COMMENT: Have we reached a turning point on electric vehicles?

Alyssa Altman looks at the latest developments in the electric vehicle segment

For much of the past three months, car showrooms have been shut, factories have closed and, frankly, far fewer of us have been driving. In many places, it has simply been against the rules. So it’s maybe not a surprise that the European Automobile Manufacturers’ Association (ACEA) found that in Q1 new car registrations in Europe plummeted by 52.9%, and car sales halved in the US in April.

However, these figures only tell one side of the story. ACEA also found that the number of electric vehicles (EVs) in Europe jumped by a massive 57.4%. While EVs still only represent 4% of cars in Europe, the jump in registrations during the ongoing COVID-19 pandemic showcases the increased demand in EVs and the resilience of the emerging market. In China, registrations for Teslas were up by 150% and in South Korea, EV exports more than doubled from a year earlier to an all-time high in May. In the US, a new report has found that roughly one-third of drivers have said that they might buy an EV as their next purchase, despite relatively low uptake as yet – making up just 1.44% of U.S. auto sales in 2019.

The cause behind the recent surge in EVs

While interest in EVs has grown over the last few years, the pandemic has supercharged consumers’ positive perceptions of electric vehicles. Encouraged by the cleaner air evident during the lockdown, the health crisis has shown the impact of gasoline-fuelled cars on our environment and has therefore persuaded people to use sustainable alternatives such as electric cars. According to research, 45% of drivers in the UK are reconsidering their plans for EVs due to the radical improvement on air pollution across the globe from reduced traffic. What’s more, 17% of consumers believe that the effects of lockdown on the environment have reaffirmed their decision to make the switch to an EV.

While EVs still only represent 4% of cars in Europe, the jump in registrations during the ongoing COVID-19 pandemic showcases the increased demand in EVs and the resilience of the emerging market

However, in the US, despite drops in car traffic, air pollution levels have barely shifted as trucks and city factories continue to clog the air. This might help account for the US’s lower interest in EVs, and Bloomberg’s forecast that it will lag the global economy in EV uptake. Of course, low fuel prices alongside a lack of governmental support for EVs may also contribute. The rest of the world is looking more ready for the EV, however, and the current crisis has fuelled the interest. This could have a long-lasting effect on the industry going forward. Global sales of electric cars are predicted to jump by 36% and top 3 million vehicles for the first time ever next year. Meanwhile, production of EVs is set to rise by at least 1.3 million and could reach 1.5 million depending on market conditions this year.

The barriers towards full adoption

The recent surge in interest in EVs, however, doesn’t mean that we have reached a turning point in EV adoption. A significant number of consumers in the UK, for example, are still sceptical about the practicalities of EVs.

A major barrier to adoption for EVs remains the lack of charging infrastructure. Research has found that consumers suggest not having enough access to efficient charging stations is the third most serious barrier to EV purchase, behind price and driving range. With EV prices set to fall and ranges set to expand following the release of new models, charging could soon become the number one barrier.

Without the proper infrastructure in place, EVs will fail in achieving mass adoption

Increasing the number of electric car charging points is paramount to mass adoption of EVs. In the US, the International Council for Clean Transportation (ICCT) found that the country needs to increase the number of charging points by 400% over the next five years to make EVs work at scale. Similarly, the ACEA found that Europe needs a 20-fold increase in charging points over the next 12 years in order to meet its EV demands.

Thankfully, automotive companies and governments have slowly started to realise that they need to install more charging points to support EVs. In recent weeks, Volvo has announced a partnership with Plugsurfing in Europe and reports have shown that the charging points in the UK grew by 60% in 2019. It is imperative that governments work more with private companies in order to help create the conditions for EV adoption to reach a turning point.

Without the proper infrastructure in place, EVs will fail in achieving mass adoption. While COIVD-19 has spurred interest in EVs and cities across the world recognise that infrastructure must be updated in order to support a greener economy emerging, authorities must go much further in order to help persuade consumers to switch from gasoline and diesel powered cars to EVs.

The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.

Alyssa Altman is Transportation Lead at Publicis Sapient

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