Does a lower "total cost of ownership" boost electric car sales?
In 2015, battery-electric vehicles in Japan, the UK, California, and Texas were slightly cheaper than traditional gas or diesel vehicles-as long as you're comparing all these vehicles using their total cost of ownership (TCO).
From article, (In 2015, battery-electric vehicles in Japan, the UK, California, and Texas were slightly cheaper than traditional gas or diesel vehicles—as long as you're comparing all these vehicles using their total cost of ownership (TCO).
The good news is that, in all four of the studied regions, the TCO for low-emission vehicles fell between the year the car was introduced and 2015. Although the researchers cited regenerative braking, stop-start engines, and “a novel transmission system” as factors that increase the manufacturing costs for low-emission vehicles, operating costs, lower fuel costs, and savings on taxes and maintenance all help offset these. Generally, the most expensive difference between an electric or hybrid vehicle and an ICE vehicle is the cost of the battery, but that cost has been rapidly falling. Bloomberg New Energy Finance estimated that in 2016 (PDF), electric vehicle batteries cost just $273/kWh compared to $1,000/kWh in 2010.
The study also says that government subsidies shouldn't last forever. Generally, economists have agreed that once electric vehicle batteries hit $100/kWh, they'll be cost competitive with ICEs. "It is paramount that there is a gradual phase-out of incentives once technology has reached cost parity, especially when oil prices are low," the researchers conclude.)
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