The ongoing, industry-wide shift to electrification has had a profound impact on the way in which new electric vehicles are engineered and produced, with automakers working to reduce costs and streamline processes whenever possible. One of the most important pieces of the puzzle is the battery, which is often the most important and expensive component of an EV. Unsurprisingly, the cost for a new vehicle lithium-ion battery has fallen dramatically in the last 15 years.
According to a report from the U.S. Department of Energy (DOE), the average cost for a light-duty vehicle lithium-ion battery pack decreased by a whopping 90 percent between 2008 and 2023. The estimate is based on 2023 constant dollars and looks at the dollars per kWh of usable energy for production at scale of at least 100,000 units per year, which was recorded at $1,415 per kWh in 2008, falling to just $139 per kWh in 2023. The DOE points to improvements in battery technologies and battery chemistries, plus improved manufacturing and increases in production volume.
Looking at the DOE chart, we see a dramatic fall in costs between 2008 and 2013, after which the decline starts to level out. The sources for the study include previous DOE reports, as well as a report from the National Academies of Sciences, Engineering, and Medicine.
Courtesy Department of Energy
Production of GM’s 21st-century volume all-electric and PHEV platforms began with the Chevy Volt in 2010, followed by the GM BEV2 platform in 2016, the GM BT1 platform in 2021, and the GM BEV3 platform in 2022.
A recent study indicates that prices for used all-electric models are nosediving, and that the average price for an electric vehicle is now lower than the average cost for a Tesla. Nevertheless, cost remains a primary boundary to widespread adoption of all-electric vehicles.
Looking ahead, GM says the next-generation 2026 Chevy Bolt will be the most affordable all-electric vehicle in the U.S. The new Bolt will be based on the first-generation Bolt EUV and will incorporate new lithium iron phosphate (LFP) battery technology.
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Comments
and yet people are not seeing afforble prices!
What are you talking about? There are insane EV deals everywhere you look. I turned down an offer for $199/month with $5k down for 24 months on an Equinox EV. That’s $0.49 per mile. Factor in fuel and maintenance savings on top of that. I ended up pulling the trigger on a Mach-E, 36 months, 22500 miles, for $366 per month all in with tax and title and no down payment. That’s $0.58 per mile. Was $16750 off MSRP. Quit making fake/uninformed arguments.
I too am seeing great deals on EV leases right now. Demand has slackened and dealers have way too many EV units on their lots. These cars are being leased at deep discounts, and both dealers and manufacturers are taking a bath on them. They are priced way below cost. This is a temporary state and will not last long, so lease now if you want to try out an EV for a few years.
Yup, old stock being cleared out. These batteries slowly lose their energy while sitting on a lot, so ‘lot rot’ is an even bigger problem for EVs than they are for ICE vehicles.
Is that a lease?
Yes, the lease deals are out of this world. Few reasons for this. 1) ineligible manufacturers can pass a $7500 credit on a lease but can’t do so on a purchase, 2) they are able to play lots of games on residuals, implied interest and rebates so they can maintain their nominal MSRPs. A much more sophisticated tactic versus the blunt force Elon does with moving the price on Tesla’s every month. But the notion that EVs are unaffordable right now is outright ignorant. Ignore the MSRPs and look at true transaction prices and embedded prices on leases. These are generational deals being offered right now.
Right! Part of the problem is production volume. With the exception of Tesla, all others selling EVs in the U.S. are not yet selling sufficient volume to gain the economies of scale to lower prices to their desired levels, for both producers and consumers. Once EV models are selling at 100,000 units or more per year we will see how affordable they really can be.
Would be interesting to get an update from GM on their Ultium pack costs. Last I saw, they were saying under $100/kwh by 2025.
They are dreaming. We’ve had this convo. Costco is now offering a home battery 18kwh on sale for 8 grand. Normal price is 9. Whoa, 500/KWh normal 444 on sale. Granted retail, but in the end retail includes those little things like profit, cost of returns from defects etc. And please don’t tell me batteries never get made that don’t get recalled.
It also includes the BMS, packaging, connections, etc. The price here is for the cells only.
Home batteries are not being manufactured on the scale of automotive batteries.
And GM through Ultium has mostly vertically integrated it’s battery production.
Not a very valid comparison.
Similar reasons why a Touring Harley Davidson costs more than a Chevrolet Equinox.
yet msrps have gone up 90% since 2008
get fleeced!