Price parity is seen as one of the major milestones electric vehicles have to pass in their quest to take over the automotive world. A study from BloombergNEF, reported by The Guardian, suggests that, in Europe at least, this could happen as early as 2027.
In fact, larger vehicles, like SUVs and crossovers, are expected to start costing consumers less than their gas-powered counterparts by 2026. Smaller vehicles, like hatchbacks, will only start matching their gassy counterparts the following year.
By 2030, the average electric car is expected to actually cost less than an ICE-powered one, and that’s before you even consider tax incentives.
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The changeover is expected to occur because of investments automakers are making in EV production. As more and more assembly lines become dedicated to EVs, economies of scale will bring down their prices.
BloombergNEF anticipates that by 2026, the average price of a mid-size vehicle will be €19,000 ($23,090 USD), whether it’s being propelled by petrol or electrons. By 2030, it predicts that the average price of an EV will be €16,300 ($19,809 USD), while the average ICE vehicle’s price will have risen slightly to €19,900 ($24,184 USD).
That’s a marked change from today’s price gulf of €33,300 ($40,469 USD) for an EV to €18,600 for an ICE car ($22,604 USD). But BloombergNEF is actually one of the more conservative forecasts, The Guardian states. Investment bank UBS predicts that cost parity will actually be achieved in 2024.
Either way, everyone agrees that the prices of batteries, the single costliest component (both in dollars and carbon) in EVs, are coming down quickly.
A study commissioned by Transport & Environment, a non-profit organization that campaigns for cleaner transport in Europe, predicts that battery prices will fall by 58 percent in the next decade. That could bring their price down to $58 per kWh, lower than the $100/kWh that is considered by many to be another major milestone in EV adoption.
