BATTERY ELECTRIC VEHICLES ARE NOT THE SILVER BULLET
Research in the United States has shown that emission savings from battery electric vehicles (BEVs) might be overestimated. It seems that for some or other reason EV owners drive less than they did when driving a car with an internal combustion engine (ICE), while regulatory bodies probably assumed the driving distances – and hence opportunities for emissions – would be similar.
The study, Quantifying Electric Vehicle Mileage in the United States, was one of the largest to date involving EV usage. The National Renewable Energy Laboratory examined the odometer readings of 12.9 million used cars and 11.9 million used SUV’s between 2016 and 2022.
The survey found that BEVs were driven almost 4 500 fewer miles than ICE cars in a year. There was a split between cars and SUVs. In the case of cars, it was 7 165 miles covered annually in a BEV car and 11 642 miles in an ICE car. In the case of SUVs, the BEV models travelled an average of 10 587 miles annually versus 12 945 miles for SUVs with ICE.
A factor affecting drivers of BEVs is a lack of a reliable charging infrastructure which may limit drivers tackling long distance drives. The study’s findings also have implications for the electricity grid as it means anticipated electricity consumption from EV adoption may be lower than the electricity utilities are using in their planning.
This in-depth study on EV usage is another shock for legislators.
The unprecedented rush to transition the global motor industry from vehicles with internal combustion engines to those with battery electric motors as an energy source is meeting strong headwinds and hitting hurdles as global sales of EVs slow dramatically.
A big shock came as long-time “flavour of the month” Tesla, which makes and sells only battery electric vehicles (BEVs), saw its share price tumble to the extent that they lost nearly 20% of their value in less than two weeks. This came amid growing concerns that demand for electric cars is starting to weaken. The fall in the share price took about US$145 billion from the company’s market capitalisation.
Sales of BEVs in Europe have been reasonable, but sales in the huge US market are hitting speed bumps which will have worldwide repercussions. Sales of battery electric vehicles in the US have stalled and made up only 7.7% of light vehicle sales in September 2023. EV dealer day’s stock levels in the US at the end of September were almost double that for cars with ICE power units: 100 days vs 57 days.
Companies which have invested heavily in a hoped-for, enthusiastic EV transition by consumers are getting jittery. These are not only motor companies. Battery suppliers like Panasonic and ON, a major supplier of semi-conductors, are also sounding alarms for the EV industry. Panasonic cut its EV battery production in Japan, by 60% in the third quarter, when compared to the third quarter of 2022.
Analysts are saying the problem is that the automotive industry is a capital-intensive sector that is investing in unproven EV strategies in a world of economic turmoil. The early adopters have bought their EVs already and the high cost of EVs, range anxiety and unreliable charging networks are all putting a brake on the ordinary consumer forking out a substantial amount of money for a new EV. Fitting a home charger is another big expense for EV buyers.
Harald Wilhelm, Chief Financial Officer at Mercedes-Benz, is reported as saying the EV market is a “pretty brutal space” and hinted that some manufacturers may not survive, “I can hardly imagine the current status quo is fully sustainable for everybody,” he said.
Another worrying article is one detailing the Hertz rental company’s disenchantment with EVs. It says it is now slowing its uptake of EVs as they are proving expensive to repair with low resale values. Hertz global CEO Stephen Scherr told CNBC that collision and damage repairs often run to about double the cost associated with an ICE vehicle. About 80% of Hertz’s EVs are Teslas, while EVs make up about 11% of the total fleet.
Everybody knows that China has ridden to the crest of the wave as the world’s largest vehicle manufacturing country – by far – on the back of electric vehicles, many of them made and bought with the aid of Chinese government subsidies. There have been huge numbers of different models on offer too. One source quotes a figure of 1 224 domestic start-ups originally wanting to ride on the EV boom. The vast majority have gone bankrupt and from about 500 registered EV makers in 2019 the figure now is about 100 companies.
However, economies of scale have enabled the Chinese companies to keep costs down and they are making big inroads into a growing number of export markets, including Europe, because of affordable pricing.
Meanwhile, Toyota the global market leader, and most of the other car makers that comprise the unofficial Japan Incorporated – including several with links to Toyota – have been, basically, sitting on the sidelines watching developments. They have not been idle though. Instead, they are investigating other ways of reducing their carbon footprint, using other methods, from hydrogen, to natural gas and ammonia, e-fuels, biofuels and the like while selling millions of traditional and plug-in hybrid vehicles.
“The reality of EVs is becoming apparent,” Toyota Motor Corporation Chairman, Akio Toyoda, to the media at the recent Japan Mobility Show. Toyota is certainly building BEVs, but on a comparatively small scale and will sell only about 120 000 units in the current fiscal year.
Story by: Roger Houghton