Hyundai Motor Co believes electric vehicle battery prices will level off by 2020 due to supply constraints of key ingredients, ending years of sharp declines that have helped stimulate activity in the booming sector.Â
Despite its cautious outlook, the South Korean carmaker and smaller affiliate Kia Motors Corp planned to release 38 green models using a variety of technologies by 2025, Hyundai Motor Senior Vice-President Lee Ki-sang said.Â
According to Reuters, Lee, who oversees Hyundai’s green car operations, said “Not a single ingredient is going in a positive direction in terms of pricing,”. “So far battery prices have been declining at a rapid pace, but the pace will moderate significantly or maintain the status quo by 2020.”
While rivals have announced ambitious plans for electric vehicles, some analysts say Hyundai has been late to the game. It plans to launch a long-range electric vehicle next year, well behind the likes of General Motors Co and Tesla Inc .Â
Demand for minerals such as nickel, cobalt and lithium used in electric car batteries is forecast to soar in the coming years as governments crack down on vehicle pollution and carmakers step up their investments in electric models.Â
Batteries are the most expensive part of electric vehicles, and their affordability is key to the take-up of the technology. Lithium-ion battery cell prices fell about 60 percent in the five years to 2016 as larger-scale production made them cheaper to make.Â
Lee said that although Hyundai Motor saw the need to develop batteries in-house, it still relied on outside suppliers due to a lack of economies of scale to secure raw materials.Â
