Electric Vehicles Set To Become More Affordable As Battery Prices Drop

Discussions about electric vehicle (EV) sales often focus on a constant rise, but the reality is bumpier. Surges in adoption lead to excitement, while slowdowns fuel skepticism. These fluctuations reflect market evolution. When consumer demand spikes, production struggles to keep pace, causing supply crunches and higher prices. Conversely, periods of rapid production increase can lead to oversupply and price drops.

Battery prices, a key factor in EV affordability, are expected to decline significantly in 2024 and 2025, according to Goldman Sachs. This decrease should translate to lower EV prices, further boosting sales.

Goldman Sachs predicts a near 40% drop in battery prices by 2025, potentially bringing EVs to cost parity with gasoline cars in some markets without subsidies. They also project a significant increase in EV market share, reaching 50% in the US and 68% in the EU by 2030.

While the battery price trend is promising, forecasting EV sales further out is complex. The 50% and 68% figures for the US and EU might even be underestimates, suggesting a potentially brighter future for EVs.

Electric Vehicle battery costs are expected to fall for two reasons. First, the price of materials used in batteries is going down. Second, battery makers are constantly improving their technology.
Electric Vehicles Set To Become More Affordable As Battery Prices Drop

One way they’re doing this is by simplifying how batteries are built. This makes them cheaper and easier to produce. They’re also looking at using new materials, like silicon, which could make batteries charge faster and hold more energy.

The future might hold even bigger breakthroughs, like solid-state batteries. These are completely different from today’s batteries and could allow for even more powerful and efficient electric vehicles. However, this is still a future possibility, not something we can count on for sure.

Reference- Goldman Sachs report, Clean Technica, National Geographic, Inside EVs, The Verge