EVs are ubiquitous these days. I even see them daily here in West Texas – the home of “thole binness” (translation: the oil business). They are generally considered a bright spot and success story in the transition economy and winning over consumers from fossil fuels. Ah, but maybe not as much as it seems. CarScoops.com wrote about a study from S&P Global Mobility that found:
“it’s difficult to keep EV owners exclusively committed to electric vehicles. Indeed, with the exception of Tesla owners, almost half of EV-owning households will purchase an internal combustion vehicle next…. the study notes that its data doesn’t mean that roughly half of EVs are going to be replaced by a combustion vehicle. Instead, a household’s next purchase could be a replacement for a different vehicle they already have.”
The EV market is changing almost as I write this. EV prices are heading down, which is necessary for EVs to become affordable enough for an average buyer. Luxury brands normally immune to price pressures are feeling the heat for their EVs – Audi is offering $50,000 in lease discounts (!!!) for one of theirs. Rule changes for federal tax credits give buyers instant credit off the purchase price.
Demand, however, is softening as might be expected in a period of price softening and improved incentives. Two days ago, The Hill reported “General Motors will delay electric pickup truck production at a factory near Detroit due to slowing U.S. demand for electric vehicles.” Lucid Group “posted a near 30% drop in third-quarter production and a marginal rise in deliveries despite big discounts, raising worries about demand for its Air luxury electric sedan and its ability to make 10,000 cars this year,” according to Reuters yesterday.
The transition to EVs plays a large part in net-zero planning – corporate and otherwise. The federal government is relying on the EV market to pick up steam to meet its goal of 100% zero-emissions vehicle acquisitions by 2035. If EV production stalls out and demand diminishes, then continued growth of EV uptake is in doubt. Decline in demand for EVs and the lingering desire among consumers for internal combustion engines may throw a wrench into current climate management projections. This is also a cautionary tale for companies – consumers are fickle and it isn’t easy to change our established ways of thinking. Shocking…
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