The main barrier to mass use of electric cars is their high cost, which should disappear by 2024, analysts suppose. When the price balance between EVs and cars with ICEs is established, a real battle for customers will begin in the market.
Electric vehicles will become more affordable in the near future
The cost of electric-powered cars will significantly reduce, according to Driving (British magazine), which refers to Deloitte’s (financial and analytical company) research.
One of the main factors to contribute in cutting costs for end-users will be reduction of technological expenses during production and government incentive programs.
The first is clear. Cheaper batteries are being developed. In China, for example, they reported of the first achievements.
As for incentives, the matter is not so easy. In the USA, in particular, federal tax credit of $7,500, on the contrary, will be abolished in a year.
Does the market need an extra 14 million electric cars?
For the entire 2018, around 2 million electric vehicles were sold worldwide. The volume of sales of gasoline and diesel cars has not been calculated yet, but it will exceed 80 million.
In 2020, 4 million EVs are expected to sell, by 2030 – 21 million. However, despite the boom in sales of hybrid and electric cars in the coming years, Deloitte experts believe that the EV market risks becoming unstable.
Based on the projected increase in production, it is estimated that the automotive industry will be able to produce 14 million more hybrid and pure electric vehicles than needed in the next decade. This means that supply can considerably outweigh consumer demand.
Electric cars are out of diapers
Recent developments show that in terms of their technical part, performance and dynamics, electric vehicles actually approach gasoline and diesel-powered cars. There are many examples: the Jaguar I-Pace, Audi e-tron, new Kias, Hyundais, BMWs. Mercedes-Benz presented its first production crossover; VW developed a separate platform for its all-electric cars. The list may go on.
In fact, green pickup trucks can really spur demand for EVs. There are prototypes not only from Tesla, but also from new companies, such as Rivian. GMC is going to develop its own electric pickup. The Ford F-150 gets a fully electric version, so General Motors won’t stand aside.
In short, the range is expanding, and the battle between electric and gasoline vehicles is possible soon, though 2024, in our opinion, is too early for a full-fledged rivalry.
Price remains EVs’ disadvantage
Speaking about pricing, currently gasoline and diesel models have nothing to fear. The cheapest Tesla Model 3, for example, costs from $44,000 in the U.S. The latest Toyota Corolla, for comparison, is priced at $18,700.
Well, the Corolla is not a premium class model. The new BMW 3 Series, if you wish, costs from $40,250 in the United States. With all due respect to Tesla, BMW is BMW, and it’s too early to talk about real rivalry between them today. Another thing – in 5 years…