EV Battery Pack Prices Reduce To $100/kWh For The First Time In History

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With increased use of battery electric vehicles across the globe, the Lithium-ion battery pack prices have drastically reduced

The prices of the Lithium-ion battery pack have gone down drastically over the last decade from about 1,100 USD in 2010 to just 137 USD per kWh this year. Over the next three years, the average prices will be close to 100 USD/kWh according to a report. The prices are less than 100 USD per kWh for the batteries used in the electric buses in the largest consumer in the world, China.

The volume-weighted average stands at 105 USD/kWh and at the cell level, it averages at just 100 USD per kWh. It must be noted that the battery pack portion accounts to 21 per cent of the total price. The survey from Bloomberg considered electric buses, commercial EVs, stationary storage, passenger electric vehicles, etc and the average pack prices will be 101 USD per kWh by 2023.

There are many reasons for drastic reduction in prices including the bulk orders, extensive usage across different sectors, overall increase in battery electric vehicle sales, new advancements in design, extraction of optional efficiency, different sizes and so on. Other main reasons stated by BloombergNEF are reducing manufacturing costs due to above factors and new cathode chemistries.

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The prices of the cathode materials have stabilized this year despite peaking back in 2018 according to the survey. The report said it is a historic achievement and amidst the prices for raw materials expected to return to the high points two years ago, it would only help in delaying average prices reaching $100/kWh by two years as leading battery makers are moving up the value chain.

They are also investing in cathode production or even mines and enduring gross margins of up to 20 per cent. Their facilities are operating at rates of more than 85 per cent in utilization. Having high utilization rates is significant in bringing down cell and pack costs. The different chemistries in the market have led to wide range of prices as companies are pushing to mass produce high energy density batteries.

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It includes lithium nickel manganese cobalt oxide and lithium nickel manganese cobalt aluminum oxide. The survey is convinced that reaching 101 USD per kWh by 2023 is clear and some hurdles are expected too. Furthermore, the prices will further go down to 56 USD per kWh by 2030.