One of the barriers to many drivers switching to electric vehicles is their prices. Despite costs dropping on average, EVs can still cost more than internal combustion engine (ICE) vehicles, as per Drive Tesla Canada.
However, that problem may soon disappear as Volvo’s CEO predicts EVs will reach price parity with ICEs by 2025.
Volvo’s CEO, Jim Rowan, also stated that EV makers should not rely on government subsidies to succeed. He made these remarks at an event in Stockholm, Sweden.
Price parity around 2025
“We think we get [to price parity] … around 2025, where there’ll be enough technology that’s driving down cost on the battery. Technology will drive range up. Less batteries, but more range, at less cost — we’ll get there.” said Rowan.
The battery is the main reason EVs are costly. It can amount to one-third of the sticker price.
However, Rowan believes technology will lessen the cost enough to make EVs more affordable.
Notably, the CEO also points out the need for less battery for more range to cut prices instead of battery costs dropping.
Furthermore, Volvo just unveiled the EX90, a three-row electric SUV. It also teased a smaller electric crossover. Currently, the manufacturer offers the XC40 Recharge and C40 Rechargeelectric crossovers.
Nearly all of its models are available in different plug-in electric vehicle (PHEV) designs. Notably, the automaker sold about 50,000 plug-in cars in Q1 2022.
Rowan also referenced a “city car” style crossover that the company will reveal next year. Smaller EVs should also aid the automaker sell in higher volume and lessen costs.