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As President Joe Biden and American automakers pledge to bring the number of zero-emission vehicles to half of all industry sales by 2030, a key challenge remains: persuading Americans that they can afford an electric vehicle, which has historically cost much more than conventional fuel. motor cars.
Experts say it’s no longer an impossible dream now that industry giants including Ford and GM are investing billions in electric vehicles, as the vehicle segment is called, driven by fierce competition with Tesla, BMW, Hyundai, Toyota, Honda, Volkswagen and others.
Electric, hybrid and plug-in hybrid vehicles made up 8.2% of all light vehicles sold in the United States in the first half of 2021, according to Wards Auto Intelligence. Electric vehicles accounted for 2.3% of these sales, hybrids 4.9% and plug-in hybrids 1%.
The goal is for prices to eventually fall below gasoline vehicles.
“No matter who has been in the White House, auto industry executives have seen the writing on the wall for quite some time when it comes to electrification and autonomous technologies,” said Jessica Caldwell, executive director from Industry Observer Edmunds Insights, in an emailed statement.
Automakers are sticking “to much more aggressive commitments and deadlines regardless of mandates or politics because they know how essential it is” to compete, Caldwell said.
The cheapest EVs on the market (including delivery costs) are a $ 30,750 Mini Cooper SE, a $ 32,620 Nissan Leaf and a $ 32,620 Hyundai Ioniq Electric, according to published Edmunds estimates. June 8. Prices include “destination charges”. or the amount charged for delivery. For high-end EVs, the Tesla Model 3 sells for $ 41,190, a Ford Mustang Mach-E $ 43,995, and a Tesla Model Y for $ 53,198.
A February chart from the industry publication Inside EVs shows a manufacturer’s suggested retail price range of 2022 of around $ 23,000 for a BMW Mini model to over $ 178,000 for a Porsche.
Hybrids are a bit cheaper, according to Edmunds. Hyundai’s Ioniq plug-in hybrid costs $ 27,705, Toyota’s Prius Prime $ 29,195, and Kia’s Niro plug-in hybrid costs $ 34,395.
A possible selling point for consumers? Reduced maintenance costs. The fuel savings of electric vehicles alone can reach over $ 4,700 in the first seven years of ownership, according to a recent analysis by Consumer Reports. With only 20 moving parts in an electric car, maintenance savings over the life of the vehicle can range from $ 6,000 to $ 10,000.
The $ 3,000 car
Even with the expiration of federal subsidies and other rebates for certain models of electric vehicles, prices are expected to drop sharply in the years to come. Don’t be surprised if prices end up dropping to $ 3,000 to $ 5,000 per vehicle, Morgan Stanley analysts wrote in a March note to investors, comparing combustion-engine cars to horses and strollers in the US. turn of the 20th century.
The last full year before Ford’s Model T revolutionized manufacturing with assembly line design, there were some 255 automakers and the average price for a car was $ 2,834, or roughly $ 80,000. in today’s dollars. Changes in the manufacture of electric vehicles equivalent to those of the Model T could lead to the same massive change, according to the investment bank, which is tracking the auto industry for investors.
“We would not be at all surprised to see the prices of many electric vehicles eventually drop below $ 5,000 per unit,” the analysts wrote, citing the January remarks of Shigenobu Nagamori, CEO of the Japanese electric motor maker. Nidec. Nagamori predicted an era when electric cars sell for around $ 3,000 and pointed to China’s existing electric vehicle for $ 4,300.
In June, GM increased its annual investment in electric and autonomous vehicles to $ 35 billion, from a target set last year at $ 27 billion. Ford is investing $ 30 billion in these technologies by 2025.
More money for infrastructure, like charging stations, could also make electric vehicles cheaper, analysts say.
“The changes we are seeing in the automotive system are the most significant in over 100 years,” said Jim Burkhard, who follows the oil, energy and mobility markets for IHS Markit, as electric vehicles gain traction. both the capital allocation and the regulatory battle, especially in Europe.
Still, he noted, around 10 million electric vehicles are in circulation today compared to 1.3 billion oil-powered vehicles.
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