The continued electrification of the automotive industry has in part been driven by an 80% decline in battery costs per kilowatt-hour from 2013 to 2021. The International Energy Agency, however, anticipates a 15% increase in battery pack prices in 2022 compared to 2021 if metal prices remain at the levels experienced during the first quarter of 2022. The impact of higher metal prices is likely to be mitigated by auto and battery makers implementing other more cost-effective chemistries, but these price increases nonetheless pose challenges for automakers, increasing battery costs, decreasing profit margins and raising costs for consumers.
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