If you've been avoiding making the change to an electric vehicle due to the high cost of a new EV, then you may be in luck. New projections are pointing toward a shift in the price of battery-powered vehicles that can make automakers more money and lower the cost of ownership, according to Inside EVs.
A study from Kelley Blue Book found that the average price for a new EV is about $7,000 more than the price of the average new car of any type. With Inflation Reduction Act point-of-sale rebates of up to $7,500, though, that figure is more or less nullified, though some popular EV models remain a notch or two more expensive than otherwise-similar gas-powered cars even after that rebate.
One of the major hurdles to the price of EVs has traditionally been the cost of lithium-ion batteries, which are widely used as the power source for electric vehicles.Â
"In any vehicle, the power plant is the most expensive part of the product, and that's driven by the raw materials, the refining, the amount of energy, and the precision that's required in creating a battery cell and in creating battery packs," said Carla Bailo, CEO of the Center for Automotive Research.
According to the U.S. Department of Energy, the price of lithium-ion batteries has gone down nearly 90% since 2008. With the price of lithium decreasing rapidly, automakers can lower the outright cost of their vehicles and make more money.
Estimates show that there will be a high spike in the supply of lithium, which would lower the cost of the mineral for the production of EVs. Projections estimate that EVs could cost the same as gas-powered cars by 2029.
Electric vehicles, which reduce air pollution and decrease demand for dirty energy sources like fuel, have been an attractive offer for drivers. However, the high ticket price has turned potential buyers away. A study from S&P Global found that half of those surveyed think EV prices are too high.
However, plenty of options make the price of ownership of an EV more affordable, such as the U.S. government tax incentives that can save up to $7,500 on the price of an EV.
Beyond that, without having to pay for fueling costs, drivers can save over $1,200 a year with EVs. And charging systems are becoming more efficient, which can help save drivers money and time. With cheaper electric vehicle options on the market as well, drivers can look forward to more EVs on the road.
"Sticker price is the key to more sales," one commenter said. "It's a matter of time."
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