It's hard to get good numbers on this and I'm sure there is a good deal of variation among producers. There is also often confusion if the cost per kwh is for cells or batteries (batteries being packaged cells and costing more). A few quotes from car makers,
“Another executive, who declined to be identified because the company had not officially disclosed a figure, confirmed that Volkswagen was paying less than $100 per kilowatt hour for batteries.”- 9th Sept 2019"The firm claims that Tesla is on track to achieve “a battery cell cost of $100 per kWh by the end of the year.”- 11th Sept 2019A few points,
* I suspect it will go a lot quicker than forecast with all the competition. A will also add that Bloomberg New Energy Finance (BNEF) and many others have an absolutely woeful history for forecasting this quantity.
- In 2016 when the cost was newar US$300/kwh, BNEF projected US$120/kwh by 2030.
- In 2017, when costs dropped to US$209/kwh, BNEF claimed price parity in 2025.
- Now, with costs at US$156/kwh, they are claiming 2023-2024.
I'm even suspect about their average cost in light of the statements out of the big car makers. There will be some distribution of costs across the battery production sector and the average likely doesn't have much of a future.
* Purchase price parity with ICE would be on top of big, longer term cost savings due to fueling and maintenance.
* The valuation analysts at Kelley Blue Book reported the estimated average transaction price for a light vehicle in the United States was $37,185 in May 2019. This has been going up each year for a few years now. The most basic stock Model 3 sits at around US$40,000 and craps all over the 'average' ICE vehicle. The average margin for an ICE automaker in the US is a mere 6% and this is for much bigger production volumes than Tesla and the like. So parity isn't far off especially as EV production volumes increase.
* Importantly, I suspect the mantra of '
the $100 per kWh figure has emerged as the key measure to bring EV prices on par with combustion' is far too simplistic today. It was valid when battery costs were significantly higher just a few years back and dominated manufacturing costs but today, you can get significant cost saving in other parts of the production process in EVs like the VW MEB platform.
Either way, ICE vehicles are utterly doomed in the not to distant future. Projections are for battery costs to come down eventually to below US$50/kwh.
(20min delay)