Falling raw material prices are making EVs more affordable

Shawn Knight

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Staff member
The big picture: Prices of raw materials required to manufacture electric vehicles have fallen steeply since January. The situation has perplexed some analysts that fully expected EV prices to remain high or even increase, effectively slowing the transition from combustion engines to those powered by electricity.

According to supply chain analyst Benchmark Minerals, the price of lithium used in EV batteries is down nearly 20 percent since January (as of March 20). Copper, which is found in both batteries and EV motors, has slipped roughly 18 percent during the same period. The price of cobalt, another core material in batteries, has been cut in half since the beginning of the year.

Savings are already trickling down to consumers. Tesla recently implemented its fifth price adjustment of 2023, lowering the price of its two most expensive EVs in an effort to make them accessible to more buyers. The Model S and Model S Plaid are $5,000 cheaper after the latest cuts. The Model X SUV, meanwhile, received an even larger $10,000 price cut.

Data from Kelley Blue Book reveals the average selling price of an EV in the US dropped by $1,000 from January to February.

"The desire for people to own a Tesla is extremely high," said Tesla CEO Elon Musk during the company's investor day earlier this month. "The limiting factor is their ability to pay for a Tesla," he added.

Others have echoed similar sentiments. Kang Sun, CEO of battery maker startup Amprius Technologies, told The New York Times that cost is the major roadblock right now for electric vehicles. Sun specifically mentioned lithium as a commodity that could drive new EV sales.

The cause of falling prices is up for debate. Some point to slowing sales growth in China and Europe after EV subsidies dried up. Others believe new mines and processing plants coming online are helping ease supply constraints of materials like lithium but if that is the case, it could work itself out in a timely fashion as demand for lithium is expected to increase 42-fold by 2050 to support a planned transition to clean energy.

Image credit: Charging by Andrew Roberts, Mine by Pixel

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Where? The price of the F-150 lightning went up, as did the rivian, ece. There is no sign of the $40k silverado EV, only the 78k+. And dont forget, most of these companies are still losing tremendous amounts of capital on these glorified go karts.
 
I haven't actually looked, but that doesn't sound right.

Demand is up for raw materials due to the push for EVs and prices are dropping? That doesn't sound right.....that can't be right. What kind of greedy corporations aren't taking full advantage of this?

Gorram twilight zone we're living in.
 
Reduced demand. There is also something of a mini-price war with EVs emerging. However, Chinese lithium prices still remain eight times the level of two years ago. This as a boondoggle for the manufactures, I don't see this ending well because the costs of retooling factories and low consumer demand for EVs. They simply aren't practical for most people as a main daily driver. I have contempt for anyone who buys an E-Truck, they can barely pull their own weight. "You're useless, Beatrice!
 
Need faster charging too. I see full gas stations at times weekly. With longer charging times, EVs either need much more stations or faster charging.
Also, not all states have enough electricity to charge all the cars if say 50% of gasoline cars became electric.
Politicians have a good way to solve it though, higher electric bill.
It would be amazing if someone found a simple and efficient way to produce hydrogen.
Imagine an affordable car that can be filled up as quickly as gasoline and with fuel costing much less than gasoline plus protected from price hikes.
I feel like there is a much greater replacement than gasoline be it hydrogen or another clean fuel.
 
:rolleyes: Heaven forbid - analysts are perplexed. Maybe they should go back to college and learn supply and demand and the effect of materials cost on the price of a product that uses those materials.
Where? The price of the F-150 lightning went up, as did the rivian, ece. There is no sign of the $40k silverado EV, only the 78k+. And dont forget, most of these companies are still losing tremendous amounts of capital on these glorified go karts.
Reduced demand. There is also something of a mini-price war with EVs emerging. However, Chinese lithium prices still remain eight times the level of two years ago. This as a boondoggle for the manufactures, I don't see this ending well because the costs of retooling factories and low consumer demand for EVs. They simply aren't practical for most people as a main daily driver. I have contempt for anyone who buys an E-Truck, they can barely pull their own weight. "You're useless, Beatrice!
The avalanche has started - it's too late for the pebbles to vote. "Kosh - Babylon 5"
 
Need faster charging too. I see full gas stations at times weekly. With longer charging times, EVs either need much more stations or faster charging.
Also, not all states have enough electricity to charge all the cars if say 50% of gasoline cars became electric.
Politicians have a good way to solve it though, higher electric bill.
It would be amazing if someone found a simple and efficient way to produce hydrogen.
Imagine an affordable car that can be filled up as quickly as gasoline and with fuel costing much less than gasoline plus protected from price hikes.
I feel like there is a much greater replacement than gasoline be it hydrogen or another clean fuel.
Faster charging isnt feasible at scale. What we have now already taxes local grids and has issues with slowdown. Going with faster charging is going to require major infrastructure. Your average substation is a 10 MWh facility, so 20 cars at 400 kWh is already loading it up to 80%.

What you need for EVs to truly be viable is larger batteries. EVs need to be able to go 600+ miles on a charge so you dont need to be constantly fast charging the things. Then you could use much slower dc fast charging rates overnight that are easier to manage (and stress the battery less).

Of course, this would require major revolutions in battery design, so good luck with that.
 
Can you imagine (USA pricing) what the price of these things would be, if taxpayers were not footing the
bill (government rebates).
 
Cheapest EV in NZ is an MG and some new Chinese upstart - about USD $26000- ie nearly double grandmas shopping car
 
If ev's were able to succeed in the marketplace they wouldnt need state mandates, which techspot loves to gleefully report on.

they do. ev's are inefficient and cannot succeed without government interference.

Data from Kelley Blue Book reveals the average selling price of an EV in the US dropped by $1,000 from January to February.

Yes, and you left out the price comparison to ICE vehicles, Strange! So the average EV now costs only 2X the average ICE, instead of 2.1?
 
Unless they are less than $5k without a shot battery I won't be affording one. I can buy a used 4cyl that gets 30+mpg for that around here still. There is barely going to be a market for used EVs with the batteries being worn out and too expensive to replace. This is just a terrible thing to do to people who refuse to go into debt for a vehicle.
 
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