Analysts: 40% drop in 2023-2025 EV battery prices will boost sales | KLRT [Video]

A number of factors may be converging to lower EV battery prices, which in turn could boost EV demand, according to new analysis from Goldman Sachs.

Analysts expect nearly a 40% decline in EV battery prices between 2023 and 2025, and for EVs to “reach breakthrough levels in terms of cost parity” with internal-combustion vehicles in some markets as early as next year—without subsidies. That’s due to lower materials cost and the effect of a current stagnation in EV sales allowing supply to catch up with demand, according to the analysis.

Stack of Rivian battery cells

Goldman has lowered its forecast for growth in global battery demand in 2024 to 29% year-over-year from a previous projection of 35%. The firm estimates that battery demand increased 31% in 2023.

This is putting less pressure on the battery materials market, cooling demand for metals like nickel and lithium (something other analysis has pointed out) and helping to lower battery prices, which …