Auto Express

Electric vehicle sales remain strong despite rising battery costs



Buyers around the world are lining up to buy tram this year, even with sticker prices skyrocketing, overturning the conventional auto industry’s decade and a half scenario that electric vehicle sales only skyrocketed after the battery the cost of falling below the threshold is always above the limit.

This year, demand for electric vehicles remains strong even as the average cost of lithium-ion battery cells rose to an estimated $160 per kilowatt-hour in the first quarter from $105 last year. Costs increased due to supply chain disruptions, sanctions on Russian metals and investor speculation.

For a smaller car like Hongguang Mini, the best selling EV in Chinahigher battery costs add up to almost $1,500, which is 30% of the sticker price.

But gasoline and diesel oil Fuel costs for internal combustion vehicles have also skyrocketed since Russia’s invasion of Ukraine, and experts note that environmental concerns are also driving many buyers to opt for electric vehicles despite the volatile economy.

Manufacturers from Tesla SAIC-GM-Wuling, the company that makes the Hongguang Mini, has passed on higher costs to consumers with double-digit price increases for electric vehicles.

More is likely to come. Andy Palmer, president of EV battery maker Slovak InoBat, said margins in the battery industry have been thin, so “increasing costs will have to be passed on to automakers.”

Vehicle manufacturers such as Mercedes-Benz will likely pass the increase on to customers if their raw material prices continue to rise. “We need to stay profitable,” Chief Technology Officer Markus Schaefer told Reuters.

But electric car shoppers have so far not been deterred. Global electric vehicle sales in the first quarter rose nearly 120%, EV-volumes.com estimates. China’s Nio, Xpeng and Li Auto posted record EV sales in March. Tesla posted a record 310,000 EVs in the first quarter.

‘Different types of tipping points’

“There is another type of tipping point that we seem to have hit – the point of hitting,” said Venkat Srinivasan, director of the Center for Energy Storage Science Collaboration at the US government’s Argonne National Laboratory in Chicago. emotional or psychological limitations in consumers. He said “more and more people” will buy electric vehicles “regardless of the cost of the battery and the vehicle.”

This spike in battery costs could be a bright spot in a long-term trend in which increasing manufacturing and technological innovation has pushed costs down for three consecutive decades. Industry data shows that the average cost of $105 per kilowatt-hour in 2021 has fallen by almost 99% from more than $7,500 in 1991.

Experts say battery costs could continue to rise over the next year or so, but after that, another big drop is likely to follow as automakers and suppliers invest heavily in mining, refining and battery production, and the move to diversify sources of raw materials, shifting the balance from shortage to surplus.

“It’s like a bubble – and let that bubble settle, at least until the end of 2023,” said consultant Prabhakar Patil, former LG Chem executive.

British battery maker Britishvolt expects to start making batteries at its 45 gigawatt-hours plant in north-east England by 2024. Chief strategy officer Isobel Sheldon said the advice the company has received from suppliers The raw material supplier is “don’t fix your price now, wait 12 months and fix it then because things will get more and more even. ”

“The over-security of this resource will have consequences after us,” she said.

Bridge over supply

The industry has long awaited the $100-per-kilowatt hour battery cost threshold, as a signal that EVs have reached parity with fossil fuel equivalents. But with gasoline prices soaring and consumer preferences changing, that may no longer matter, analysts say.

Stan Whittingham, co-inventor of the lithium-ion battery and a 2019 Nobel laureate, said demand for electric vehicles in China and other markets “is growing faster than people think – faster than supply.” material”.

Chris Burns, chief executive officer of Novonix, a Halifax-based supplier of battery materials, said environmental and climate concerns also spur buyers, especially young people, to choose electric vehicles instead of fossil fuel vehicles.

“Many young people entering the market are making buying decisions beyond simple economics and are saying they will just drive an EV because they are better for the planet,” says Burns. “They are going downhill even though it would be cheaper” to drive a car that runs on gasoline.

“I don’t think we’re going to stop seeing reports that try to trend the price of batteries down to $60 or $80 a kilowatt-hour, but it’s possible that those things may never happen,” he said. Okay”. “However, that does not mean that electric vehicle adoption will not increase.”

Reporting by Paul Lienert in Detroit and Nick Carey in London; Editing by David Gregorio



Source link

news7h

News7h: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, Sports...at the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button