27 October, 2020 electric car

Costs for electric car production 2024 on a par with internal combustion

Another study predicts that by the middle of the decade the production costs of an electric car will equal those of petrol and diesel cars. According to an analysis by the Swiss investment bank UBS, reported by the British Guardian, the currently even higher production costs of electric cars are expected to reach combustion level by 2024.

Above all, the constantly falling battery prices are leading to an alignment of costs. Depending on model and manufacturer, the battery accounts for between 25 and 40 per cent of total vehicle costs. Already by 2022, the additional costs of producing an electric car are expected to be the equivalent of only 1600 euros on average. By then, battery costs should have fallen to less than 100 US dollars per kilowatt-hour. UBS’s calculations are based on a detailed analysis of data from the seven largest battery manufacturers. Thanks to the new cost structures, UBS expects e-cars to account for 17 per cent of global car sales in 2025, and electric cars are expected to account for 40 per cent by 2030.

Achieving cost parity with the internal combustion engine is seen as an important milestone for the slow balancing out of fossil fuels in passenger cars. UBS analyst Tim Bush, for instance, says that after 2025 there will be “not many reasons” left to buy a combustion engine.

However, even the current generation of electric cars offers worthwhile price advantages over combustion costs. For one thing, the environmental bonus of up to 9,000 euros can even compensate in part for the currently even higher purchase prices. On the other hand, electric cars are significantly cheaper to run than fossil-fuelled cars during their service life, thanks to the more efficient use of energy, among other things. In addition, there are a number of other financial advantages, such as the tax exemption that will apply until 2030. So actually there are already “not many reasons” to buy a combustion engine.

Source: Guardian – Guardian – Electric cars as cheap to manufacture‘ as regular models by 2024