Electric Cars to Reach Price Parity by 2025

  • Falling battery costs set to reshape the auto industry
  • Profit difficult in next three years, except for luxury cars

U.S. medium segment vehicle price estimates

Source: Bloomberg New Energy Finance
Note: Estimated pre-tax retail prices

Automakers planning to sell electric cars between now and 2020 will struggle to make a profit, as electric vehicles will cost up to a quarter more to manufacture than equivalent combustion vehicles, according to the latest analysis from Bloomberg New Energy Finance. This puts automakers in a difficult position since regulatory pressures require a quick ramp-up in EV sales starting around 2020. Falling battery costs will push EVs to price parity and beyond only between 2025 and 2029, depending on the segment. Premium brands such as Daimler, Audi and Volvo Car are introducing electric crossovers and electric SUVs by 2020, and may have more room to charge higher prices.

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