Electric Vehicles to Reach Price Parity with Fossil Fuel Models in 2024, Account for Two Thirds of Global Car Sales by 2030

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A new report predicts that electric vehicles (EVs) will reach price parity with fossil fuel models in Europe in 2024 and the U.S. market in 2026. The report, by the Rocky Mountain Institute (RMI), also predicts that EVs will account for two thirds of global car sales by 2030.

The report’s findings are based on the expected decline in battery prices. Battery costs are currently around $151 per kilowatt hour (kWh), but RMI predicts that they will halve this decade, to between $60 and $90 per kWh. This would make EVs “for the first time as cheap to buy as petrol cars in every market by 2030 as well as cheaper to run.”

Batteries are a major cost component for EVs, accounting for around 40% of the price tag. The decline in battery prices is being driven by a number of factors, including increased production volumes, technological advances, and government subsidies.

The RMI report also found that the rapid growth of EV sales in Europe and China is expected to continue. In the European Union, EV sales jumped almost 61% in July versus the same month in 2022, accounting for 13.6% of all car sales. The European Union aims to ban the sale of new fossil-fuel models from 2035.

The United States has not yet committed to a date for ending sales of combustion engine models, but California and New York are both targeting 2035 to switch to selling only zero-emission models.

The RMI report’s findings suggest that the transition to EVs is accelerating. If the predictions are correct, EVs could account for the majority of new car sales within the next decade. This would have a significant impact on the global oil market, as well as air quality and climate change.

Here are some additional points that I would like to add to the article:

  • The RMI report is based on a number of assumptions, including the continued decline in battery prices, the growth of EV sales in Europe and China, and government policies that support the transition to EVs.
  • The report does not address some of the challenges that could slow the adoption of EVs, such as the lack of charging infrastructure in some areas.
  • Despite these challenges, the RMI report’s findings suggest that the transition to EVs is on track to accelerate in the coming years.

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