Goldman Sachs: “Battery Prices to Fall Below $60/kWh by 2030”

Mobility Portal Europe analysis reveals implications for EV cost parity and market uptake.

The sustained decline in battery pack costs is expected to accelerate price parity between electric vehicles (EVs) and internal combustion engine (ICE) models.

According to Goldman Sachs’ latest projections, the average global cost of battery packs is forecast to drop from over $150/kWh in 2023 to below $60/kWh by 2030.

The report, underpinned by data from Wood Mackenzie and SNE Research, anticipates that by 2026, the $80/kWh threshold will already be crossed—marking a pivotal inflection point in the mass adoption of EVs across all market segments.

This trend is visualised in Goldman Sachs’ graphical analysis, which illustrates a consistent reduction across all components of the energy storage system: cathode and anode materials, operations and maintenance, pack integration (notably via cell-to-pack designs), and profit margins.

Why is the $60/kWh milestone so crucial?

While the $100/kWh benchmark has long been considered the gateway to EV-ICE price parity, breaking through the $60/kWh barrier could prove even more transformative.

At this level, the cost of a 60 kWh battery could fall from $9,000 to just $3,600. This dramatic drop would translate into a 20% to 30% reduction in overall manufacturing costs for electric vehicles, depending on the model and segment. The effect will be particularly evident in compact cars, small SUVs, and light commercial vehicles—segments where pricing has historically posed an entry barrier for average consumers.

Key drivers behind the cost decline

The Goldman Sachs analysis identifies five main factors accelerating the downward trend in battery costs:

1. Economies of scale: The construction of gigafactories and assembly hubs in key regions is lowering per-unit production costs.

2. Technological innovation: The adoption of lithium iron phosphate (LFP) batteries, solid-state chemistries, and cell-to-pack architectures removes intermediary components while improving energy density.

3. Industrial design optimisation: New manufacturing techniques allow more efficient integration of battery cells directly into the vehicle chassis, reducing weight and boosting performance.

4. Digitalised manufacturing: Artificial intelligence and automation in quality control are minimising material waste and enhancing efficiency.

5. Regulatory and decarbonisation pressures: The EU, China, and the United States are driving investment in R&D through aggressive climate legislation and green industrial strategies.

Who is leading the price drop?

SNE Research points to major Asian battery manufacturers as the primary catalysts behind falling prices, with the following companies currently dominating global supply:

• CATL and BYD (China)

• LG Energy Solution and SK On (South Korea)

• Panasonic (Japan)

Nonetheless, Europe is rapidly narrowing the gap through key industrial initiatives such as:

• Northvolt in Sweden, which has signed supply agreements with BMW and Volkswagen.

• ACC (Automotive Cells Company), a joint venture by Stellantis, Mercedes-Benz and TotalEnergies.

• Verkor, currently constructing its plant in Dunkirk with support from the French government.

In parallel, the Inflation Reduction Act in the United States and the European Net-Zero Industry Act are catalysing a wave of both public and private investment across the battery sector.

Which vehicle segments will benefit most?

The cost reduction will have varying impacts depending on the type of vehicle:

• Compact and utility models: Prices for EVs in the B and C segments are expected to fall below €20,000, especially for LFP-equipped models produced in China or Eastern Europe.

• Light commercial vehicles and urban vans: Improved total cost of ownership (TCO) could accelerate fleet electrification in logistics and last-mile delivery.

• Emerging markets: With lower battery costs, EVs may become viable even without public subsidies—opening up new opportunities in Latin America, Southeast Asia, and Africa.

Brands such as BYD, MG, Renault, Fiat and Dacia are well-positioned to capture this emerging demand, while legacy automakers like Volkswagen and Stellantis continue to ramp up the development of low-cost modular EV platforms.

When will full price parity be achieved?

Goldman Sachs forecasts that unsubsidised price parity between EVs and ICE vehicles will be reached between 2027 and 2029 in key markets such as Germany, France, the Netherlands, China, and Norway. In Southern European markets like Spain, the transition may take slightly longer but remains inevitable.

In the medium term, this cost evolution is expected to enable the gradual phase-out of public incentives without undermining the competitiveness of EVs against traditional combustion models.

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