Back in December, I already wrote about why 2020 will be the most important year in automobile history, and cited an interview with Elon Musk anticipating autonomous (and electric) cars to outnumber human-driven (and, of course, gasoline-powered) cars by about the 2060s-2080s.

Well, it turns out those forecasts were pretty accurate:

Bloomberg New Energy Finance just released a study claiming that electric car sales will be up to 40 million units by the 2040s, up from just half a million last year. While pleasantly surprising to see a report so perfectly echo Musk’s estimations, it’s pretty neat to see how the math works out.

For starters though, first check out the video clip below. It’s a great interview, and I encourage you to watch the entire thing. I’ve queued it up to start at about the 8:40 mark.

Elon Musk is breaking down the math for how long it would take to replace all cars and trucks in the world with electric vehicles. Since there are nearly 2.5 billion vehicles on the road today, and the total output of all vehicles is about 100 million per year, it would take about 25 years to completely replace the entire fleet of Earth’s vehicles if output instantly switched to 100% electric vehicles today.
Obviously though, the entire planet’s output of vehicles is not shifting to 100% electric over night, but rather, they will be gradually phased in, albeit at faster and faster rates, beginning in earnest in the mid-2020s. So add in some margin of delay of a few decades, and you’re looking at roughly 2060-2080, and certainly by 2100, for a time when gasoline-powered cars are all but replaced — if not rendered illegal — on most public roads.
And while this may seem long a time way from now, it really isn’t: I will surely live into the 2060s and probably even the 2070s — actually, I plan to live forever, but that’s another point altogether — and most babies born today will make it to 2100.
So if you crunch the numbers while making some super simplified assumptions:
  • we need to get EV output to 100 million units per year worldwide by, say, 2100
  • let’s assume the ramp up to 100 million units per year will be linear
  • 2100 is 84 yeas from now, so that’s 1.2 million units per year until then
  • 2045 — the mid-point of the “2040s” — is 29 years from now
  • so in 29 years we should expect about 35 million units per year, or nearly the 40 million predicted by the Forbes study
So it’s nice to see that the Forbes study and Musk’s predictions do indeed dovetail quite neatly, and is very cool indeed.
But that’s not all. “By 2022,” the study says, “the unsubsidized total cost of ownership of BEVs [battery electric vehicles] will fall below that of an internal combustion engine vehicle.” This is a really big deal, and basically means that by 2022 — just six years from now — there will be no financial reason not to own an EV.
Obviously, this forecast comes with many caveats, not least of which is the reliance on several assumptions such as an adequate rollout of charging infrastructure, not to mention continued reduction in the price of batteries, currently by far the most expensive component of EVs.
Already, the price per kilowatt-hour of batteries has plummeted a staggering 65% between 2010 and 2015, from $1000 to $350, with prices estimated to drop as low as $200 by 2022 and $120 by 2030. Meanwhile, GM claims to be paying only $145 per kilowatt-hour for its upcoming Chevy Bolt, though this has not been verified. That said, it would explain the Bolt’s and upcoming Tesla Model 3’s imminent launch during the next two years.
So while EVs will surely not outnumber conventional-fuel vehicles before the last two or three decades of the 21st century, absent some legal mandate to expedite their arrival, it’s nice to know that the next four to ten years will see them finally reduced from technology novelty to just another mundane form of transportation.
And that, more than anything, will help to further drive their adoption.

2 thoughts on “EVs to reach tipping point in 2020s, cost less than gas cars

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