In China, EVs are now cheaper than gas cars. In the U.S., the Big Three still haven't closed a premium that's $14,000 per vehicle

"China has now crossed a massive benchmark in the electric-car race: battery-powered vehicles are now cheaper than their gas counterparts. In the U.S., by contrast, EVs still face a steep premium; roughly $14,000 on average, according to new data from JATO dynamics, an automotive data analytics firm. Dan Sperling, founding director of the UC Davis Institute of Transportation Studies, told Fortune he thought the $14,000 figure was overestimated - but conceded that there was a strong, real gap."

"That chasm reflects more than just consumer preferences, Sperling said. In China, there's also been a "frenzy of competition" to make low-cost EVs, with the heads of different provinces trying to oust each other for the top spot. Labor and battery costs are also lower in China, thanks to its domestic supply chains. "People talk about subsidies, but at this point the subsidy effect is pretty minor," he added."

"The average price of a Chinese internal combustion engine is €22,500 (approximately $26,205), whereas a battery electric vehicle costs 3% less, or €21,900 ( $25,509) on average, according to JATO. That's a big change from just five years ago, when gas EVs cost 10% more. The results are visible everywhere. Leading Chinese automaker BYD sold more than 4 million cars last year-10 times what it sold in 2020-and now dominates roads across the world, from Bogotá to Budapest."

Battery-electric vehicles in China are now cheaper than equivalent internal-combustion cars, with average BEV prices about 3% below ICE prices (€21,900 vs €22,500). In the U.S., EVs still carry an average premium of roughly $14,000, though some experts think that number may be overstated. The Chinese market has seen intense competition, provincial incentives, lower labor and battery costs, and integrated domestic supply chains that reduce costs; subsidies play a minor role now. BYD's rapid scaling, aggressive pricing, and battery control drove massive sales growth. U.S. legacy automakers remain largely unprofitable on EVs and slow to scale, linked to weak federal policy support.

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