Some people choose not to buy EVs as they are, on the whole, more expensive that the combustion engine version of the model. Many people do not want to go for a less luxury brand or sacrifice of looks to get an EV within the right price range.
The main reason why the EV models are a bit more expensive is the manufacturing cost. The resources for the manufacture of lithium batteries are expensive and this translates into the overall price of the model.
However, the extra cost of manufacturing battery electric cars when compared to fossil fuel equivalents are likely to reduce to only £1,470 per car by 2022 and are hoped to completely disappear by 2024. This is according to research by the investment bank UBS which was based on analysis from the seven biggest battery manufacturers.
Making EVs more affordable means they will be more accessible to the wider public. Unfortunately, we are driven by the cost of things and making the UK switch to electric needs to also make sense from a cost point of view.
Batteries are almost exclusively made by East Asian companies such as Japan’s Panasonic and their Chinese rival CATL. Between a quarter and two-fifth of the cost of manufacturing an EV comes from the cost of the battery. This is what defines the higher price point for the automakers and thus the battery costs are what needs to change.
A reduction in battery prices would also eliminate the need for hybrid electric vehicles. These cars have a combination of battery power and conventional combustion engine and this is normally done to keep costs down and within an acceptable range for consumer. If the battery cost comes down enough, there would be no need for this kind of model and would boost the switch to all-electric vehicles.
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