Electric vehicles seen as sliver of 2020 market

A Citroen C Zero electric car is displayed on media day at the Paris Mondial de l'Automobile September 30, 2010.

DETROIT (Reuters) - Automakers around the world are pouring money into developing a slate of hybrid, plug-in and electric vehicles, but pure EVs are expected to make up just a sliver of the global auto market in a decade's time.

Pure electric vehicles-- which do not have an internal combustion engine and are plugged in to recharge-- will make up around 5 percent of the global auto market by 2020, some auto experts said.

Nissan-Renault CEO Carlos Ghosn has a more bullish projection of 10 percent. Other industry insiders, like Ford Ford Motor's (F.N) Derrick Kuzak, say that percentage will be far smaller.

"The business model doesn't compute," BorgWarner Inc (BWA.N) CEO Timothy Manganello said at the Reuters Global Autos Summit. "The more these guys make electric vehicles, the more money they are going to lose."

Manganello projects pure electric vehicles will make up between 2 percent and 5 percent of the overall market by 2020, potentially including some range-extended vehicles.

One of the main stumbling blocks for the widespread adoption of electric cars is the price of the batteries, which Manganello said can cost between $10,000 and $14,000 to replace.

"You are never going to have a low cost car as an electric vehicle," said Manganello. BorgWarner is a leading supplier of turbochargers and other engine and transmission components.

Kuzak, Ford's head of product of development, projected hybrid, plug-in and electric vehicles will make up between 10 percent and 20 percent of the overall auto market. Of that slice, just 5 percent will be battery-electric vehicles, he told the summit.

Toyota Motor (7203.T) U.S. sales chief Bob Carter said in the near term, hybrid vehicles will be a "core volume technology" for the world's largest automaker.

"We do see a market for EVs. but their cost and convenience is still a large question," Carter said. "To get the cost and not having consumers sacrifice convenience is still going to take some advancement in the battery technology."

But one top battery maker said the price of these batteries are set to tumble over the next decade to levels that make alternative powertrains as cheap as internal combustion engines.

"It's been on a pretty steep cost curve and I think we will continue to see costs going down, in fact my internal target is getting it down by a factor of 2 to 4 over the next five to 10 years," said Prabhakar Patil, the chief executive of LG Chem (051910.KS) unit Compact Power.

Compact Power is a supplier of batteries for General Motors's (GM.N) electric Chevrolet Volt.

Patil said he expects electric vehicles to account for about 5 percent of all U.S. auto sales in 2020 -- and to go up after that as automakers like Ford increase the percentage of the new cars they sell that are electric drive or partly electric.

(Reporting by James Kelleher, David Bailey and Deepa Seetharaman; editing by Carol Bishopric)