"Normally, components are cheaper if you order large volumes, but just the opposite for electric batteries," continues Herrmann. BMW also expects higher prices for battery systems – and are by far the largest cost factor for e-vehicles.
"Electrified vehicles have negative production costs compared to conventional burners, mainly due to the price of raw materials for batteries," said BMW Development Board Klaus Fröhlich. "Due to global demand, their costs are constantly increasing," Fröhlich continued. Currently, unlike the rest of the industry, suppliers can dictate prices to cars. After all, production capacity is and will continue to be substantially lower than demand for now.
"I expect the prices of these batteries to increase by about 10 percent in the medium term and if the predictions we have found are correct, we have to expect bottlenecks in electric batteries," says Herrmann. Thus, electric cars, which are already much more expensive than internal combustion engine models, continue to be much more expensive in the long run. In addition, cars will probably be more expensive.
"With the high cost of batteries, it will not be worth it to equip small cars," said Herrmann. Most would have a future with gasoline engines – this would only be for a limited time. After the tightening of the CO2 limits planned by the European Commission, most small cars will also cause too much emissions. "With mid-range and high-grade electric cars, we should compensate for CO2 emissions of smaller cars above the limit values, which in the long run would not be a business model for the car manufacturer," says Herrmann.
The result is that mobility is more expensive at the beginning.