I know most people don’t believe this, but it is likely that electric cars have a good chance of becoming far cheaper than ICE cars over the coming 5-10 years.<p>EVs are complex, but in ways that are much more subject to economies of scale.<p>For example, much of their value is in the software, which replicates for nearly zero marginal cost. Electric motor assembly is highly automatable and a fraction of the cost of assembling engines. There are no emission control systems, fuel systems, exhaust systems.<p>That leaves battery materials and construction, and these are dropping fast. Goldman Sachs just predicted pack-level prices will be below $100 KWh by 2025 and continue dropping by 11% per year throughout the decade.<p>In fact, BYD already sells a perfectly-reasonable EV in China for around $11,000 US equivalent.<p>There will, of course, always be premium priced EVs in the market, but I believe the lower bound of the market will be much lower than the Corollas, Tercels and Honda Fits of today.
This year is looking pretty interesting for batteries. We have the Li-on potentially dropping to $100 a KWH, that will probably also mean LifePO4 will probably come down to below $100, maybe $80 and then the introduction of Sodium Ion this year which is meant to get down to $40 a KWH.<p>So far Sodium Ion isn't delivering on that price drop, while the cars are all cheap but not yet really available the actual cells for sale on aliexpress and alibaba are all a lot more expensive than LifePO4 at the moment. The 13450 cells at 10Ah instead of the 15Ah for LifePO4 and at the moment are also 5x the price. Its just gouged early pricing currently but it should bring the price of home storage and car batteries down less than half of Li-on and LifePO4 but with a lower density.<p>Interesting year for batteries and EVs, lots of EVs cheaper than ICE vehicles coming out this year as a result.
Goldman Sachs report from November 1, 2023 that this is based off of: <a href="https://www.goldmansachs.com/intelligence/pages/electric-vehicle-battery-prices-falling.html" rel="nofollow">https://www.goldmansachs.com/intelligence/pages/electric-veh...</a><p>Here's a February 29, 2024 article from Goldman Sachs on the same topic: <a href="https://www.goldmansachs.com/intelligence/pages/even-as-ev-sales-slow-lower-battery-prices-expect.html" rel="nofollow">https://www.goldmansachs.com/intelligence/pages/even-as-ev-s...</a>
What’s never explained here is the why. Is the market for the raw materials cheaper because there is a decrease in demand or an increase in supply of raw materials in the market?<p>Articles that hand wave it as “due to inflation” are a bit frustrating.
As soon as that happens we will start to see the road tax somehow added on to our daily driving cost and the savings made by using electricity will be greatly reduced due to this tax making EV's just marginally better for cost. But we need to pave the roads somehow so I do expect this to happen and am okay with it.
<a href="https://thedriven.io/2024/01/25/worlds-largest-ev-battery-maker-set-to-cut-costs-in-half-by-mid-2024/" rel="nofollow">https://thedriven.io/2024/01/25/worlds-largest-ev-battery-ma...</a><p>"The CnEVPost article says the average price of square LFP battery cells in mid 2023 was around RMB 800 to RMB 900 per kWh. This means the price of an average 60 kWh battery pack will have dropped from $US6,776.00 to just $3,388.00 in just 12 months, saving EV manufacturers over $3,000 per vehicle."
Don't worry, prices will be back up soon enough:<p><a href="https://news.ycombinator.com/item?id=39705926">https://news.ycombinator.com/item?id=39705926</a>
I mean, I would also love to see a server rack battery at $99 per kwh, but of a different chemistry, LiFePO4, I wouldn't trust having any other type of lithium battery at home.