EV Depreciation

But business 101 is that if costs drop significantly and selling prices don't, profit margins increase significantly. Where a business sector remains very high margin, more and more entrants come along until competition increases and margins drop. I'm sure Tesla have upper management that are looking at current, and projected, new entrants and considering whether price cuts are needed to deter further entrants.

Of course, this must be weighed against manufacturing capacity too - as there's no point cutting prices by 30% after a 30% drop in costs if cutting by 5% will result in you selling everything you can produce.

So, assuming the lithium prices don't skyrocket in 2024, which is a big assumption I know, 2024 will see either price drops or the entry of new, yet unheard of, manufacturers.

Another variable is hedging. It's highly unlikely that any EV manufacturer hasn't hedged for lithium prices but I don't know to what extent each does - do they buy lithium in the futures market for the next 6/12/18 months? This will determine how much of this years 80% lithium price drop they're able to apply to vehicles currently being manufactured (and, more so, the rapid 40% lithium price drop in the last 3 months).

There will be traditional manufacturers that are using the traditional strategy of "we spent €X billion on EV research and development so we'll add €XX,XXX to the cost of each new EV to recoup this". Some of these are likely to find that recouping that R&D cost in this way is not possible due to the competition. The bulk of it may just need written off.

I don’t think the Germans are joining the party. VW price cuts are only on existing stock of outgoing models, no significant budge on sister brands like Skoda or Audi.

BYD seal is €25k in China, and €46k here. They can cut prices if they want.

Either they will or new manufacturers will enter the highly profitable market - and either is a good thing for us, the end buyer.

What category would someone who bought an EV before this year fall into in 2023? According to your interpretation, they aren't categorised and are only categorised in the year of their purchase.

It would have been a difficult proposition to develop a Duster style EV last year with lithium prices so high and batteries being so expensive - the battery would represent such a high proportion of the overall cost of a low priced vehicle.

This brings me back to one of my original points. Surely some big investors will be looking at the market, with lithium prices having dropped over 80%. Set up a new company, hedge lithium prices 2 years out and start producing low cost vehicles with your cost of batteries being lower than they've been in years. We may even see a Audi/VW/Seat style offshoot of BYD with a new budget brand. Who knows?

Yes, applying some logic based on facts (manufacturing costs have dropped by nearly 30%) and guesswork (a 10% tariff could be introduced) and discussing - one of the main points of a forum 😊

Bear in mind that the drop in manufacturing costs mean that we may see manufacturers absorb any theoretical tariff and still drop prices.

Of course, recent EV buyers or those awaiting a new BYD Seal will be annoyed in the short-term if prices drop further, not realising that lower prices are better overall for them in the long term, regardless of how much they may have saved had they held off on their current purchase for a few months.

How many times over the years have we heard from advertisements or dealers of VW/Audi/BMW, "buy now before the next 20xx price rise". It's good to see that turned on it's head.

Isnt VWs biggest market the Chinese?

Any EU sanctions will surely be matched by China and hurt German autogiants even worse.

BMW is something similar, plus a lot of automakers have partnered or are part owned by Chinese companies.

Geely owns 80% of Volvo, 50% of Lotus and Polestar, 10% of Mercedes and has a technology partnership with Renault to develop EVs.

The multiple apps is the number one problem imo and even an experienced user like you had issues. Of course most early adoptors will say they never had an issue or won't tell you if they did.

Its daft the chargers dont go use normal card payments.

A tourist here would also have issues downloading an Irish app if their google play country is set to another country.

The whole thing has been made complicated for most people who just want to rock up and get a quick charge.

And its unlikely to be solved while some people go around saying its ok, not an issue.

Ionity is now plug and charge (for me at least with an Audi)