US$115 per kWh: electric car batteries have fallen in price to a record since 2017

According to BloombergNEF research, in 2024, the average price of electric vehicle batteries showed a record 20 per cent decline over the past seven years, to US$115 per kilowatt-hour of capacity. Increased production volumes, lower metal and component prices, and the ongoing shift to cheaper lithium-iron-phosphate batteries have contributed to the decline in battery prices.

Here's What We Know

The study's authors note that the faster-than-expected decline signals that electric and internal combustion engine vehicles could equalise in cost as early as 2026, when the average price falls below $100/kWh. This has already happened in China, where the average price of battery electric vehicles is lower than its petrol counterparts.

China is expected to produce enough battery cells in 2024 to meet 92 per cent of the total global demand of 1.2 terawatt hours for electric vehicles and stationary storage. However, battery makers are unlikely to produce excess cells for electric vehicles as global demand slows.

BNEF predicts, based on statistics since 2010, that battery prices will fall below US$100/kW⋅h in 2026 and reach US$69/kW⋅h in 2030. However, geopolitical changes add uncertainty to the future prospects of electric vehicle proliferation and, in turn, battery pricing.

Source: BNN Bloomberg