Electric cars are coming — at least that’s what we’ve been told since about 2007. Sure, they’ve come. There’s been the Nissan Leaf, the Chevy Volt, and who can forget about the entire Tesla brand.
But when they’ve come, while they’ve garnered a lot of press, they haven’t amounted in very many sales. In fact, it’s estimated that electric cars only represent about 2 percent of the total American car market and about 2.2 percent of the overall world automotive market, per data from QZ. To put this into context, this means that only about one of every 250 cars on the road these days is an electric one.
What’s more is that the Trump Administration rolled back the CAFE fuel economy goal the Obama Administration set to ensure that passenger cars and light-duty heavy trucks increase fuel economy to 54.5 miles per gallon by 2025. So with less regulation on automakers, there’s less urgency for them to develop truly fuel efficient vehicles and zero emission vehicles. This is all just a long-winded way of saying that if electric vehicles are going to be a major part of the automotive future, consumers are going to have to start buying them and demanding them. And according to a new report from Bloomberg New Energy Finance (BNEF), that day could be coming sooner rather than later.
Specifically, BNEF has predicted that 20 years from now, there will be an even mix of electric-powered and gas-powered vehicles on the road. But in order for electric vehicles to outsell gas-powered vehicles, BNEF admits that a few things need to happen first. Let’s take a look at them here:
According to automotive experts, in order for electric vehicles to become mainstream, two things first need to happen. One, EVs need to average about as many miles before requiring recharge as a conventional car would on a tank of gas. And two, automakers need to provide more options.
Let’s focus on the first thing — getting greater range on a battery charge. Right now, the Nissan Leaf is among the leading EVs on the market, and it’s able to achieve about 125 miles in the city and 99 miles highway before recharge is necessary. It’s estimated that the average American drives about 30 miles per day, which is well within this range. But still, what’s a family to do when driving to a vacation destination, where hundreds of miles may exist between their origin and final stop?
Many Americans have “range anxiety” when it comes to driving EVs. That is, they aren’t confident that the battery will be sufficient for their driving needs. But this could be changing. Technology is becoming better, and batteries are storing more energy. They’re also becoming cheaper to produce, another key factor that could influence electric vehicle future. Within 10 years, automotive analysts predict that EVs will average about 300 miles in between charges, a number that will certainly ease range anxiety.
Now on to the second influencing factor: demand. Right now, there’s not much demand for electric vehicles, largely because there are only a handful of models available today. But that too could soon change, especially as technology improves and batteries become cheaper to produce. If electric vehicles can be purchased at a similar price point as their gasoline counterparts, and if range anxiety is no longer an issue, it would make sense for automakers to invest more into developing a wider range of options. And as electric vehicles become more popular, so will the public infrastructure that’s needed to sustain battery charges. While many businesses, public spaces and employers have installed battery charging stations, most consumers that own electric vehicles still charge them only from their home garage.
An electric vehicle that gets 300 miles per charge and is cost comparative to a gas-powered vehicle? Does that sound like something that you would eventually opt for over an internal combustion engine? According to BNEF, the day when a majority of consumers prefer EVs to the conventional vehicle is not far off. Are you ready for it?
Regards,
Ethan Warrick
Editor
Wealth Authority
