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EV battery costs falling to make EVs more affordable

EV battery costs falling to make EVs more affordable

A significant cost of electric vehicles is the battery. Any new technology will be expensive at first, especially something as complex as a car but the battery has a huge influence over the cost of a new car.

That’s going to be changing soon.

New battery technology means EVs should cost around the same as the average gas car by 2023/24.

That’s what BloombergNEF predicts anyway.

The cost of clean motoring

We already know that cost is the most significant barrier to entry for anyone considering a new car. Electric vehicles currently have a significant price premium over gas cars, which puts a lot of people off.

The battery is large part of that cost.

The report from BloombergNEF (New Energy Finance), cites reports from China that new electric buses are using batteries that cost less than $100 per kWh, which is how EV batteries are priced.

That’s significantly lower that we began seeing EVs on the road when batteries cost in excess of $1100 per kWh!

Production values

The reduced cost of batteries is partly down to the maturity of the supply chain and manufacturing and the acceptance of solid state batteries.

Until now, battery production was expensive. Lithium-ion batteries require lots of precious materials, careful handling and no little amount of lithium. The production chain took a while to refine the process.

Solid state batteries cost far less to manufacture than lithium-ion, around 40% less. Once this technology matures to the same level, it isn’t difficult to imagine prices falling even further as efficiencies and improvements are made.

Both of these things combine to make BloombergNEF think we could be looking at cheap EV batteries, and therefore, cheaper EVs within the next few years.

Cheaper electric vehicles

The lower cost of batteries will no doubt be passed on to consumers to help encourage uptake. With countries having banned fossil fuelled cars already and others considering it, electric is definitely the future.

Another upside to solid state batteries is the potential for increased range. Samsung announced earlier this year that they can build EV batteries half the size of current technology.

This could potentially double the effective range of an EV. We could go from a range of 200 miles up to 400 or even 600 miles within the next couple of years.

With cars like the Ford Mustang Mach-E setting showrooms alight with sales, it looks like the future of electric motoring is rosy. As long as tax and other incentives are still around in a couple of years, buying an EV could be cheaper than buying a gas powered car.

Now that’s the way to change the world!

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