Taking charge: Battery advancements and electric vehicles

September 25, 2018

Taking charge: Battery advancements and electric vehicles

As the electric and autonomous vehicles markets evolve, significant advances are being made in battery technology and the race is now on to build battery packs that can compete on cost with the internal combustion engine.

There is a lot of debate about how much battery packs of the future will cost with a target of US$100 per kilowatt-hour often held up as the figure which will make them competitive with conventional petrol and diesel fueled engines. Given recent technological advances, that could be achievable by 2022-23.

Battery costs have already been dropping at about 15% per year over the past decade. Scale manufacturing and adjustments in the way chemicals and technology are applied in battery construction are also helping to improve battery energy density and the range they allow electric vehicles to travel.

Major tire manufacturers are also addressing the challenges set by the weight of EVs by developing better tires specifically designed for them. Because of the sheer weight and the higher torque of electric battery driven vehicles, their wheels do need stronger tires with lower rolling resistance. Tires will need to improve over time to support this market.

Frank Goguen and Barry Mills, senior research analysts, Mellon, BNY Mellon Company

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Views expressed are those of the authors stated and do not reflect views of other managers or the firm overall. Views are current as of the date of this publication and subject to change. This material has been distributed for informational purposes only and should not be considered advice for investments or a recommendation of any particular investment, strategy, investment manager or account arrangement. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. Please consult a legal, tax or investment advisor in order to determine whether an investment product or service is appropriate for a particular situation. No part of this material may be produced in any form, or referred to in any other publication, without express written permission. BNY Mellon Investment Adviser, Inc., Mellon and BNY Mellon Securities Corporation are subsidiaries of BNY Mellon.

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