The cost of electric vehicle (EV) battery cells has ramped up by a fifth as the war in Ukraine has accelerated rises in raw material prices, according to a major carmaker.
India's Tata Motors said the price of lithium has been a particular driver for battery cell prices, which have been on the rise for several months.
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The head of the company's EV arm predicted battery cell prices will remain high for about a year, according to a report from Reuters.
This ties in with comments from the boss of Daimler (ETR:DAI) Truck who told the FT that costs of manufacturing battery-powered trucks will “forever be higher” than a petrol-powered rivals.
He said the €25,000 full cost of a truck with an internal combustion engine compared to around €24,000 just for the battery cells in a 400kwh electric truck.
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As well as lithium, prices of other key battery metals have been climbing fast, including nickel and cobalt, as demand from EVs and the electronics industry outstrips the supply side, which has been severely hampered by the rippling effects of Russia's invasion of Ukraine.
Even in early March, a report from Rystad Energy suggested total EV battery costs had more than doubled since the start of the year, based on an analysis of spot pricing.
This suggested the price of batteries has spiked from US$60 to US$130 per kwh – around $9,000 per battery.