With that in mind, a key factor driving TCO parity between ICEs and EVs is the rapid decline in battery costs.

A crucial force driving battery cost decline is the rapid scaling of the lithium-ion supply chain. Major suppliers, such as CATL, are poised to deliver some of the lowest cost batteries in the world through R&D, automation and access to low cost mining assets. With the planned reduction of cobalt in future nickel magnesium cobalt (NMC) batteries, sourcing concerns regarding the supply chain are also beginning to fade. Furthermore, as mining assets are located in China, Latin America and various other markets, there will never be a monopoly on the battery industry.

So, what’s holding customers back from widespread EV adoption?

Range anxiety – or worrying that a battery will run out of power mid-route – is a key psychological barrier. Although the majority of passenger vehicle users do not drive more than 100km per day, many perceive the range of EVs to not be high enough to warrant a purchase.

Charging infrastructure is a problem, too. Drivers have found that charging points are not readily available throughout the countries they live in, therefore posing problems for long-range driving – a key consideration before buying an EV.

Wood Mackenzie Power & Renewables believes that most customers are likely to charge their cars at home, as utilities will eventually set price signals to incentivise this behavior. Therefore, charging concerns are also a psychological barrier to some extent.

It is inevitable that most customers will eventually opt to purchase an EV over a standard ICE due to the plethora of offerings currently being developed. The oncoming transformation in the automotive sector is not too dissimilar to that seen in the smartphone market. History doesn’t repeat itself but it sure does rhyme. It may take some time for 100% EV penetration, but it will happen eventually.