Source: Wall Street See News Author: Bu Shuqing.
Bank of America Merrill Lynch predicts that after 2028, with the introduction of new vehicle platforms by OEMs, production costs are expected to decrease and the popularity of electric automobiles will experience accelerated growth.
According to Bank of America Merrill Lynch, with the progress of technology and the development of the market, the US electric vehicle market will experience a new wave of growth in 2028. However, before that, it still needs to overcome the high cost obstacle.
On Monday local time, analysts including John Murphy from Bank of America Merrill Lynch released research reports indicating that although the electric vehicle product channel is still secure, its penetration rate in the US market is expected to remain slow until 2028.
The report pointed out that from 2024 to now, the growth rate of electric vehicle sales is only 0.8%, which is far lower than 55.7% in 2023. Its penetration rate has also decreased from 7.5% in 2023 to an average of 6.8% from 2024 to now.
This slowdown is mainly due to the price issue of electric vehicles. Currently, only 3% of electric vehicles are priced below $37,000, compared to more than 50% of gasoline and hybrid vehicles priced below that level.
Bank of America Merrill Lynch pointed out that price competitiveness is crucial for the popularity of electric vehicles.
Including gasoline vehicles, hybrid vehicles and electric vehicles, 26% of the models sold in the US market are priced above $55,000, while 50% of the models are priced below $42,000. This data indicates that in order to make greater breakthroughs in the market, electric vehicles must have stronger competitiveness in terms of price.
Bank of America Merrill Lynch's analysts used both bottom-up and top-down analysis to predict the penetration rate of electric vehicles, and the results pointed to a delay of one year or more in the popularity of electric vehicles.
Among them, the bottom-up method predicts that the penetration rates of electric vehicles from 2024 to 2027 will reach 11%, 15%, 20% and 25%, respectively; the top-down method predicts that the penetration rate in 2024 will be 8%, in 2027 will be 14%, and in 2030 will reach 29% (previously 33%).
According to Bank of America Merrill Lynch's latest analysis report "Auto Wars", although the new product line of cars has decreased, the supply is still sufficient.
The report predicts that from 2025 to 2028, 60% of all car supplies, including hybrid, electric and fuel cell energy vehicles, will include supply of 113 new models of electric vehicles. This ratio has decreased from the previous forecast of 64%.
Bank of America Merrill Lynch pointed out that the cost of OEM producing electric vehicles may be reduced to the same level as traditional fuel engines before 2028. This means that although lower prices of electric vehicles may stimulate greater demand in the market, these OEMs do not have strong incentives or economic incentives to increase the production of electric vehicles on a large scale due to cost considerations.
However, Bank of America Merrill Lynch predicts that after 2028, with the launch of new vehicle platforms by OEMs, production costs are expected to decrease and the popularity of electric vehicles will accelerate.
Editor/Lambor