Electric vehicle prices fall below hybrid costs globally

Global average prices for electric vehicles (EVs) have fallen below those of hybrid vehicles for the first time. According to data from Mobility Global, the average list price for an EV was approximately $37,000 last year, a 9% decrease since 2020. In contrast, hybrid vehicle prices rose by 16% during the same period to roughly $39,000.

This shift is driven primarily by declining lithium-ion battery costs, which account for 30% to 40% of total vehicle production costs. China, which controls about 80% of the battery market, has seen battery prices drop by an estimated 37% between 2020 and 2025. The industry is also increasingly adopting lithium iron phosphate (LFP) batteries, which are more cost-effective as they do not require expensive cobalt.

Additionally, the aggressive expansion of Chinese manufacturers like BYD into emerging markets is driving down prices through economies of scale and vertically integrated supply chains. In Vietnam, the market is seeing a surge in new model launches, including the affordable VinFast VF 2, which received over 29,000 orders within three days of its launch. Other brands such as Lynk & Co, Jaecoo, and Hyundai are also introducing new electric and hybrid models to meet growing consumer demand.