Audi Working to Make Electric More Affordable With Low-Cost Batteries

As Audi prepares to launch new models, it has reportedly negotiated cheap power for its cars.

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One of the largest costs of manufacturing an electric car is the cost of batteries, and cutting costs for EVs will at some point almost certainly have to come from the power-storage units. In a recent interview translated from German, Audi’s Research and Development boss claims that the auto manufacturing giant is doing just that.

Generally, batteries are priced per kWh. Audi claims they are able to secure purchasing at $112 per kWh on some models—much lower than other manufacturers pay, though they still need to go lower.

We have opted for a top-down strategy because most buyers will be found in this segment. Currently, one kilowatt-hour costs around 100 euros (~$112 USD per kWh) depending on the model. Only when we are significantly lower than this price is e-mobility also interesting in volume segments.

This is extremely important, given the price per kWh of other manufactures; Tesla, for example, has claimed a $190 / kWh cost. On a P100D, which has a 100 kWh battery, this equates to $19,000 for the battery alone. At the $112/kWh price point, a similar 95-kWh battery in the 2019 e-tron Quattro would cost $10,640—a staggering 44 percent less than its Tesla counterpart.

A decrease in battery pricing is extremely important for manufacturers interested in mass-producing affordable electric cars while still maintaining a profit. Audi recently announced their plans to launch three new all-electric vehicles by 2020, and even began proceedings to renovate its Brussels facility to accommodate for the increase demand in electric cars.

After reports that the Tesla Model 3 would be a hard sell to break even, the need for market-appropriate prices are more important than ever. Lower prices in batteries and the world of EVs helps to increase competition and lower prices—something great for both the consumer and the adoption of all-electric platforms in a gas-powered world.