According to Volvo CEO Jim Rowan, electric cars will cost roughly the same as gas-powered cars within three years. “We think we get [to price parity]…around 2025,” Rowan tells Automotive News.
The prediction is aggressive. Few industry experts have been willing to put their name to a date, but most that have expect it to come close to the end of the decade.
Economies of scale will do some of the work — everything gets less expensive as we build more of it. But Rowan says improved battery technology will do the rest. “Technology will drive range up. Less batteries, but more range, at less cost — we’ll get there.”
Rowan, a Scotsman in charge of a Swedish company, came to Volvo from vacuum maker Dyson at the start of 2022. He oversaw the development of Volvo’s future flagship model, the 2024 Volvo EX90, which premiered last week.
The EX90 pioneers a host of new technologies. These include LiDAR-based safety systems designed to see obstacles in the dark before the driver can detect them and interior-based radar sensitive enough to identify a baby breathing under a blanket to power a rear-seat occupant alert. But it uses the same lithium-ion battery technology as other EVs currently on the market.
Other industry experts have been less optimistic about price parity. Analyst Sam Abuelsamid told Automotive News Volvo might get there simply because it builds luxury cars, where prices are high from the start. “In more mainstream segments,” he said, “you don’t have that margin headroom to work with.”
