McKinsey Quarterly

Electric cars to become inevitable, cost competitive, by 2020ish says report

Falling battery pack prices will contribute to lower cost of ownership for electric cars, and a few years into the future electric cars could be cheaper to own than gasoline powered ones, according to a report from McKinsey Quarterly.

A study released recently by McKinsey & Company says that, because of falling battery prices, electric vehicles are inevitable. Shifting prices will make electric cars cost-competitive with gasoline in the 2020's. That would erase one of the two resistance factors to buying an electric car: the price. The other resistance factor, electric car driving range, will be erased along the way, according to the report.

McKinsey, a business management consulting company, published the study on its website late last week. Researchers developed a cost model for battery packs based on 40 underlying cost factors. With it they identified three factors that would accelerate the mass adoption of electrified vehicles, by decreasing the cost for battery packs, and improving the total-cost-of-ownership.


Share on Facebook submit to reddit Share on Google+

Sign-up to our email newsletter for daily perspectives on car design, trends, events and news, not found elsewhere.