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At an Automotive Press Association meeting this week, the Boston Consulting Group (BCG) released the results of a new cost study on battery electric vehicles and it doesn't look good for electric vehicle fans. BCG thinks it is unlikely that the cost of batteries will drop nearly enough to make EVs price competitive with internal combustion vehicles in the next decade without continued tax incentives. The current $7,500 federal tax break for plug-in buyers is unlikely to still be in place by 2020 and BCG doesn't see any battery breakthroughs on the horizon.

However, it's not all bad news for EVs. There do appear to be some holes in the new study. For example, the study cites a current cost of $1,000-1,200 per kWh for automotive lithium ion batteries. That figure may be as much double the actual cost if General Motors is to be believed. When we spoke with Denise Grey and Jon Laukner from GM this week they both hinted that the Volt battery was actually in the $500-600 / kWh range now and they expect this number to drop. We obviously don't have any independent data to back that up, but Grey indicated that the $1,000+ cost was for prototype units, not mass production.

One of the reasons the cost of automotive batteries will likely remain higher than the $250 price of consumer electronics units is because of the need for robust testing, including crash and vibration proof packaging, thermal management and safety sensing. Nonetheless, Grey was confident that a $300 price point was achievable, which would prove BCG wrong. Thanks to Mike M. for the tip!

[Source: Detroit News]


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  • 40 Comments
      • 5 Years Ago
      By 2020, batteries will be under $300 a kWh, gasoline will be well over $5 a gallon, and the news articles will have titles like: "What can be done to keep gasoline vehicles cost competitive, or is it hopeless?"
        • 5 Years Ago
        Presently, all battery manufacturers are concentrating their attention to Lithium for manufacturing such cells. Personally, I consider the Lithium technology for an interim solution only. There are several points that speak against a Lithium based technology.

        1) Lithium is not an abundant element and will, in course of time, create certain unwelcome dependencies.
        2) Lithium can, in its own virtue, be an extremely aggressive element and must be harnessed with considerable effort so that it can be safely handled.
        3) The charging of series connected cells (battery) is not unproblematic. A good and sound BMS is absolutely necessary to exploit the maximum potential of a Li-ion battery; it is a sophisticated bit of electronic equipment offering many potential points of failure and subsequent trouble.
        4) The presently proven charging cycle life of a Li-ion battery is acceptable but not satisfactory.
        A final solution could be based on carbon. Carbon is one of the most abundant elements available. It's inexpensive and not in the least dangerous. Lately, considerable progress has been made improving technology for devising carbon nano tubes. The innovative methods are close to production at industrial scale. The nano tubes with a wall-to-wall gap of 50 nm are so to say a standard achievement but could be reduced even further to approx. 20 nm; the considerable increase of surface area is almost mind-bogging.
        A close relative to this material is Graphene, also a carbon product. The electrical properties of Graphene are absolutely fantastic. The problem remaining to be solved, is to coat carbon nano tubes with graphene without suffering losses of the Graphene properties. The resulting synthesis would surpass any known supercap and battery. Such a solid state devise has no chemistry as a battery and would not be subject to deviations dependent on temperature drift. Its life would be virtually unlimited. Power density and energy density would be history. The only remaining problem to be solved would be power sourcing. But that could be solved against the interests of "big business" as well.
        • 5 Years Ago
        Chris:

        I think you missed the point.
        Just a rough comparison: Iron and steel have a lot in common but the're definitely not the same. A little additive of carbon to iron composes steel; and that makes all the difference.

        Graphene is not 3-dimensional as carbon nano tubes and that makes all the difference between them. Graphene is 2-dimensional only and its terrific inherent electrical attributes are constituent of its unique atomic structure. The engineered sheets of Graphene have no height (thickness is one atom high) only width and length. When two sheets are layered on top of each other some of the fantastic properties are lost. The more sheets are stacked together the more properties are lost. Carbon nano tubes and Graphene both consist of elementary carbon but their atomic structure makes all the difference. Perfectly engineered graphene is absolutely flat; attemts to force it into forms like a honeycomb complex will disrupt its atomic structure and it looses its properties. Carbon nano tubes have some fantastic atributes in their own merit but cannot be compared with those of graphene. If a procedure can be established, with which CNTs could be coated with graphene, allowing the properties of graphene to be almost wholly upheld - then all problems associated with electric storage devices would belong to the past.
        Such a solid state device would rather correspond to a capacitor than to a battery but would really be neither one or the other (perhaps a battacitor).
        • 5 Years Ago
        Geronimo:
        1) Lithium is fairly abundant, certainly abundant enough to supply all our needs for well over a century. The current supplies in Bolivia and China are simply the richest thus cheapest, but lithium is available almost everywhere and can even be extracted from seawater at a reasonable price.
        2) That "agressiveness" of Lithium is due to its high electronegativity, that in turn is why it makes such a powerful battery. Another inherent characteristic of Lithium is its very low atomic weight, which helps give Lithium batteries their high energy to weight ratio, or "energy density".
        3) Battery management of LiIon batteries is a solved problem, and battery managment is a requirement for virtually any type of high performance battery.
        4) There are high powered LiIon batteries that can be charged in 15 minutes or less. If that isn't fast enough, it is technically possible to swap a depleted battery pack for a charged one in 2 minutes.

        Carbon is already used in various batteries (including some LiIon batteries) due to its conductivity and light weight, but as a supporting agent, not in an electrochemical way. The problem is that carbon isn't very "electronegative", and oxidation of carbon to produce energy tends to produce gaseous products. In fact, I am unaware of any type of battery that uses carbon as an energy source. Now, there are high temperature fuel cells that can burn carbon to produce electricity, but that carbon is lost as gaseous CO2, and a supply of fresh carbon is needed.

        There is some interest in developing carbon nanotube based ultracapacitors, but those would require a much more sophisticated management system due to linearly varying voltages, and would be unlikely to exceed current LiIon battery energy density, and could never match the energy density of more advanced LiS and Li-Air cells now under development.

        BTW, carbon nano-tubes are simply graphene sheets rolled up into tiny tubes, and there is no point in using Graphene to coat them.
        • 5 Years Ago
        hehe
      • 5 Years Ago
      What kind of baloney is that about automotive batteries being more expensive than consumer electronics. A similar amount of testing is required for both. There are plenty of battery powered devices that need to work in rugged outdoor environments.

      What is powering Tesla cars anyhow, not dedicated automotive batteries. Maybe some automotive old timers have sniffed a little too much petrol. Battery manufacturers can tell them anything and they believe it.
      • 5 Years Ago
      For me cost is not the primary consideration, I am tired of being held hostage by oil companies. Moreover, as is mentioned from time to time, if cost was everyone's biggest concern then everyone would buy used cars, or Chevy Aveos, Hyundai Accents, etc.

      I cannot wait to drive a mainstream BEV and symbolically flip the bird to the oil companies. Ok, there may be a literal flipping of the bird here and there as I drive past gas stations.
      • 5 Years Ago
      Puppets cupping their hands for more government handouts.
      • 5 Years Ago
      Let's try some figures.
      For the Prius plug-in you have 5kwh of batteries, around $5-6k if the study is right, plus the cost of the plug in technology.
      This is around £3,750 at current exchange rates, and by the time it is out will be eligible for a £5k Government rebate!
      At that price, with similar deals available in Europe, it seems that the future of this relatively light plug in is assured, and so larger production can drive battery prices down.
      Ignoring this rebate, at 14.5 miles a day on electric you get around 5292 miles a year.
      Taking this at 30 miles to the gallon ( about what you get even in a fairly economical car in city traffic, and we don't need to show viability in the worst case, as they could be massively adopted by the best case users in great enough numbers to drive costs down for the rest ) then that comes to around 176gal/year.
      At around £5/gal that is a saving of £880/year.
      Electricity costs are hardly consequential, and I have not even allowed for exemption from the congestion charge and road tax.
      So you would get your money back in 4-5 years, and be secure against further petrol price increases and shortages.
      Not a bad buy, and enough to drive the cost down enough to make them viable for folk in the States.

      The Volt's economics are much more questionable, but a full EV may be a different matter, as you can throw out a lot of the cost in a traditional ICE or a hybrid.

      So the economics for a 'big enough' group of people in the world seems to be good enough to ensure success and cost reduction.

      • 5 Years Ago
      BTW, not to split hairs, but it's DENISE GRAY and JON LAUCKNER, not "Grey" and "Laukner."
        • 5 Years Ago
        I'm not so picky about spelling or grammar, but when you're using a person's proper name, making sure you spell it correctly is just simply showing respect.

        OTOH, you can tell a lot about a person from their use of language, proper spelling and grammar included.
        • 5 Years Ago
        wow
        • 5 Years Ago
        Spelling nazis have been victimized for a long time, but now is their time of vindication!

        The Christmas airline bomber would have been prevented from getting on the plane, but his name was misspelled by one lousy letter causing the match up with the no-fly list to fail.

        A spelling mistake nearly cost 300 lives!
      • 5 Years Ago
      Who was the study funded by? It seems like they did not project any increase in the price of gas outside of possible new gas taxes.

      The Detroit News is not exactly a big fan of EV technology and companies like Tesla.
      • 5 Years Ago
      Why the heck do people keep using these ridiculous fake battery cost numbers? *I* can buy automotive-style li-ion batteries for under $500/Wh, and I'm just an individual, with only low bulk purchase capability!

      How the heck does this garbage keep getting published?
        • 5 Years Ago
        Right. I was looking into thundersky lithium iron phosphate batteries a little while ago, vehicle-size bulk orders came out to about $500/kwhr. GM's battery costs may be a little higher in the short term (higher overhead testing costs and labor costs), but I would be surprised if we DIDN'T have a greatly superior battery chemistry costing < $250/kwhr by 2020.

        From the linked pdf above:
        "Most sources estimate the current cost of an automotive lithium-ion battery pack, as sold to OEMs, at between $1000 and $1200 per kWh. Citing the current cost of consumer batteries (about $250 to $400 per kWh), they further predict that this price tag will decline to between $250 and $500 per kWh at scaled production. However, consumer batteries are simpler than automotive batteries and must meet significantly less demanding requirements, especially regarding safety and life span."

        I was actually expecting the report to be a bit of a puff-piece, but it looks well-written. I'm going to read it through later. However, if the Volt pack is in the $500-600/kWh currently, that blows a rather large hole in their analysis assumptions.
        • 5 Years Ago
        Erm, that should read, "Under $500/kWh", not "Under $500/Wh". :P
      • 5 Years Ago
      This study shows what should be obvious: that electric cars may or may not be economically competitive, depending on the future cost of batteries versus gasoline.

      Duh.

      Their estimates for the future cost of batteries and gasoline result in electricity not being competitive -- but it's very easy to spin a scenario with the opposite outcome. Nobody has a crystal ball here.
      • 5 Years Ago
      I'm with all of the posters here. BCG should talk to real experts rather than to themselves before publishing the report, or at least be present at these briefings where this type of information gets disseminated. Either that, or stop publishing such patently stupid reports with bogus numbers. Whatever happened to verifying your facts before making a PR splash? If something as important as the battery costs are getting to be so widely debated and known as to be public knowledge, these guys have to be having their heads stuck where the sun don't shine.
      • 5 Years Ago
      I have to agree with the others here on 1) Who funded this study?, 2) Have they taken into consideration the total cost of ownership? and 3) How much will gas cost in the year 2020?

      There is obviously a coordinated effort by the oil companies and/or other corporate interests that do not want to see electric cars succeed. I've seen a bunch of ridiculous articles on CNN and other news outlets about the problems with electric cars and they are just filled with bogus and misleading information.

      Are there any journalists left that can do actual research and analyze what these biased groups are saying? It's really sad because the average yahoo doesn't have the critical thinking skills to figure it out for themselves so they are going to believe this garbage.
      • 5 Years Ago
      I believer that figure of $500/kwh of lithium battery from Denise gray because the Thundersky battery is ( just the battery) $378/kwh.

      John Marcon
        • 5 Years Ago
        What it sounds like they're doing is looking at the cost of cells like A123 offers in HEV applications (~2.5kWh packs) that actually need the high discharge rates (~30C) to make decent power (~100hp) via the electric motor. For pure electric vehicles the pack is going to be much larger, probably around 25kWh, and a manufacturer can go w/ cells like those made by TS w/ much lower discharge rates. That's still 100+ peak horsepower from the low end cells, plenty for most compact EVs, but using high end cells in the same EV w/ a ~25kWh pack would kinda be pointless since most cars have no need for a pack capable of delivering ~1000hp.
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