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Battery prices have dropped 10x over the last decade. Batteries were north of $1,000 per kWh in 2010. They’re approaching $100 now. It’s not unreasonable to expect the price to fall to $10 to $20 in the next decade.
But the manufacturers won't sell YOU the batteries that cheap. They want to force you to buy a new car. It's the same reason dealers quote crazy prices like $7k for a four cylinder ICE.
This is ridiculous. Batteries and vehicles are expensive because the material needed are expensive, and the construction and labor cost are high. The manufacturer is not going to build any product, including a battery, to sell it at a lower cost than what it takes to produce it.
Apparently, the current administration in Washington DC, along with majorities in Congress, never got the memo.
After years of planning, China now dominates the world’s production of new generation batteries that are key to transitioning away from fossil fuels. These new batteries are essential for electric vehicles and most portable consumer electronics such as cell phones and laptops....
[EVs] will likely use Chinese batteries, a key element for transitioning away from fossil fuels, and most of those batteries will be lithium ion, which are also popular for cellphones and laptops because of their high energy per unit mass relative to other electrical energy storage systems, according to the U.S. Department of Energy.
“Looking at the global automotive industry chain, China, for the first time, has taken the lead in the world in the manufacturing of key parts," state media Xinhua said in August in a report titled "China's dominant position in batteries needs to be further consolidated."
I suspect China views the shift from IC to EV as a strategic lever to ensure Chinese auto brands always have a competitive advantage, with the goal of dominating all vehicle manufacturing worldwide. China would be very happy to force GM, Ford, Stellantis, Toyota, Daimler, etc into being small, niche players (or out of business entirely) being replaced worldwide by major Chinese companies.
But the manufacturers won't sell YOU the batteries that cheap. They want to force you to buy a new car. It's the same reason dealers quote crazy prices like $7k for a four cylinder ICE.
True, at least thus far.
Elon has made a lot of noise about Teslas being million mile cars, but they're only million mile cars if there are replacement parts for the consumable items. Which at a million miles the batteries and probably the electric motors are consumables. As with all things Elon, I assume he's lying about it unless and until I see it. At least for right now there's no economic incentive to having any battery replacement program. They can sell as many cars as they can produce batteries, so replacement batteries just means lost car sales. Unless they make more money selling the battery than the car, why sell batteries? They did do a replacement/upgrade for Roaster 2.0, but honestly it was a complete eff up with people waiting a year or more to actually get the batteries. Otherwise it's one-offs. You might be able to get a battery out of warranty for physical damage but it could take excessively long and will be very expensive. That and just Tesla is terrible about any kind of repair or replacement parts for any reason.
My take is especially Tesla even more than anyone else will only offer economically viable replacement parts for consumable items in response to competition. The traditional automakers would all prefer disposable cars, so I wouldn't expect it to come from them. Some of the upstarts, especially Canoo, make similar Elon-like noises... but they're upstarts. More likelihood of them following through than Tesla but remains to be seen. For now EVs should be treated as more disposable than ICE vehicles. You can probably get around 15 years with a typical ICE vehicle before they're not worth dumping money into anymore.
E.g., it's $16,000 to exchange a battery on a Model 3 for another used battery. None of them are old enough even a broken battery isn't worth quite a lot still. Most of the modules are probably still fine and can be cannibalized. Probably closer to $20k for a used Model 3 battery, depending on the core deposit. If you've got a fairly new $50,000 Model 3, probably worth $16,000 to exchange a non-functioning battery. It's probably either an insurance claim or warranty claim anyway, unless you went in and tinkered with it or something. But it's not worth $16,000 to exchange a battery on 10-year-old Model 3 for a 10-year-old battery that works. Crush the car and buy a new one.
That's where the Model S is today. Maybe some cottage industry will pop up to put the 95/100 kwh packs in a 65 or 85 kwh Tesla. There's some companies that do that with the Leaf, although once again, it's just taking used batteries from totaled cars and putting them in the older ones. Kind of a long shot that an unauthorized third-party shop will ever be able to fit the newer 4680 cell packs into a the older Teslas.
Now, the Chinese are already reporting under $100/kWh for e-buses, but how much can we trust their reporting? I don't know.
At $126/kWh even the Bolt's battery pack costs GM ~$7500. And that's for a pack that goes 300 miles on a charge.
But according to BloombergNEF, the 2023 version will be under $100/kWh for an ever cheaper battery that goes a few more miles of range. And that sort of cost is industry wide, not just GM.
Elon has made a lot of noise about Teslas being million mile cars, but they're only million mile cars if there are replacement parts for the consumable items. Which at a million miles the batteries and probably the electric motors are consumables. As with all things Elon, I assume he's lying about it unless and until I see it. At least for right now there's no economic incentive to having any battery replacement program. They can sell as many cars as they can produce batteries, so replacement batteries just means lost car sales. Unless they make more money selling the battery than the car, why sell batteries? They did do a replacement/upgrade for Roaster 2.0, but honestly it was a complete eff up with people waiting a year or more to actually get the batteries. Otherwise it's one-offs. You might be able to get a battery out of warranty for physical damage but it could take excessively long and will be very expensive. That and just Tesla is terrible about any kind of repair or replacement parts for any reason.
My take is especially Tesla even more than anyone else will only offer economically viable replacement parts for consumable items in response to competition. The traditional automakers would all prefer disposable cars, so I wouldn't expect it to come from them. Some of the upstarts, especially Canoo, make similar Elon-like noises... but they're upstarts. More likelihood of them following through than Tesla but remains to be seen. For now EVs should be treated as more disposable than ICE vehicles. You can probably get around 15 years with a typical ICE vehicle before they're not worth dumping money into anymore.
E.g., it's $16,000 to exchange a battery on a Model 3 for another used battery. None of them are old enough even a broken battery isn't worth quite a lot still. Most of the modules are probably still fine and can be cannibalized. Probably closer to $20k for a used Model 3 battery, depending on the core deposit. If you've got a fairly new $50,000 Model 3, probably worth $16,000 to exchange a non-functioning battery. It's probably either an insurance claim or warranty claim anyway, unless you went in and tinkered with it or something. But it's not worth $16,000 to exchange a battery on 10-year-old Model 3 for a 10-year-old battery that works. Crush the car and buy a new one.
That's where the Model S is today. Maybe some cottage industry will pop up to put the 95/100 kwh packs in a 65 or 85 kwh Tesla. There's some companies that do that with the Leaf, although once again, it's just taking used batteries from totaled cars and putting them in the older ones. Kind of a long shot that an unauthorized third-party shop will ever be able to fit the newer 4680 cell packs into a the older Teslas.
There's going to have to be a way for the aftermarket to sell the batteries. The big question is, will the auto manufacturers make it extremely difficult for that to happen? Will they try to their best to "lock out" any aftermarket battery in an attempt to force people to use dealer service depts?
There's going to have to be a way for the aftermarket to sell the batteries. The big question is, will the auto manufacturers make it extremely difficult for that to happen? Will they try to their best to "lock out" any aftermarket battery in an attempt to force people to use dealer service depts?
I wouldn't be surprised if they did--they are after all looking at the possibility of other maintenance costs going down if there's a switch to EVs, so there are probably more than a few bean counters among the major automakers pushing to make it harder (and therefore more costly) to do an aftermarket conversion.
There are 3rd parties who replace batteries and of course the EV conversion crowd. It'll remain to be seen how competitive that gets in reducing down the price for battery replacements. Right now, it seems like there needs to be more suppliers and a larger overall market which greater EV adoption rates would supposedly help make happen.
Solid state batteries will still need metals, including conductors, and plastics. The main difference is that there are using solid electrodes and electrolytes. The saying that, "there is not such a thing as a free lunch" is true. There are several government programs that offer deductions for buying energy efficient and "green technology" products. But the tax and other monetary incentives don't grow on trees. It comes from the tax payers. https://en.wikipedia.org/wiki/Solid-state_battery
Batteries, motors, engines, catalytic convertors, inverters, electricity, gasoline, etc. all of these aren't going to be free in any real sense. I don't think anyone is claiming they will be free. The difference for solid state versus current batteries in regard to the market place is the possibility of even less material used per kWh, faster charging speeds without damage to battery, and greater longevity. If you use fewer materials in weight, volume, and cost (which are linked) for the same amount of utility value, then it usually means a more competitive product.
We are seeing battery improvements making electric vehicles more cost competitive with their closest ICE counterparts. Tesla and GM have already sunset out of the federal tax credit and are still competitive with their EVs compared to ICE vehicles in the same segment. I suspect what automakers will do, and which the price drop of the Bolt seems to point at, is that they'll keep offering EVs at the higher price point for better margins on their vehicles as long as they have the tax credits and incentives available since consumers who buy them get an effective purchase price that are comparable to their closest ICE competitors while the automakers get to pocket more money, but then will do some combination of drop the MSRP shortly afterwards, hold prices and let inflation catch up, and/or add more capacity/range and features to remain competitive. We've already seen that with Tesla and the Bolt. Nissan's up next for the federal tax credit sunset.
You also recently saw this in play with the reduction in incentives in the UK in regard to which vehicles are eligible as there's been a recent change in their incentives system that had a lowered price limit for EVs to qualify for incentives along with a reduction in the incentives amount. This kicked off multiple manufacturers lowering the price of some of their EV models in order to meet that new minimum.
I also think that's a decent rationale for not extending the federal tax credit any further. Investing in electrical grid infrastructure improvements and such is fine and very much necessary for more than just EVs, but more federal tax credits and incentives? Really not that into it especially since battery prices per kWh have dramatically improved over the last decade and look poised to continue those improvements. If there were to be extensions of incentives, the only extension of incentives that would be even remotely sensible to me is to have a price cap that's around or lower than the average price of a new car sale for an incentive that's not a tax credit (I really like the Porsche Taycan, but it's ridiculous for someone who is buying a six figure performance vehicle for the performance that an EV allows them over an ICE vehicle to be eligible for the federal tax credit), trade-in incentives for vehicles with very poor emissions and mileage, or maybe slight rebates on installing chargers. Before even going into that though, I think it makes sense to first make SUVs and pickups eligible for the gas guzzler tax just as other light-duty vehicles are, subject to the same emissions requirements as other light-duty vehicles are and to have the same first year depreciation cap for businesses that purchase new vehicles that other vehicles are subject to.
Last edited by OyCrumbler; 04-05-2021 at 11:48 AM..
There's going to have to be a way for the aftermarket to sell the batteries. The big question is, will the auto manufacturers make it extremely difficult for that to happen? Will they try to their best to "lock out" any aftermarket battery in an attempt to force people to use dealer service depts?
There may eventually develop such an aftermarket. At this point though, the batteries being used in EVs are fairly advanced, proprietary designs, and that will probably be the case for years to come. It's different than replacing the starter battery in the car with a commodity 12V battery from Auto Zone. Not saying it won't happen later, but for the time being I think it will be difficult for 3rd parties to offer replacements, even if there are no anti-competitive business practices.
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