By 2030, EVs could cost the same as their gas guzzling siblings

0:00What would it take to charge up the electric vehicle market? From American public media, this is Marketplace Tech. I'm Megan McCarty-Karino. Marketplace Tech is supported by GEP with GEP key agentic AI and GEP smart software. GEP is at the forefront in agentic procurement orchestration and autonomous supply chains. Seems like every time we get a spike in gas prices, more people start talking about switching to an electric vehicle. But what converts that talk into action? Generally, according to market experts, it comes down to the upfront cost. Cars are expensive, and electric cars tend to be even more expensive. But that could change in the next few years as Marketplace's Novasafo reports.

1:02Americans just don't buy electric vehicles in large numbers. And the primary reason for that is the sticker price, says Stephanie Valdez-Streeti, of the data firm Cox Automotive. We still have a price premium for EVs, so we need more affordable, compelling EVs to really get into that next wave of adoption. Our premium averages $8,000 over the cost of gasoline vehicles. And the single biggest reason is the battery inside. Since the battery is about 40% of the cost of a vehicle, the battery price going down is going to be critical. And we've seen that, right? The place we've seen that is China. We'll be right back. You're listening to Marketplace Tech, I'm Megan McCarty-Karino. We're back with Marketplaces, Novasafo. One in every two Chinese consumers in the market for a new car are buying electric. In part, that's because of government incentives.

2:02But the main reason, says Colin McCarty-Karino, of research firm Bloomberg and EF, is that Chinese car buyers are seeing very different sticker prices than consumers in the US. When we look at the average purchase price of different vehicles in a market like China, they are on average that EV is now fully cost competitive with internal combustion engine vehicles in terms of sticker price. China got there by integrating supply chains, a process the US is undertaking as well. More importantly, China bet on the right battery technology. The West bet on NMC. That's nickel-manganese cobalt batteries, which need those namesake and expensive rare earths. China bet on LFP. Lithium iron phosphate batteries, bulkier but cheaper because iron is abundant. Macarachra says over the last decade or so, Chinese engineers have improved LFP batteries. They're now smaller and charge faster.

3:03That's made them attractive to automakers. It has become the main battery technology going into EVs around the world. So just last year, it crossed over 50% of all batteries going into EVs around the world are Lithium iron phosphate batteries. And as automakers accelerate adoption, electric vehicles in the US are forecast to get cheaper. Analysts say they'll cost the same as internal combustion engine vehicles or ice vehicles in industry parlance in the next three to four years. Among those making that prediction is CJ Finn. He leads advisory firm PWCs, automotive division. In order for adoption in the US to occur, it's an economics game in that 15 to 20% premium that battery electric vehicles have to the ice vehicles that needs to come down and we need to see parity. Once that happens, Finn expects electric vehicle sales here to accelerate to as much as 30% of all new vehicle sales. With hybrids taking about another third or slightly more than that and ice vehicles being

4:04a third. It will be a dramatic change. Last year, just 22% of all new vehicles purchased in the US were electric or hybrid. That was Marketplaces, Nova Sofo. I'm Megan McCarty-Korino and that's Marketplace Tech. This is APM. Hey, David Brunkachio here. I hope you're well and that your passport is up to date because I am hosting a trip to Italy this fall and you, you, are invited. Stay at a world-class Tuscan Villa and step into the world of the Medici, the formidable family whose influence and power help give rise to the Renaissance and the art we still celebrate today and not to mention the banking system. We're going to visit the world's oldest bank, swim in the thermal spa waters in Montecatini and take in the art of the Yufizi. All of this and then we'll try to put it all into context with great conversation over even better meals and wine tasting.

5:07Please join me and know this. Buying into this trip will provide essential support for public media. Discover more about this fall's Tuscan Villa Adventure at Marketplace.org-slave-travel to reserve your spot today. That's Marketplace.org-slave-travel.