[RahulNagaraj]

While the shift towards electric mobility is rapidly gaining momentum, EVs even today have a higher sticker price than their conventional IC-engine counterparts.



However, according to a new forecast, this could change very soon. A new report by BloombergNEF states that by 2027, the price of electric vehicles could be less than that of IC-engine cars. Further to this, the tightening of emission standards on IC-engine vehicles will allow EVs to take over all new car sales by the next decade.



Reports suggest that prices of electric sedans and SUVs will become equal to, if not lower than their petrol / diesel-powered counterparts by 2026, while smaller cars will reach the threshold the following year. This is before the application of any government-approved subsidies for EVs.



The reason for the price parity between EVs and IC-engine cars is said to be due to the falling production costs of batteries. Reports suggest that the reduction in battery cost to below US $100 per kWh will be an important step towards faster adoption of fully electric vehicles. This could also remove the current financial appeal of hybrid electric vehicles.

In line with this, a new study by Transport & Environment (a Brussels-based non-profit organisation), predicts that the prices of new batteries will fall by 58% between 2020 and 2030, to US $58 per kWh.



Reports also suggest that the reduced battery costs, combined with increased range, will make the switch to EVs a 'no-brainer'.

Source: TheGuardian

Link to Team-BHP news

[dailydriver]

2027 is too soon to achieve this.

But in general, Electric vehicles will only be considered as viable and reliable alternatives to fossil fuel powered examples if they retail at the same / similar price points as their IC qualitative and quantitative equivalents.

And of course, reducing the cost of the battery is the single most important factor in achieving this price parity. Ergo, it wouldn't be wrong to say that the word could in the title needs to be replaced by would.

[turbo]

In the US and Europe, maybe.

But then the cheapest EV in the USA is the Mini Cooper EV, costing $ 29,990. Which is just a couple of thousand more than a standard Mini.

In India, the cheapest car costs $3500 (alto). There's no way EVs are going to be cheaper than that in the next two decades.

[Equus]

It has already began in China with a $4500 mini ($500 more for AC)!

The Hong Guang Mini EV saw sales of 112,000 for the second half of 2020, ranking second behind Tesla's Model 3 which are made in its Shanghai factory.

https://www.bbc.com/news/business-56178802

[GTO]

I totally buy that electric cars will be cheaper than petrol / diesel cars one day. No engine, no turbo-charger, no gearbox, no BS6-compliance DPFs + cat-cons + SCR systems, vastly lesser moving parts, substantially simpler drivetrains & supporting systems. Plus, once China starts mass-producing batteries & motors, you know what happens to part prices.

But I don't think it'll happen by 2027. My guess is more like 2035 types.

[speedmiester]

This is a trend that would put EVs on most consumers radar. By 2027, there will be enough battery tech breakthroughs to enable us to travel farther and charge quicker.

Originally Posted by turbo

In the US and Europe, maybe.

But then the cheapest EV in the USA is the Mini Cooper EV, costing $ 29,990. Which is just a couple of thousand more than a standard Mini.

In India, the cheapest car costs $3500 (alto). There's no way EVs are going to be cheaper than that in the next two decades.

That is not an apple to apple comparision.
Compare a Nexon Diesel or Petrol one with it's EV counterpart, the difference today stands at around 3-4L between comparable variants of Nexon. This price gap will narrow over the next few years.

[Mad Max]

There were some reports around the e-waste electric vehicles would create in the long run. What is Team-BHP's perspective on this?

[Tucker48]

Originally Posted by turbo

In the US and Europe, maybe.

But then the cheapest EV in the USA is the Mini Cooper EV, costing $ 29,990. Which is just a couple of thousand more than a standard Mini.

In India, the cheapest car costs $3500 (alto). There's no way EVs are going to be cheaper than that in the next two decades.

Mini Cooper is not the cheapest car in the USA. So the comparison doesn't hold true in any parameter. Also, alto is likely to cost considerably more by 2026-27 as I expect the govt to make some more safety norms mandatory in near future.

Price parity by 2026-27 without govt incentives is what this article states. Going by OTR, it might be achieved by 2025 if the taxes on EVs are not increased. Economy of scale will help the manufacturers to bring that price parity even before the said timeline like what Ola is doing with 2 wheelers. As EVs have less components as compared to fossil fuel vehicles, it's quite possible to have everything in house which increases efficiency thus saving costs.

My take is that the EVs on sale in India by 2025 will be priced(OTR) similar to their ICE counterparts provided the govt doesn't increase taxes or add another 1-3 years if the govt does increase the taxes(which is most likely to happen).

[gkveda]

Technically, a EV Car may cost lot lesser than ICE cars. But will the car manufacturers allow that benefit to the customers? Per my knowledge, their business greed will not allow even one single rupee benefit to be passed on to customer.

The way a car manufacturer would think is, Anyways, if it was ICE car, customer would be willing to pay X Amount. The car that I am offering has all the features that an ICE Car would have. So, why should I reduce the price?

So, if we see real world price, just for an eyewash, they will reduce some 10-15k initially and bring back the price to normal

[GutsyGibbon]

Originally Posted by Mad Max

There were some reports around the e-waste electric vehicles would create in the long run. What is Team-BHP's perspective on this?

I cannot speak for Team-bhp, but this is my perspective. The equation gets very complex with all the waste of oil spills, oil exploration, oil transport, and the emission that is all over our cities. Then the added costs of treating respiratory illness caused by emissions/pollution that is borne by the country. Look around - how many seniors have breathing issues in our cities, and look at occurrence of breathing issues in seniors on a remote pacific island with few/no cars.

A pivot to green energy, and EVs would be a winner, but needs sound policy, and long term vision. The recycling of EV batteries can be part of energy banks to store energy for peak hours in a smart grid.

[landcruiser123]

With EVs, you are pre-paying for fuels (in the form of chemical battery) and the electricity serves as a catalyst to re-use the fuel(i.e. battery).

Maybe some premium high-end EVs might cost less than their car gas counterparts, but doubt a Toyota Corolla or a Honda Fit (Jazz) would have a cheaper EV equivalent by 2027. My guess is 2040.

[kushagra452]

My thoughts are as follows:

1. With crude expected to be north of $250 in the coming decade, the EV adoption rate in India is bound to grow exponentially. It will simply not be economically viable to own a IC engine car for a vast majority of Indians.

2. We're presently at the start of the next commodity super cycle and have seen all commodities - soft and hard, multiplying over the past few months. Hence, the cost of manufacturing a car is only going to go up. Inflation figures put out by the GoI will surely be revised upwards. Don't be surprised if you see the humble Alto retailing at close to a Million INR this decade.

3. Combine this with crude and natural gas at unforeseen levels, car ownership is going to see a tectonic shift. Even driving a CNG car will cost North of Rs.10-12/ kms in the coming years.

4. EVs in India will never be cheap. Considering that the GoI sees basic mobility as "luxury", the EVs will be subject to a plethora of taxes and duties.

5. EV infra (charging stations, battery disposal facilities etc.) will lag the EV adoption rate and will be a bottleneck in accelerating EV adoption.

6. In conclusion, owning, driving and maintaining a car in India is going to get obscenely expensive in the near future. On a PPP basis, India might just top the list by 2030.

[maddy42]

Originally Posted by kushagra452

My thoughts are as follows:

1. With crude expected to be north of $250 in the coming decade, the EV adoption rate in India is bound to grow exponentially. It will simply not be economically viable to own a IC engine car for a vast majority of Indians.

2. We're presently at the start of the next commodity super cycle and have seen all commodities - soft and hard, multiplying over the past few months. Hence, the cost of manufacturing a car is only going to go up. Inflation figures put out by the GoI will surely be revised upwards. Don't be surprised if you see the humble Alto retailing at close to a Million INR this decade.

3. Combine this with crude and natural gas at unforeseen levels, car ownership is going to see a tectonic shift. Even driving a CNG car will cost North of Rs.10-12/ kms in the coming years.

6. In conclusion, owning, driving and maintaining a car in India is going to get obscenely expensive in the near future. On a PPP basis, India might just top the list by 2030.

These points in addition to EVs getting cheaper will lay the carpet out for EVs. Few additional points.

My cousins husband works in Oil and Gas in a allied servies space His firm CEO has already spelt it out that having a job after 2030 will become harder with a lot of countries outright banning IC engines and also the demand for oil dropping. The big guys are already noticing and you will see how companies invest in the next decade.

The govt here is making owning a older second car harder with the 15 year rule. If the EV plan turns out the way its specified in this article then it is outright a gloom and doom. If you are in your 30s, there will be a time in your life where you may not have a IC engine vehicle in your garage.

Maddy

[Bhargav7]

Originally Posted by gkveda

Technically, a EV Car may cost lot lesser than ICE cars. But will the car manufacturers allow that benefit to the customers? Per my knowledge, their business greed will not allow even one single rupee benefit to be passed on to customer.

In the short-run - yes. The manufacturers may getaway by having high sticker prices and making super-profits.

But over the long run, they have to pass on the benefit to the customer. Else, competition will put them out of business.

[Memnon]

I have some doubts regarding Electric Vehicles.
Even if everyone switches to electric vehicles, the electricity continues to be generated in India through coal and other such sources which harm the environment.
So, as far as I understand, instead of each individual burning fossil fuels in their cars, the government will increase energy production by burning more coal in the power stations.
Ofcourse there will be other issues like disposal of batteries etc which could also pose challenges.
So at the end of the day is this shift to electric vehicles really going to help the environment? What am I missing?