Hottest Cars This Year
As automakers increasingly rely on electric vehicle technology, many industry analysts debate a key question: how quickly can they reach the masses? It is commonly thought that electric cars will continue to be a specialized product for many years, with high selling prices. However, now more and more analysts argue that this pessimism is becoming outdated. A new report from the Bloomberg New Energy Finance research group suggests that the price of electric vehicles is going down much faster than expected, thanks to cheaper batteries and energy policies that promote zero-emission cars in China and Europe.
According to the group’s predictions, between 2025 and 2030 the cost of electric cars will become competitive with respect to vehicles that use gasoline, even without subsidies and before taking into account fuel savings. Once this happens, adoption by the masses will be the immediate consequence, says the report. “Our prediction does not depend on countries adopting new and rigorous standards for fuels or climate policies,” said Colin McKerracher, the head of advanced transportation analysis at Bloomberg New Energy Finance. “It’s an economic analysis that studies what happens when the initial cost of electric vehicles reaches parity.
At that moment the real change happens. ” If the prediction is correct, it will have enormous consequences for the automotive industry, the oil markets and global initiatives to stop global warming.
The Impulse of the Batteries:
Last year, electric cars accounted for less than one percent of sales of new passenger vehicles worldwide, held back by high initial costs. However, there are signs of a change. Tesla and Volkswagen plan to produce more than one million electric cars per year by 2025. Volvo has already announced that it will gradually eliminate the traditional combustion engine and that all its new models starting in 2019 will be hybrids or will operate exclusively with batteries. Skeptics claim that most of these changes are insignificant. Exxon Mobil, which studies the threat that electric cars could pose to its business model, projects that sales of hottest cars this year will slowly increase until they reach only ten percent of net sales in the United States alone by 2040, without that is going to have a lot of impact on the consumption of gasoline around the world. The prediction of Bloomberg New Energy is much riskier because it projects that hybrid and all-electric cars will make up 54 percent of new sales of light commercial vehicles around the world by 2040, so they would exceed the sales of models with the motor of combustion.
The reason for this projection is batteries. Since 2010, the average cost of lithium-ion batteries has dropped by two-thirds, to reach $ 300 per kWh. The Bloomberg report estimates that it will go down to 73 dollars by 2030, without any significant technological advances, as companies such as Tesla increase the production of batteries in massive factories, optimize the design of batteries and improve their composition.
During the next decade, the report says, electric cars will continue to depend on government incentives and promotions for sale in places like Europe and China. However, as automakers present a wider variety of models and lower prices, electric cars will reach a point where they will not depend on those factors. Even so, the result is not guaranteed. Governments could eliminate incentives before electric vehicles become fully competitive … many states are already beginning to tax them.
Battery manufacturers may face shortages of materials or production problems that undermine their ability to lower costs. In addition, an unforeseen technological failure, such as the widespread explosion of batteries, could stop progress. “But we try to be quite conservative in our calculation of what direction the battery prices are taking,” McKerracher said, “and we do not believe there are any obstacles to electric vehicles becoming competitive over their cost in a short time.”
Other experts warn that the drop in battery costs is not the only factor in determining whether electric cars will reach the masses. Sam Ori, executive director of the Institute of Energy Policy at the University of Chicago, said: “People are not only based on the price of buying cars.” Consumers could remain cautious with limited-range vehicles that take hours to load. Although researchers have shown that electric vehicles with batteries have enough capacity to satisfy the daily transportation habits of many people, consumer psychology is still difficult to predict. The report, for example, does not expect electric vehicles to become widely popular in the picop truck market.
The charging infrastructure is another potential barrier. Although cities are beginning to install thousands of public charging stations – and Tesla is working to reduce the charging time of a discharged battery – it still takes more time to charge an electric vehicle than to refuel a conventional car at the gas station. Many owners load their cars at night in their garages, but that is much more difficult for people who live in cities and park their cars on the street. As a result, the Bloomberg report warns that electric vehicles may have difficulty getting around streets in dense urban areas and that infrastructure obstacles could slow the growth of electric vehicles after 2040.
Another potential obstacle could be the car manufacturers. Although most manufacturers are introducing electric models to meet stricter fuel economy and fuel consumption standards, they do not always market them with much impetus, said Chelsea Sexton, an automotive industry consultant who worked on the electric vehicle program. General Motors in the nineties. Car dealerships also remain reluctant to show and sell electric models, which often require less maintenance and are therefore less profitable for their service departments. Surveys have found that sellers are often not prepared to promote cars. “We have seen many announcements of electric vehicles, but that does not matter much if the automakers are building them just to comply with the regulations and they are not enthusiastic about their commercialization,” Sexton said.