Electric vehicles could match the price of gas-powered cars this year

by time news

This year in the United States, some electric cars could become “as cheap as or cheaper than cars with internal combustion engines,” the New York Times reports, citing figures from the International Council on Clean Transportation, a research and advocacy group. Prices are likely to continue on a downward trend as Tesla, General Motors, Ford Motor and their battery suppliers ramp up new factories, taking advantage of cost savings that come from mass production. New electric vehicles from companies like Volkswagen, Nissan and Hyundai will add to the competitive pressure… Falling prices for materials like lithium and cobalt have also helped. The price of lithium used in batteries has fallen 20% from its peak in November, although the metal is still more than twice as expensive as it was at the end of 2021. Cobalt has fallen by more than half since May, partly because lithium manufacturers cars are selling some models that do not require it, reducing demand. New lithium mines are starting to produce ore, which could keep a cap on prices…

As EV sales soar (rising 66% in the United States last year to 810,000, according to Kelley Blue Book), automakers are getting better at their manufacturing… Auto executives say they are discovering that it is easier and cheaper to design and build new electric models than gasoline ones. The battery cells made by Ultium, for example, are part of a collection of components that can be mixed and matched in many types of vehicles. Automakers have long used the same platforms across various models, but the strategy works even better with electric vehicles because the cars have far fewer parts than internal combustion vehicles. The Ultium platform cuts the time it takes to develop a new vehicle by almost two years, Dan Nicholson, GM’s vice president of electrification, said at a Federal Reserve Bank of Chicago conference in January. As a result, GM will be able to introduce three Chevrolet electric vehicles this year: the Equinox, a Silverado pickup and a Blazer SUV. “That’s how we get the economies of scale,” Nicholson said.

The article cites legislation passed last year to subsidize battery manufacturers, which “could reduce the cost of manufacturing electric vehicles by as much as $9,000,” as well as tax credits in the legislation for cars priced less than $55,000.

But in addition to making buying an electric car cheaper, “the car will require less maintenance,” the article notes, “and the electricity to power it will cost less than the gasoline used by its combustion engine equivalent.”

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