Volvo CEO: Electric cars to cost same as conventional ones around 2025

Volvo CEO Jim Rowan is convinced that in a few years the prices of electric cars would become equal to the prices of internal combustion units.

Jim Rowan delivered the statement on the prices of electric and conventional vehicles,  which now differ on average by about 30%, amid an opposite trend in the market. Over the last few months, the demand for electric cars has increased due to the COVID-19 pandemic, shortage of chips and a drastic increase in the prices of gasoline and diesel, which pushed prices in the segment upwards, writes Automotive News, as reported by InsideEVs.

In the United States, according to the New York Times, sales of battery electric vehicles increased by 70 percent in the first nine months of this year from the same period of 2021, while declining 1% in the sector of conventional cars and trucks. The year-to-year price increase in October was about 7%.

New electric cars can be bought today as of EUR 20,000

Today new electric cars can be bought for as little as EUR 20,000, while the choice is much wider if someone can pay around EUR 30,000. The level doesn’t include government incentives, which in Europe range from EUR 2,000 to EUR 12,000. Also, owners of electric cars have lower expenses than conventional vehicles because of fuel.

Jim Rowan’s forecast partly differs from previous similar statements.

Rowan: It will take fewer batteries than today to run electric cars

Around 2025, electric cars will reach price parity with conventional counterparts because technology will advance, so batteries will be smaller and with a larger range, Rowan said.

In particular, he said EV prices aren’t going to drop because of a fall in battery costs, but that batteries would decrease in size.

The new electric Volvo will cost USD 80,000

Also, he expressed the belief that carmakers should not await government subsidies, arguing instead how they must produce vehicles that consumers want and can afford.

Rowan offered his view during the presentation of the company’s new model – the seven-seat electric SUV EX90, which will replace the existing XC90 model. The price of the XC90 is USD 50,000, while the EX90 will be sold at USD 80,000.

The head of Volvo’s also announced a city car model for 2023. It should help the company sell more cars and lower its prices.