What’s the breakdown cost of building an ev

tom1ie

First of all I’ll start of by saying I’d love to own an ev but the second hand ev market is too expensive at the moment for me (my budget would be 8-10k) and I understand this is down to a low supply which is understandable.

However my question is why are bev’s so expensive to build in comparison to ice cars?
Is it the cost of batteries?
I presume an electric motor works out cheaper to make and put together compared to an ice motor?
The shell of the cars (ice vs bev’s) would be fairly similar.
Is it down to economies of scale- factories are setup to produce ice at the moment not bev’s therefore bev’s are a side project compared to ice cars, therefore it costs a lot to change the configuration of the factories.
Is it down to car manufacturers artificially keeping the price of bev’s high so as not to cause the price of ice cars to plummet, thus wiping billions off their own assets, as ice would be the majority asset they own?

I’d love to see a breakdown of the individual cost of every part that goes into an ice car vs a bev car.

Just a thought.

Lumen

I've seen estimates of 50% of the production cost being in the drivetrain (batteries, motors, battery integration).

BEVs will be more expensive to produce for the foreseeable future, so the industry is trying to focus customers on the total cost of ownership (including fuel savings).

Some answers in here, but it's complex.

https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/making-electric-vehicles-profitable

KCross

tom1ie wrote: »

First of all I’ll start of by saying I’d love to own an ev but the second hand ev market is too expensive at the moment for me (my budget would be 8-10k) and I understand this is down to a low supply which is understandable.

However my question is why are bev’s so expensive to build in comparison to ice cars?

Is it the cost of batteries?

I presume an electric motor works out cheaper to make and put together compared to an ice motor?
The shell of the cars (ice vs bev’s) would be fairly similar.

Is it down to economies of scale- factories are setup to produce ice at the moment not bev’s therefore bev’s are a side project compared to ice cars, therefore it costs a lot to change the configuration of the factories.

Is it down to car manufacturers artificially keeping the price of bev’s high so as not to cause the price of ice cars to plummet, thus wiping billions off their own assets, as ice would be the majority asset they own?

I’d love to see a breakdown of the individual cost of every part that goes into an ice car vs a bev car.

Just a thought.

All of the above!

And the batteries are not made by the auto manufacturers. Its outsourced so they have less wriggle room when it comes to negotiating a price and its one of, if not the, most expensive parts of the car. That makes it much harder for the manufacturer to make a cheap EV as they already have all the other bits down to a fine art at this stage (robotics, assembly, welding, painting etc).

If you cant reduce those traditional costs and you're being charged top dollar for the battery you are stuck on price!

tom1ie

Lumen wrote: »

I've seen estimates of 50% of the production cost being in the drivetrain (batteries, motors, battery integration).

BEVs will be more expensive to produce for the foreseeable future, so the industry is trying to focus customers on the total cost of ownership (including fuel savings).

Some answers in here, but it's complex.

https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/making-electric-vehicles-profitable

Wow that surprises me. I was of the understanding that the cost of batteries is coming down and isn’t hugely expensive at the moment.
An electric motor has fewer moving parts than an ice and has been around since approx 1880 in one form or the other.
The drivetrain I don’t know much about tbh but would it be more complex than a regular drive shaft on an ice?
If batteries are still expensive is it due to the cost of mining lithium or producing the cells etc?
It’s interesting alright.

tom1ie

KCross wrote: »

All of the above!

And the batteries are not made by the auto manufacturers. Its outsourced so they have less wriggle room when it comes to negotiating a price and its one of, if not the, most expensive parts of the car. That makes it much harder for the manufacturer to make a cheap EV as they already have all the other bits down to a fine art at this stage (robotics, assembly, welding, painting etc).

If you cant reduce those traditional costs and you're being charged top dollar for the battery you are stuck on price!

So that’s why Tesla are building/have built gigafactories, to control that cost themselves.
Why are batteries so expensive though? Is it the cost of mining the lithium, or producing cells or is it just they are in massive demand so battery manufacturers are making massive profit?

Mike9832

From what I have seen from breakdowns on speakev

About £10,000 or so all in for the different bits for a small car like a Leaf

50kWh battery - €7,000
Motor -€1,500
Controller/Inverter/ -€1,500
Other (motors, wiring, switches, etc.) - €1,000

Less the cost of the engine, exhaust system, filters, fuel tank and all the other crap in a regular ICE is about €3,000 - €5,000

About €5,000 more expensive is what they came out with

It's pretty obvious autogiants are adding the cost of R&D, retooling huge warehouses etc on to the price we pay.

Cause in no world does a Kona EV cost €48,000 ( pre grant/vrt incentive ) vs a €21,000 1.6l Diesel Kona to produce

Mike9832

KCross wrote: »

All of the above!

And the batteries are not made by the auto manufacturers. Its outsourced so they have less wriggle room when it comes to negotiating a price and its one of, if not the, most expensive parts of the car. That makes it much harder for the manufacturer to make a cheap EV as they already have all the other bits down to a fine art at this stage (robotics, assembly, welding, painting etc).

If you cant reduce those traditional costs and you're being charged top dollar for the battery you are stuck on price!

Not really true tbf

Autogiants autosource everything these days.

From bolts to airbags, to even engine blocks, they make very little inhouse

Batteries will be no different, cost of entry is too high

They will be a commodity in oversupply in years to come, wouldn't be worth autogiants time getting involved

Tesla for example would buy straight from LG etc years ago, if they had cheques to cash in the early days, they didn't and had to go a different route

Look at how LG will now supply Tesla batteries in China for it's gigafactory

tom1ie

Mike9832 wrote: »

From what I have seen from breakdowns on speakev

About £10,000 or so all in for the different bits for a small car like a Leaf

50kWh battery - €7,000
Motor -€1,500
Controller/Inverter/ -€1,500
Other (motors, wiring, switches, etc.) - €1,000

Less the cost of the engine, exhaust system, filters, fuel tank and all the other crap in a regular ICE is about €3,000 - €5,000

About €5,000 more expensive is what they came out with

It's pretty obvious autogiants are adding the cost of R&D, retooling huge warehouses etc on to the price we pay.

Cause in no world does a Kona EV cost €48,000 ( pre grant/vrt incentive ) vs a €21,000 1.6l Diesel Kona to produce

Yeah and this was the comparison I was thinking of. So basically we aren’t going to see affordable ev’s anytime soon due to legacy structures being in place with existing manufacturers.
So if this is the case our best hope of an affordable ev would be a company like Tesla who don’t have to re- tool their warehouses etc.
the only problem with that is at the moment they are on a tiny scale compared to their ice counterparts.
Therefore we are not gonna see affordable evs in the next 10 yrs?

KCross

Mike9832 wrote: »

Not really true tbf

Which bit isnt true?

Mike9832 wrote: »

Autogiants autosource everything these days.

From bolts to airbags, to even engine blocks, they make very little inhouse

That's true, but the battery is such a large percentage of the overall cost it gives you much less wriggle room to reduce costs if that supplier is sticking to their guns on price.... which they are.

If you were a manufacturer today you could go to any number of high volume engine manufactuers and source one for your new model or even make it yourself as its old tech now. With batteries you have less than a handful to choose from.

Mike9832 wrote: »

They will be a commodity in oversupply in years to come, wouldn't be worth autogiants time getting involved

I think the problem is that it takes too long to "get into it" and if there is a battery breakthrough it could sink your investment. They are hanging back and letting the battery manufacturers do the innovation but it means they are beholden to them then so a catch-22.

The next 5 years will be interesting... certainly alot more interesting than the last 5!

Mike9832 wrote: »

Tesla for example would buy straight from LG etc years ago, if they had cheques to cash in the early days, they didn't and had to go a different route

Look at how LG will now supply Tesla batteries in China for it's gigafactory

My understanding of their partnership with Panasonic in Giga 1 was to ensure they had dedicated supply at a fixed cost and not open to market forces/manipulation. It was the right thing to do as its a crucial component.

Is the LG deal for the Shanghai factory any different? I havent seen any detail on that. Will LG produce cells onsite like Giga 1 or will they be shipping the cells in from existing plants in Korea?

KCross

Mike9832 wrote: »

It's pretty obvious autogiants are adding the cost of R&D, retooling huge warehouses etc on to the price we pay.

Cause in no world does a Kona EV cost €48,000 ( pre grant/vrt incentive ) vs a €21,000 1.6l Diesel Kona to produce

That too I suppose.


They also have to factor in that their parts/servicing revenue is going to drop so they add that onto the upfront cost.

KCross

tom1ie wrote: »

Therefore we are not gonna see affordable evs in the next 10 yrs?

Tough one to call but what alot of manufacturers and govts are saying is that we will have price parity by 2025 (depends on where you read it). The gotcha is that when they say price parity they are not talking about purchase cost, they are talking about TCO.

So, EV's are going to remain priced higher than equivalent ICE for quite some time and you factor in your fuel/servicing etc savings to decide if its worth it for you. If you do low mileage it may not be cheaper.


And then, just as it starts to make sense the governemnt will start pulling the grants keeping the prices high for another few years


So, it could be 10yrs. Who knows.

VW's pricing of an entry level ID.3 will be a key indicator. They are the only ones that have a big EV plan.

scamalert

People forget that batteries is main EV issue, and batteries been hardly touched for decades in terms of development especially for long term storage. as indicated below stats are crap and its expensive compared to combustion engine if one looks at reliability past 10 yrs.



Cobalt is the safe element in the cathode. As you reduce it, you reduce the life cycle of the cell. The current market standard for electric vehicles is an eight-year warranty to retain 80 percent of the original capacity of the battery. You need to be sure your battery can do that, otherwise, you’ll have to replace it under warranty, which is way more expensive than the theoretical savings you gain from less cobalt.
And there’s a safety issue as well. As you decrease the amount of cobalt, you increase the amount of nickel. The cells can overheat and it can no longer effectively cool itself, which can lead to combustion. That’s a relatively low risk but it’s not a risk that can be taken and you need special technology to avoid that. Plus, the low-cobalt formulations need to produce in special dry environments, and so there’s a cost to making them, too.

So id say its safe to say its not companies holding out rather that development isnt there to make the leap for them to be as reliable as combustion engines.

krissovo

The various government grants in play add “Cost” to EV’s. The second a grant for anything is applied the cost is increased by the suppliers.

tom1ie

scamalert wrote: »

People forget that batteries is main EV issue, and batteries been hardly touched for decades in terms of development especially for long term storage. as indicated below stats are crap and its expensive compared to combustion engine if one looks at reliability past 10 yrs.



Cobalt is the safe element in the cathode. As you reduce it, you reduce the life cycle of the cell. The current market standard for electric vehicles is an eight-year warranty to retain 80 percent of the original capacity of the battery. You need to be sure your battery can do that, otherwise, you’ll have to replace it under warranty, which is way more expensive than the theoretical savings you gain from less cobalt.
And there’s a safety issue as well. As you decrease the amount of cobalt, you increase the amount of nickel. The cells can overheat and it can no longer effectively cool itself, which can lead to combustion. That’s a relatively low risk but it’s not a risk that can be taken and you need special technology to avoid that. Plus, the low-cobalt formulations need to produce in special dry environments, and so there’s a cost to making them, too.

So id say its safe to say its not companies holding out rather that development isnt there to make the leap for them to be as reliable as combustion engines.

Interesting points, but I wonder does this account for ALL the price differential we see between, say, a bev kona vs diesel kona.
Also I though solid state batteries were on the verge of a breakthrough 2 years ago?

tom1ie

krissovo wrote: »

The various government grants in play add “Cost” to EV’s. The second a grant for anything is applied the cost is increased by the suppliers.

Yeah we see that in childcare for example. Government issues a grant aimed at reducing cost to parents, crèche raises prices.
But I wonder in the case of evs, if evs weren’t incentivized, would they have ever have got the manufacturers to start building them at all?
Obviously the manufacturers had to be pushed somehow to get them to start designing cars that don’t burn fossil fuels (not withstanding the argument about evs charging off fossil fueled electricity....).

KCross

Emissions regulations are primarily what drives the manufacturers to develop EV's (hybrids, PHEVs and BEVs).

If they do nothing and continue to only produce ICE cars they will die as they wont meet the regulations and massive fines will fall due from 2021 onwards.

unkel

tom1ie wrote: »

So basically we aren’t going to see affordable ev’s anytime soon

There are several EVs for sale today in the €25k-€30k range. And lots more coming next years. That's only a touch more than base model Skoda Octavia money, a car considered to be pretty affordable? Granted of course these EVs would have cost €10k more without the grants..