EV sales are growing. So why are automakers getting cold feet?
EV sales are growing. So why are automakers getting cold feet?
From Ford to Mercedes-Benz, major automakers are walking back aggressive electrification goals they set just a few years ago.
ie they ignored several decades of climate science and now we all get to pay the price.
can't compete with chinese automakers on price, performance or access to batteries so now they are retreating to their protected markets.
Plug in hybrids make a lot of sense during this transitional period of rapidly advancing battery technology and incomplete deployment of charging infrastructure.
Building a small, relatively cheap factory for manufacturing a small number of super expensive, pavement princess trucks is less risky than making a large investment in a megafactory capable of producing a meaningful number of affordable cars. That big car factory would need the market to demand its products for a long time for the investment to pay off. For example, if there's a big leap in battery tech in the near future, the car manufacturer would take a loss - either they continue to offer outdated EVs and sell fewer than projected (only utilizing a fraction of the factory's maximum output, while still paying taxes and maintenance on a larger facility), or they throw away their expensive, brand new factory tools and build expensive new ones for manufacturing cars with the new batteries.
Meanwhile, charging an EV at home still isn't possible for a lot of people, and quick charger stations aren't available yet in a lot of areas. However, a plug in hybrid can be adequately charged overnight by a standard home electrical outlet, letting it act like an EV for quick trips around town. Meanwhile, longer trips into not-yet-electrified areas are still possible thanks to the ICE, and the range can be quickly topped up at a gas station. More plug in hybrids on the roads also generates demand for building charging infrastructure - if someone just has $5 to spend on gas, they could get more miles by spending it on electricity at a quick charger.
Honestly plug in hybrids are the worst of both worlds.
There was a study recently from Europe that found the vast majority of people with plug in hybrids hardly every plugged them in, and drove them like normal cars. That defeats the entire point of a plug in hybrid, and now you are carrying a heavy battery everywhere that you are not fully using. Which makes the car less efficient than a normal hybrid!
Yeah, it depends on the user.
I had an alcoholic neighbor with learning disabilities who had a PHEV minivan purchased for them, and they only kept the battery charged for the first few months of ownership. After that, they seemed to lose interest in plugging it in when they got home.
On the other hand, a friend of the family owns a PHEV sedan they keep charged religiously, and they need to buy fuel stabilizer because they almost never use any gas.
Not necessarily. In our case, we have a hybrid SUV that we’ve used on several road trips, however most of the driving is within the 40 mile range. At the time, there was no plug in hybrid option, but if there was, it would have been perfect. Battery for most daily driving, but no range anxiety for any road trips.
Have automakers gotten so used to fat profit margins from SUV sales, particularly during the post-pandemic boom, that they consider anything that requires investment to be "insufficiently profitable"? Or has the high-return mindset of Silicon Valley infected Detroit as well?
Indeed,
"Ford just reported a massive loss on every electric vehicle it sold"
https://www.cnn.com/2024/04/24/business/ford-earnings-ev-losses/index.html
At least in Europe, there are a few big reasons. First and foremost combustion engines are more profitable. EV require a lot of R&D and factory investment, which is not needed for old school combustion engines. The other part is a shrinking car market. Covid means a lot more work from home and at least in Europe, you generally have the option of doing a lot of things on foot, bicycle or public transport. At the same time, when you drive less you do not go for a new car as quickly. Then you have cost. Due to supply chain issues battery prices have not fallen quickly enough. There was a bit of time, when they were stable. Good news is that they are falling again.
In other words, this is a difficult transition and some car makers are going to fail.
And the world will be better for it.
Spending 20% of MSRP on incentives is not profitable or sustainable