More from the UBS id3 strip report,
UBS disassembles & analyzes ID.3 - electrive.com
"UBS analysts have disassembled a VW ID.3 and come to the conclusion that the MEB platform is “fully competitive” with Tesla in terms of cost. VW achieves “first-class energy density, efficiency and scalability”. That being said, when it comes to the battery and its costs, Tesla remains ahead.
According to the UBS experts, VW has a cost disadvantage of 1,300 US dollars per car (currently 1,078 euros) compared to Tesla when it comes to batteries and it is “unlikely” that this gap can be closed in view of Tesla’s vertical integration and innovative strength. For the disassembly of the ID.3 and the subsequent analysis, the major Swiss bank worked with the electric car experts of the P3 Group.
In terms of the costs for the production of the vehicles and the important margin in sales, VW could reach parity by 2025, according to the analysis. In other words from then on, VW would earn as much on the sale of an ID.3 as on a Golf.
VW’s software platform and ecosystem are top-notch compared to most classic OEMs, but are “years behind Tesla”. The LG battery cells used in the VW ID.3 cost around $100 per kilowatt-hour (€83/kWh), putting them in the top 3 worldwide, along with CATL and Tesla.
Although an ID.3 was disassembled for the analysis, UBS says it expects to be able to transfer the results to other vehicles based on the MEB. Since a Model 3 was already disassembled two years ago, UBS considers its figures on the price difference for the batteries to be reliable. Based on this experience, the experts dare to predict that the advantage in battery costs with the structural battery packs in the Model Y with the 4680 cells could bring Tesla’s cost advantage back up to 2,000 dollars (1,659 euros) per vehicle."
Using the TSLA Q4 2020 numbers average price per vehicle is $59k and average cost per vehicle is $48k (I am throwing all energy sales & revenue in the pot for simplicity) for GM of $11k and a 19% GM%. An average model 3 will be lower than that as the Y, S, X costs and prices will raise the fleet average. So lets take a SWAG and say that an average 3 maintains the same GM% of 19% but a price of $42k and a cost of $34k for a GM of $8k.
I am unclear from what is written if the id3 is equal cost with the 3, or would be equal cost except for the $1300 / $2000 battery cost penalty. The "fully competitive" bit is somewhat misleading 1! Let's assume that VAG is not actually "fully competitive" but is instead "nearly fully competitive" and this would give an equivalent VAG product the same price of $42k, a cost (now) of $35.3k and a GM of $6.7k for a GM% of 16%.
So the 'now' position is a VAG GM% of 16% and a TSLA GM% of 19%.
Fast forward a year and UBS and TSLA both expect that TSLA will be adopting the 4680 cells and decreasing costs by a further $700. I would hazard a guess that TSLA costs will go down a lot more than that due to the front & rear castings, and due to increased localisation (no shipping to EU, no import duties - gotta be worth 10-15% GM alone in EU, or say 5% on the global blend). But let's be somewhat conservative and just make that $1000 reduction. TSLA's past form is to lower price as costs reduce so TSLA would then be at:
cost = $33k; price = $41k; GM = 8k; GM% = 19%
VAG would need to follow and their situation would become:
cost = $35.3k; price = $41k; GM = 5.7k; GM% = 14%
It is worth bearing in mind that VAG is in the best position of all the legacy car manufacturers.