EVs to reach cost parity with ICE cars by 2024 - new UBS analysis
Thu 22 October 2020
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New analysis from global financial services firm UBS finds that electric cars will be no more expensive to make than conventional cars with internal combustion engines (ICE) by 2024. By the middle of the 2020s a UBS analyst says there will be few reasons left to buy an ICE car.
The research is by UBS Evidence Lab, a team working across 55 specialized 'labs' creating insight-ready datasets. The group holds a library of assets, covering over 5000+ companies of all sizes, across all sectors and regions and is designed to help investors answer key questions about the future direction of markets. This study is based on detailed analysis of batteries from the seven largest manufacturers.
The study (reported by The Guardian) says that the extra cost of manufacturing battery electric cars versus their fossil fuel equivalents will diminish to just $1,900 (£1,470) per car by 2022, and disappear completely by 2024,
A key element of the analysis is based on expected battery costs, forecast to drop to below $100 per kilowatt hour (kWh), by 2022.
UBS says that those carmakers that try to hang on to ICE sales risk being left behind by rivals such as Tesla and Volkswagen, the world’s largest carmaker by volume, which has committed to investing €33bn in selling electric cars.
Tim Bush, a UBS analyst said that he believes that the reduction in battery costs would also largely eliminate the financial case for hybrid electric vehicles, which combine a battery with a conventional engine.
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