EV repair costs predicted to be 30pc higher by 2027

US analyst firm Gartner is predicting that by 2027, next-generation battery electric vehicles (BEVs) will, on average, be cheaper to produce than a comparable internal combustion engine (ICE).

However, it says that new technology will make electric vehicles more costly to repair.

Gartner predicts that by the same year, the average cost of an electric vehicle body and battery serious accident repair will increase by 30 per cent.

“This means BEVs will reach ICE cost parity much faster than initially expected, but at the same time, it will make some repairs of BEVs considerably costlier,” said Pedro Pacheco, vice president of research at Gartner.

As a result, vehicles suffering a collision may be more prone to a total write-off as the repair could cost more than its residual value.

Equally, more expensive crash repairs may lead to more expensive insurance premiums or even the refusal of insurance companies to cover particular car models.

Gartner says the fast reduction of BEV production costs should not be done at the expense of higher repair costs, as it may generate consumer backlash in the long run. New ways to produce a BEV must only be deployed together with processes to ensure low repair costs.

What’s more, Gartner is predicting that by 2027, 15 per cent of EV companies founded since the last decade will be acquired or bankrupt.

“This does not mean the EV sector is crumbling. It is simply entering a new phase where companies with the best products and services will win over the remaining,” said Pacheco.

EVs will continue growing market penetration in 2024. Gartner estimates EV shipments will reach 18.4 million units in 2024 and 20.6 million units in 2025.

However, Gartner claims we are moving from “gold rush to survival of the fittest”. “This means the success of companies in this space is now heavily conditioned by their capabilities to respond to the needs of early mainstream EV adopters,” the company said.