One of the significant barriers to many drivers switching to electric vehicles (EVs) is the cost. Despite prices dropping on average, EVs can still cost significantly more than internal combustion engine (ICE) powered vehicles.
However, that problem may soon disappear as Volvo’s CEO boldly predicts EVs will achieve price parity with ICEs by 2025.
Jim Rowan, Volvo’s boss, also said EV makers should not have to depend on government subsidies to succeed. He made these remarks at an event in Stockholm, Sweden.
Rowan said, “We think we get [to price parity] … around 2025, where there’ll be enough technology that’s driving down cost on the battery. Technology will drive range up. Less batteries, but more range, at less cost — we’ll get there.” (via Automotive News)
The battery is the primary reason EVs are so expensive. It can account for one-third of the sticker price.
However, Rowan believes technology will bring down the price enough to make EVs more affordable.
Interestingly, the CEO is pointing at the need for less battery for more range to cut costs instead of battery costs dropping.
Volvo is just fresh off revealing the EX90, a three-row electric SUV. The carmaker sold about 50,000 plug-in cars in Q1 2022.