It can’t be easy being an automobile executive nowadays. With the fast-paced life we live today it is difficult to predict the future six-months out, let alone several years down the pike. Imagine the pressure auto execs face having to approve spending billions of dollars on a new vehicle during a two-, three- or four-year period and not be sure if there will even be a market for the final product. To make decisions even more difficult, most automakers are now global businesses and must build vehicles that not only appeal to a large body of buyers, but also meet the government safety/environmental regulations and mandates around the globe while dealing with external forces like petroleum production interruptions and tariff tiffs. Which brings me to the topic of today’s article: the status of environmentally clean electric vehicles.
The debate over whether there is a future in electric vehicles (EVs) may be the discussion of the moment here in the U.S., but worldwide it seems that the debate is over and the automotive future is electric. Unfortunately, the decision-making process has become political, especially in the U.S. Here in the home market the politicians are debating whether to continue the present difficult-to-reach CAFE (corporate average fuel economy) figures established by the Obama administration (and supported by California and 13 other participating states), which encourages the development of clean EVs and is known as “Section 177,” or whether to roll back the CAFE figures to a figure automakers can more easily attain. Presently the final CAFE debate has been turned over to the courts to decide. The position of the U.S. government at the moment can be best revealed by the words of U. S. Department of Transportation Secretary Elaine Chao, who derided EVs in a recent press conference as “cars that American consumers do not want to buy or drive.”
The automotive market is global, but it can be argued that the dominant three markers are China, the U.S. and European Union. In the U.S. the demand for EVs including hybrids and pure battery-electric models is miniscule, taking under 5 percent of the market. The numbers are small but, significantly, growing. Even though the overall market here in the U.S. has experienced a downturn, sales of plug-based EVS models have increased 5 percent to just over 200,000 units during the first eight months of this year. Looking at the EV sales numbers in other major global markets paints a very different story. According to industry data, the demand globally is rising swiftly and in several markets EVs are beginning to dominate. According to InsideEVs, a Miami, Fla. company, worldwide EV sales through the end of July this year totalled 1.25 million plug-based vehicles. That is a nearly 140 percent jump over 2018’s figures.
China, thanks to its government New Energy Vehicles (NEV) mandate, has seen demand running about 6.1 percent of their total sales in the world’s largest automotive market. Things are looking even more promising in the E.U. Sales of EVs will probably top 1 million in 2020, according to InsideEVs. Really bright sales spots in the EU market include countries like Norway and The Netherlands.
Norway holds the record for the country with the highest EV market share in the world. In 2014 EVs held 1 percent of sales. This past year (2018), 49.1 percent of Norwegians opted for an EV. Already in the first half of 2019 the share of EVs has grown to 55 percent, according to Oslo’s energy consultancy-based Rystad. An interesting side note on Norway: Norwegian EVs, because 98 percent of the country’s electricity is from non-polluting hydropower, have the world’s cleanest vehicles. I sure wish our elected representatives would make note of that amazing statistic. Another Euro country that is embracing EVs and battery power is The Netherlands. The country where bicycles nearly outnumber cars made the Tesla Model 3 EV its best selling car, displacing VW’s little gas-powered Polo hatchback in recent months.
Good news for owners of EV-maker Tesla stock: The American automaker that continues to astound the auto world with award-winning EV vehicles (but struggles to make a profit) can and should be credited with driving demand for EVs around the globe. Sales for American-built Teslas are up 400 percent so far this year in Germany, for example, and industry data shows Tesla UK sales figures putting the brand on the top five best seller list. I’m thinking most readers weren’t aware of this impressive Tesla success.
That said, it must be mentioned here that although Tesla may be EVs prime moving force in the past decade, the competition is rapidly catching up with the California-based automaker. In the product pipeline in nearly all of the major automakers are a bevy of all-new, battery-powered vehicles of all sizes and shapes. This total includes vehicles from both traditional automakers and start-ups. In fact, some are already in dealership showrooms. Nissan’s Leaf and Chevy’s Bolt, to mention just two, have been on the market for quite some time. Starting just this year with the highly regarded Jaguar I-PACE crossover and stunning Audi iTron crossover, to mention just two, the level of competition for EV buyer dollars will rise fast. In last Monday’s Auto News trade magazine, a story reported that there are 100 EVs planned for production through 2023. Whether tiny Tesla, with just one factory (with another to soon begin production in China) can stay competitive with the likes of GM, VW/Audi, Nissan and all the others with EVs on the way, remains to be seen. You can bet Tesla investors are keeping an eye on things in the months to come.
In recent years a lot of debate has swirled about regarding both the future of EVs and also of autonomous, self-driving vehicles (AV.). While it can be pretty much assumed that the day when we will all be driving level 5, totally hands-free AVs is a long way off, the same can’t be said about EVs. China and the EU is making it clear that that EV is here to stay. Can’t we compare, maybe, today’s EVs vs internal combustion-powered cars debate to the moment in the early 20th century when the argument was between the new-fangled horseless carriage vs. the horse-drawn buggy? We know who won and lost that battle. You just had to ask for an answer back in the day the out-of-business blacksmith shop owner who made and installed horseshoes.
Ironically, in last week’s Auto News it was reported that on Sept. 26, the first gas station in the U.S., located in Takoma Park. Md., removed its gas pumps from service and switched to charging stations. The Maryland owner will not be the last, and I’m pretty sure thousands of gas station owners across our land are wondering at this moment whether to take a page like their Maryland compadre.
• Trivia answer: 100,000. A number of major companies have invested in Rivian Automotive, including Amazon and Ford Motor Company. It’s rumored Ford will ask Rivian to assist with developing Ford’s first electric F-150.
Dar Davis founded the Lake Bluff Concours and chaired the event for many years. He has been writing this column since 1999. He can be reached at firstname.lastname@example.org.
How many electric, emission-free delivery vans has Amazon ordered from electric automaker Rivian Automotive?