A report has emerged showing that electric vehicle battery prices are falling faster than expected.
Automotive media outlet Electrec reported this on the 20th (local time), citing a report from global investment bank Goldman Sachs.
According to the report, the price of electric vehicle batteries recently continued to decline until 2021, but turned to an upward trend over the past few years as prices rose due to a surge in the price of some raw materials and inflation.
Goldman Sachs updated its future battery price forecast report and said that battery prices have begun to fall again. “We expect battery prices to fall to $99 per kilowatt-hour (kWh) by 2025. “This is a 40% decline from 2022,” he explained. “We estimate that almost half of the decline is due to the decline in the prices of electric vehicle raw materials such as lithium, nickel, and cobalt.”
Nikhil Bhandari, an analyst at Goldman Sachs, added, “We expect battery pack prices to decline by an average of 11% per year from 2023 to 2030.”
The battery price estimated by Goldman Sachs is the price of the battery pack, not the battery cell. Electric vehicle batteries are generally manufactured through the ‘Cell-Module-Mac’ process.
Because automobile manufacturers use various methods to produce battery packs, actual electric vehicle battery prices may vary. Because of this, some manufacturers may already be paying much lower or even higher than the currently reported $140 per kWh level.
However, if battery prices drop to an average of $100 per kWh within the next two years, it is expected to have a significant impact on the entire industry.
“Reductions in battery costs could lead to more competitive electric vehicle pricing, broader consumer adoption, and further growth in the electric vehicle and battery markets,” said analyst Nikhil Bhandari.