Electric vehicles have been on an upward trend. Signs point to an even brighter futureImage by Vauxford on Wikimedia CommonsIn 2020, electric vehicles
In 2020, electric vehicles (EVs) had a great year. Globally, they represented over 4% of new vehicle sales for the first time ever and have exhibited strong growth year-over-year.
While the progress we’ve seen is impressive, there are several factors that will accelerate EV growth even further. Sooner or later (more likely sooner), EVs are set to overtake gas cars and become the future of personal mobility.
1. Growth of Charging Infrastructure
One of the main impediments to EV adoption is a lack of charging infrastructure: road trips were often difficult, and if you couldn’t charge at home, EV ownership would be difficult. However, things are changing. Public charging stations are growing at an exponential rate.
Most of these charging stations are slow chargers; typically placed at stores, restaurants, and other public places so people can charge while they go through their daily activities.
Others are fast chargers, which give power at a much quicker rate. These stations are typically situated near highways and are used for quick charges on long-distance trips. While it varies both by charger and by vehicle, some of these charges can fill most of a battery in about twenty minutes. Both types of chargers are important for the future of EVs.
This only encapsulates chargers that are available to the public; chargers installed by individuals at homes and workplaces are not included. As EV adoption picks up, chargers in apartment and condo buildings will become increasingly important.
2. Increases in Range
When EVs first came out, ranges were very limited. The Nissan Leaf, the most popular of the early models, had an EPA-rated range of 73 miles — hardly enough to leave the city, much less plan a road trip of any kind.
Now, ranges are far more impressive. A recent survey by AutoList indicates that well over half of people would be content with a 300-mile range. Today, the best selling EV is the Tesla Model 3 — which offers a 263-mile range on the base version and a 353-mile range on the long-range trim. Some higher-end vehicles arriving in the near future should clear 500 miles of range. EVs are now capable of offering more than enough range for the majority of people. As charging infrastructure increases, most people that believe they need more 300 miles will likely find that they can easily get by on less. Range is becoming less of a barrier to EV adoption by day.
3. Decreases in Battery Costs
At this point, the high initial cost of EVs is likely the single most important factor in increasing EV adoption. In a survey of potential EV buyers from McKinsey & Company, the most commonly cited concern was high purchase price (25%), followed by range (24%), and charging availability (18%).
EVs remain costly compared to gas-powered vehicles, but there is hope on the horizon. Batteries have fallen in price by 89% in the last ten years according to BNEF, and they continue to trend downwards. By 2023, BNEF estimates that battery costs will be close to $100/kWh, a mark that is widely anticipated to make EVs cost competitive with gas cars. To this point, EV manufacturers have largely directed the cost savings towards increasing range. However, as the range of EVs is now reaching a tipping point on acceptability, automakers should begin to produce more affordable cars with ranges of 250–300 miles. Analysts from UBS conducted research into seven battery cells and have estimated that EVs should reach price parity with conventional vehicles by 2024, just a few short years away.
4. Increasing Selection
In the early days of EVs, almost all EVs were small cars; often compacts or hatchbacks. The Tesla Model S was a noted exception, but EVs remained unrepresented in many segments of the market.
Today, a much wider variety of EVs is available. First, many mid-sized and large sedans came out. Recently, we have seen several entrants (including the Hyundai Kona EV, Kia Niro EV, and Tesla Model Y) into the very popular crossover segment. Sometime this year, we should see very first electric pickup trucks come to market as well. Soon, buyers in every segment should have a good long-range EV available as an option.
5. Tightening Regulation
Tightening regulation in many countries is also working to promote EVs. The European Union recently introduced stricter fuel standards, forcing manufacturers to sell more EVs in order to keep their average fuel economy low. As of November 2020, EVs made up more than 10% of vehicle sales in Europe, with all-electric vehicles making up more than 5% on their own.
Climate change remains a global issue, and the road transportation sector remains a large source of emissions. Whether governments adopt tighter fuel standards, carbon prices, or direct subsidies, EVs are sure to be a beneficiary.
6. Untapped Markets
Lastly, despite tremendous progress, there remains markets that have been virtually untouched by the EV revolution. The largest of these is India — the second largest country by population and the fifth largest market by vehicles sold. Per the most recent update, electric vehicle market share was below 0.2% in the country.
However, it looks like that’s about to change. The Indian government is aiming to turn 30% of vehicles sold electric by 2030 — which will require a major push considering the low starting point. However, the market should get a solid boost as Tesla (the largest EV manufacturer globally) is reportedly looking to enter the market at last.
Of course, there is no telling exactly how successful EVs will be in India (and other relatively untapped markets) over the coming years, but they really have nowhere to go but up at this point.
7. Less Maintenance
At their core, EVs require less maintenance and repairs. Consumer Reports estimates that EVs will save a typical owner about $4,600 compared to a gas car over the lifetime of the vehicle. Not only does this save money, it also saves the owner time.
The reduced maintenance and repairs represents a nearly untouchable advantage EVs hold over traditional gas cars.