SEOUL (Reuters) – Hyundai Motor Co believes electric vehicle battery prices will level off by 2020 due to supply constraints of key ingredients, ending years of sharp declines that have helped stimulate activity in the booming sector.
FILE PHOTO: Dean Evans, Hyundai Motor America Chief Marketing Officer, introduces Hyundai’s new “Ioniq Unlimited” Subscription-based Ownership Experience at the 2016 Los Angeles Auto Show in Los Angeles, California, U.S November 16, 2016. REUTERS/Mike Blake/File Photo
Despite its cautious outlook, the South Korean carmaker and smaller affiliate Kia Motors Corp planned to release 38 green models using a variety of technologies by 2025, Hyundai Motor Senior Vice-President Lee Ki-sang said.
“Not a single ingredient is going in a positive direction in terms of pricing,” Lee, who oversees Hyundai’s green car operations, said in remarks to reporters last week that were embargoed until Wednesday.
While rivals have announced ambitious plans for electric vehicles, some analysts say Hyundai has been late to the game. It plans to launch a long-range electric vehicle next year, well behind the likes of General Motors Co and Tesla Inc.
Batteries are the most expensive part of electric vehicles, and their affordability is key to the take-up of the technology.
Lithium-ion battery cell prices fell about 60 percent in the five years to 2016 as larger-scale production made them cheaper to make.
In September, Reuters reported that Volkswagen (VOWG_p.DE) was moving to secure long-term supplies of cobalt for the group’s electric vehicle plans, but its talks with cobalt producers in November ended without a supply deal.
Lee said that although Hyundai Motor saw the need to develop batteries in-house, it still relied on outside suppliers due to a lack of economies of scale to secure raw materials.
In aimed to release vehicles powered by solid-state lithium batteries by about 2020, promising greater range and safety than existing lithium-ion units.
Japanese rival Toyota Motor Corp also has announced a similar schedule for the development of solid-state battery-powered vehicles.
Fiat Chief Executive Sergio Marchionne said on Saturday the two companies were in talks about a technical partnership in hydrogen and transmissions.
“We are not at a stage where we can discuss it publicly,” Lee said.