By 2026, larger vehicles such as 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 cars ‘will be cheaper to produce than fossil fuel vehicles by 2027’ – Guardian – May 2021
The biggest single cost of Electric cars is the battery, however batteries continue to reduce in price as the numbers produced increase. As investment in Research and Development accelerates the prices will decrease. It’s anticipated by researchers that new EV battery chemistries are being adopted faster than in the past.
Predictions of price parity between Electric and Petrol / Diesel cars are drifting further into the future. Bloomberg’s Electric Vehicle Outlook 2020 predicted parity for large cars in Europe would be in 2022. In October UBS predicted 2024 and now Bloomberg says 2026.
Electric cars cheaper due to reducing battery and productions costs
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.Electric cars ‘will be cheaper to produce than fossil fuel vehicles by 2027’ – Guardian – May 2021
Tim Bush, a UBS analyst, said that the reduction in battery costs would also largely eliminate the financial case for hybrid electric vehicles, which combine a battery with a conventional engine.Electric cars ‘as cheap to manufacture’ as regular models by 2024 – Guardian – October 2020
A study, commissioned by Transport & Environment, a Brussels-based non-profit organisation that campaigns for cleaner transport in Europe, predicts new battery prices will fall by 58% between 2020 and 2030 to $58 per kilowatt hour.Electric cars ‘will be cheaper to produce than fossil fuel vehicles by 2027’ – Guardian – May 2021