Do you remember, way back when large, flat-panel TVs hit the market? They were all the rage, but the price tag was prohibitively expensive.
In 1997, The Phillips/Fujitsu Plasma flat screen TV hit the market with a retail price of $22,924. The TV was accessible for the very few, but out of range for the average consumer at an average cost of $30.45 per square inch.
Twenty years later, in 2017, LG produced a 55” TV for $2,300 for an average cost of $1.78 per square inch. The TV provided better quality and resolution than the old plasma TVs at a cost that was far more accessible to the average consumer. (Source: CNET)
Today, a quick online search shows 55” TVs retailing for under $400 at Bet Buy, Walmart and other retailers. Big screen TVs are now affordable for everyone.
The same trend is starting to appear in the Electric Vehicle (EV) industry.
Back in 2017 the Tesla Model X retailed near $100,000. The same Model X retails for $66,000 in 2023, according to Cargurus
Driving around Austin where I live, you might have been able to spot a Tesla or two on the roads while running errands a few years back. Today, I see more Teslas on the road than Mercedes. It’s a game I like to play while driving.
Elon Musk is Driving Down the Cost of EVs, Competition Responds
In a recent article by Reuters, Tesla announced its sixth U.S. price cut, dropping the cost of the Model Y to a base price of $39,990, well into the neighborhood of comparable internal combustion vehicles. When you add EV tax credits of up to $7,500, the price drops even further.
The price reductions are believed to gain market share in the face of EV competition from multiple car makers. And it’s not just in the U.S. Tesla has announced price cuts in China, Japan, Australia, Singapore and Europe as well.
In response, price wars are breaking out in China for comparable EVs, according to an article in the New York Times.
The Biden administration is investing heavily in a national network of EV charging stations as part of his national infrastructure bill. Walmart and other retailers are looking into installing their own charging stations. As the network of charging stations expands across the country, EVs will become not only more affordable, but it will provide greater driving range.
Just like TVs becoming far more affordable over the past few decades, the same is happening with the EV industry. Stay tuned as we follow this trend.