Battery prices are expected to plummet
Automakers are starting to bring more affordable EVs to market, but these cars are still much more expensive on average than their gasoline counterparts. And it will take well into the next decade for electric vehicles to catch up, according to new research from Bloomberg New Energy Finance.
Electric vehicles are expected to see a consistent drop in prices for the foreseeable future. In the U.S. and Europe, EVs will actually cost less than gas-powered cars by as early as 2025, the report says. A main factor behind this change is the expected drop in battery prices, which account for about half the cost of electric vehicles today. Batteries are estimated to cost about 77 percent less between 2016 and 2030.
A few other signs point to the middle of the next decade as a hot time for electric cars. Volkswagen Group, the world’s largest automaker last year, has made it a goal to offer more than 30 battery electric models by 2025. Volvo and Mercedes-Benz have also made EV benchmarks for the 2020s.
A Bloomberg report last year predicted that by as early as 2023, EVs could displace demand for 2 million barrels of oil a day, which is enough to cause an oil crash. The estimate assumed global EV sales would grow at their current rate of about 60 percent, although a more conservative estimate pointed to 2025 as the year for an oil crisis.