If an electric car worth $50,000 still loses $6,000, when will the electric car become profitable?
Traditional automakers are still losing thousands of dollars from electric vehicle sales, according to newly released analysis. Boston Consulting Group.
BCG estimates that most automakers lose about $6,000 on every electric vehicle they sell for $50,000, that price taking into account any tax credits or other incentives customers have. may be eligible to receive.
Automakers will only be able to close about half of that cost gap with technology choices, BCG estimates. The economies of scale created by increased electric vehicle production will help, but will not completely close the gap, according to analysts, adding that this could be a problem for with traditional automakers in the US market if heavily subsidized Chinese electric vehicles are disrupted. come here.
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“Closing the cost-benefit gap will require help from elsewhere, whether through more aggressive efficiency programs, additional public support, or both,” according to BCG. One possibility raised by analysts is to link financial incentives to scope or efficiency. And, as in most discussions about how to increase electric vehicle adoption, expanding charging infrastructure could also be a factor.
This is somewhat surprising, since several traditional automakers are already participating in programs where they are expected to profit from electric vehicles — or at least see it coming.
Mid-decade Ford EV platform, presented by Hau Thai-Tang
For example, General Motors suggested in 2018 that they could make money from electric cars in the future, in 2021, and last year Mary Barra suggested they might do it for models over 40,000 USD.
The simple answer may be based on volume. GM is expected to produce hundreds of thousands of Ultium EVs annually. Tesla is profiting from its electric vehicles, but it certainly helps to get there best-selling car on the planet and there is no legacy internal combustion business trending towards. Ford in February announced a new strategy focusing on Smaller, lower-cost electric vehicles in larger volumes to confront China’s potential rivals.
However, Stellantis CEO Carlos Tavares has said that electric vehicles cost the company 50% more to produce, and that’s not a premium that can be passed on to the final price. A new round of incentives, continued declines in electric vehicle battery prices and other factors such as tariffs aimed at preventing Chinese automakers from importing cars from Mexico could also change the profitability equation for automakers. American auto manufacturer.
