If lithium-ion (Li-ion) batteries can reach substantially lower costs, they will supercharge the adoption of plug-in vehicles and stationary energy storage. However, the energy storage industry is notoriously secretive about today’s Li-ion battery costs and their future trends. Players also disagree about the right path forward: Some are pursuing gigafactories making cylindrical nickel cobalt aluminum oxide (NCA)-based cells, while others are taking a completely different approach. This report uses a new bottom-up Li-ion cost model to account for differences in battery chemistry, form factor, production scale, location, and other nuances. We find that Li-ion battery pack prices will fall to $172/kWh by 2025 for the best-in-class players (while others will lag at more than $229/kWh), and also analyze the resulting impact on more affordable electric vehicles (EVs) and stationary applications.