The high cost of electric cars is due to soon tumble, with prices in Europe expected to be directly comparable to traditional petrol or diesel vehicles as early as next year.
Currently, electric cars are criticised for being much more expensive than regular cars, with some up to twice the price of an equivalent petrol or diesel, limiting their competitiveness.
However, a report from financial services company UBS claims that prices could draw level much quicker than anticipated, which could send the number of electric cars on the roads skyrocketing.
The report states that UBS bought a new Chevrolet Bolt, regarded as the first true mass-market electric vehicle, and then dismantled it to better understand the economics of its inner workings.
It said: “We found that the EV powertrain is $4,600 cheaper to produce than we thought and there is more cost reduction potential left.
“Consumer cost of ownership parity vis-a-vis combustion engine (ICE – internal combustion engine) cars can be reached from 2018 first in Europe, creating an inflexion point for demand.”
Furthermore, the UBS report predicts that the cost of electric vehicles versus regular cars will level out in China by 2023 and in the US by 2025.
UBS’ report also tempered expectations that the new Tesla Model 3 will usher in an era of cheaper electric motoring, claiming that the company hasn’t yet hit the right proportion of economy of scale.
Instead, it claimed that vehicles like the upcoming Audi e-tron Quattro and Jaguar I-PACE will have a greater effect, given that they’re products from already well-established manufacturers.
