Cost of EV Batteries Not Expected to Drop Anytime Soon

The great hope for electric vehicles (EVs) is for a rapid decline in the costs of batteries. An article in the Pro section of the Wall Street Journal reports on skepticism from the US National Academies of Science and Toyota that a rapid battery cost decline is possible. Recommend you read in full if you are seriously interested in the debate about the prospects for EV battery costs.

The Academies and Toyota Motor Corp. have publicly said they don't think the Department of Energy goals are achievable and that cost reductions are likely to be far lower. It likely will be 20 years before costs fall 50%—not the three or so years the DOE projects for an even greater reduction—according to an Academies council studying battery costs. The council was made up of nearly a dozen researchers in the battery field.

Even in lithium batteries other minerals make up a substantial portion of total costs. So just cheaper manufacturing will only go so far. On the other hand, costs of copper or cobalt or other minerals are kind of like once-in-a-lifetime costs for car buyers because at the end of a battery's useful life it can be recycled to extract out the most valuable minerals. So the trade-in value of an old battery will partially offset the cost of a replacement battery.