The cost of buying and operating electric vehicles (EVs) over the years has decreased to become on par with their gasoline-powered counterparts, according to an article in The Wall Street Journal. EVs’ government subsidies and incentives have played a part in this parity. Although the list price of many EVs is higher than their gas equivalents, the considerable savings on fuel and maintenance costs that an EV offers can make up the difference for some vehicles over the first two to five years of their lives. Additionally, the availability of public charging stations and improvements in charging technology are making EVs more attractive to buyers. The gradual accretion of countless technological improvements to the battery-manufacturing process and economies of scale in battery production have played a role in falling battery costs. Although Tesla has helped spur the industry to roll out new models, most of the vehicles at cost parity with their gas equivalents are non-Teslas. Iron-based batteries, such as new LFP batteries used in some models by Tesla and, in the future, by Volkswagen and Ford, have helped to keep the prices of nickel and cobalt from spiraling out of control. The article states that the biggest contributor to the overall change in the cost of EVs, and their premium compared to internal combustion engine vehicles, is battery costs, which have dropped 90% from 2010 to 2020.
Even-cheaper EVs to come.
There are grounds to anticipate that EVs will become even more affordable than their conventional counterparts in the near future. According to consulting company AlixPartners, the world’s automakers will spend more than $500 billion on creating and developing EVs by 2026. This investment, together with billions of dollars from the Infrastructure Investment and Jobs Act, will lead to even greater economies of scale in the production of EVs.
To read more see here: WallStreet Journal
