Cost of an EV Battery? Ford Says $12K+

It should be no secret that electric vehicles are pricey because of the extraordinarily high cost of their advanced lithium batteries. Yet, most folks still wonder why the purchase price of a battery powered vehicle is so high. Here’s a clue: Ford’s CEO Alan Mulally has now shared that the cost of the lithium-ion batteries used in the $39,200 Ford Focus Electric – Green Car Journal’s 2011 Green Car Vision Award winner – is $12,000 to $15,000 per vehicle.

Obviously, this kind of battery cost is limiting the number of electric vehicles automakers are willing to make since building them is just one part of the equation. The other important part is selling them…and that means either convincing buyers to step up to their higher price or relying on federal or internal subsidies, or both.

We’ve been through this before. During the test marketing of battery electric vehicles in the 1990s, people wondered why electric cars couldn’t be a success. We pointed out then, as we are again now, that the batteries in the EVs of the day – the GM EV1, Honda EV Plus, Toyota RAV4 EV, and others – were likely $20,000 to $30,000 per vehicle. The latter figure was confirmed to us by the late Dave Hermance of Toyota’s electric vehicle program some years ago.

So what really killed the electric car back then? The cost of batteries. We’re just hoping that battery development costs for a new generation of electric car batteries – whether lithium-ion or other technologies – can be overcome to provide the momentum needed by the emerging electric vehicle market.