A new report by Bloomberg New Energy Finance shows the cost of lithium ion batteries falling 14 percent over this time last year. Furthermore, prices took a 30 percent swan dive since 2009.
“Batteries are one of the biggest drivers of the cost of electric vehicles, and hence of their uptake. A sharp decline in price may be unwelcome for battery manufacturers, but it is essential for the long-term health of the sector,” Michael Liebreich, chief executive of Bloomberg New Energy Finance said.
The battery packs that go into EVs make up about 25 percent of the assembly cost, so a drop in the component’s price could be an indication that prices will fall on EVs soon too. Those costs are falling thanks to an oversupply of the material and lackluster demand for the actual cars.
Range-wary consumers who are reluctant to pay $35,200 for a Nissan Leaf when there are plenty of efficient alternatives as a lower initial cost are proving that electric cars will be a tough sell, though that might change if costs continue to decline and automakers are able to sell EVs for less.
