, and tighter emissions regulations could put them in pole position to dominate all new car sales by the middle of the next decade, research has found.

By 2026, larger vehicles such as electric sedans and SUVs will be as cheap to produce as petrol and diesel models, according to forecasts from BloombergNEF, with small cars reaching the threshold the following year.

Electric vehicles reaching price parity with the internal combustion engine is seen as a key milestone in the world’s transition from burning fossil fuels.

The falling cost of producing batteries for electric vehicles, combined with dedicated production lines in carmarkers’ plants, will make them cheaper to buy, on average, within the next six years than conventional cars, even before any government subsidies, BloombergNEF found.

The current average pre-tax retail price of a medium-sized electric car is €33,300 (£28,914), compared with €18,600 for a petrol car, according to the research. In 2026, both are forecast to cost about €19,000.

-snip-

Read more: https://www.theguardian.com/business/2021/may/09/electric-cars-will-be-cheaper-to-produce-than-fossil-fuel-vehicles-by-2027

[TreasonousBastard]

1. If battery technology continues to expand (and no reason to think it won't) electric cars, without..

engines and transmissions, should be a lot cheaper.

[Salviati]

2. Exactly, ICE engines are a mature technology.

It's becoming increasingly more difficult to wring smaller and smaller improvements out of them, but EV tech is still newish, there's a lot more improvements to be made, especially in battery tech, still lots of big gains to be potentially made there.

[JohnSJ]

3. The limiting factors will be charging station infrastructure, and battery recycling

I would like to see hydrogen fuel cell expansion, because it doesn’t depend on fossil fuels in the generation of electricity which is where the recharging depends on currently

[WHITT]

4. The Question Is

will electric vehicles SELL for less than fossil fuel vehicles by 2027?

[PoindexterOglethorpe]

5. Bingo!

Every time people here start rhapsodizing about electric vehicles, I note that they are all vastly more expensive than I'm willing to pay, and the time for recharging is an issue for me, since I normally take a number of long drives every year. Once they have the range of my little Fit, and recharge as quickly as I can refill with gas, then I'll consider it.

[WHITT]

6. They Already Have

the next generation of lithium batteries. When they get them from the lab to the street, it will multiply the range by at least ten times, which would mean the death knell for ICE power. The problem that remains is the cost.

[PoindexterOglethorpe]

7. Cost is my number one consideration.

Every time I read the average American pays over $40,000 for a new car (often an SUV which is another topic altogether) I'm astonished. Not to mention the typical loan is five or more years. I keep on hearing sad stories of someone who purchased a new car and then it was totalled shortly after. Surprise, surprise, the insurance is for the replacement cost of the vehicle, not what you owe on the loan. Although I suppose it would be possible to build that into the cost of the loan.

I always pay cash for my cars. So I buy what I have the money for. It's good that I genuinely prefer smaller, more economical (in all ways) cars.

But anyway, once I can get a two or three year old electric for what I'd pay for the kind of car I currently own, then charging time will matter immensely.

[Auggie]

8. And the answer is ... maybe

Auto manufacturers and resellers will jump all over expanded profit margins. Bet any “savings” will be seen through flexible sales incentives like rebates.