At Tesla Inc.’s ballyhooed Battery Day event in September, CEO Elon Musk set himself an ambitious target: to produce a $25,000 electric car in three years. Hitting that sticker price — about $13,000 cheaper than the least expensive model today — is seen as critical to deliver a true, mass-market product.
Getting there means finding new savings on technology, most critically the batteries that can make up a third of a vehicle’s cost. Musk says innovations and in-house manufacturing can quickly halve that expense, while most competitors see a slower road to reach price parity with gas guzzlers.
Why are EV batteries so expensive?