Raw material costs for electric vehicles more than doubled during the coronavirus pandemic, according to a new report Wednesday by AlixPartners, forcing automakers from General Motors and Tesla to start-ups like Lucid and Rivian to significantly raise prices on new vehicles.
Average raw material costs for an EV totaled $8,255 per vehicle as of May, up 144% from $3,381 per vehicle in March 2020, led by materials such as cobalt, nickel and lithium – all essential for the production of batteries used to power electric cars and trucks. EV-specific costs have increased to $4,500 from roughly $2,000 in the past two years, according to AlixPartners.
The cost increases aren’t limited to EVs: Raw material costs for traditional vehicles with internal combustion engines have also more than doubled during that time period to $3,662 per vehicle, up 106% from an average of $1,779 per vehicle in March 2020. That uptick is being led by increases in steel and aluminum.