The Future of Electric Vehicles

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For every cumulative doubling of production measured by kilowatt hours, you get a fixed percent cost decline. For batteries, that's 28%. And what we're seeing in the battery space is actually something pretty interesting. As the rest of the drivetrain and the power electronics have become more efficient, we're able to shift to less energy dense cells which are cheaper as well. The best vehicle out there is charging 200 miles in 15 minutes.

Welcome to the Big Ideas Monday Miniseries, brought to you by the For Your Innovation Podcast.

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To learn more, view Big Ideas 2023.

This week’s Big Ideas Monday Mini Episode focuses on Electric Vehicles.

Investors once questioned whether the future was electric. Demand for EVs has scaled despite a pause in cost declines caused by commodity price shocks. Now investors doubt whether or not the growth will be exponential.

The debate around electric vehicles has shifted from demand to supply. Based on Wright’s Law, ARK forecasts that EV prices will decline and sales will increase more than 7-fold, or 50% at an annual rate, from roughly 7.8 million in 2022 to 60 million units in 2027.

The biggest downside risks to our forecast are supply constraints that could continue to impact pricing and the speed at which traditional automakers transition to electric vehicles.

Sources: ARK Investment Management LLC, 2023. Forecasts are inherently limited and cannot be relied upon. For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security. Past performance is not indicative of future results.