The Future of The Electric Car Industry
In the past few decades, especially in the last 10 years, environmentally friendly technology, also known as green technology, has become increasingly prevalent. From the smallest inventions, like reusable straws, to changes in the sources of materials for cosmetic products, to policies that mandate or encourage environmentally friendly practices. Many have been pushed on by the increasing threat of climate change, which threatens modern societies in a number of ways. Governments and people alike consciously have been trying to cut their carbon production, one of the main propellants of global warming.
Cars have been one facet. Ubiquitous in nature, across the world, in many shapes, they are the basis of transportation. They are one of the greatest inventions of the modern era, speeding up regular tasks at an unparalleled extent. Since the birth of the modern car in 1886, its design has become revamped and updated to fit with the rapidly moving world. Speed has increased dramatically, from 10 mph to over 140 mph today. Across the world, there are 1 billion cars. Once only an American or European privilege, they have reached the most impoverished areas in the least developed countries.
However, the fuel source behind them is just as important : gasoline. An oil & gas industry surge in the United States coincided with cars becoming more accessible to the public at the start of the 20th century. With rapid migration came rapid drilling to equal the rising demand. However, as the world progressed through the 20th century and into the 21st, the industry diversified to other sectors such as manufacturing, power, etc. Today, passenger vehicles account for over a fourth of global oil consumption, which equals 9.2 billion gallons per year.
However, recent events have made us waver in our choice to use gas as the main fuel for passenger vehicles. Particularly in the United States, it’s become an issue.
In 1973, when the country imported most of its oil from the Middle East, and subsequently OPEC, it became extremely vulnerable when an embargo was enacted by the supranational organization. Gas prices rose to unprecedented heights, quadrupling, stalling the economy, and costing the country billions of dollars. After, the United States became a major exporter of oil to prevent a scenario of dependence from occurring again. However, during the pandemic, a gas shortage happened due to logistical delays, which caused gas prices to soar to their highest in a decade. Now, records are being broken again as the Russo-Ukrainian War rages on, causing record inflation and the highest gas prices of the 21st century, reigniting the debate of electric vs gas. Gas has been the standard for over a century, though now with new efforts to battle climate change and new government policies, many are turning electric.
Tesla has been the driving force in the whole endeavor. It rose to popularity before the pandemic, and will continue to grow not only because of more markets, but because of favorable policies, environmental consciousness, and changing consumer ideals. It has dominated the market in the United States and Europe, with 79% of the U.S electric car market, 31% of the European electric car market, and 16% of the global electric car market ( all regions where it’s 1st in market share ). Particularly in developing regions such as Southeast and East Asia, it’s becoming more popular as the middle class becomes more wealthy.
As Tesla has had massive gains in sales and popularity, more and more primarily gas brands have made an effort to switch to electric/renewable energy vehicles. Mercedes-Benz, BMW, Ford, Mazda, Nissan, Volkswagen, Audi, and Acura have all started to produce electric, plug-in vehicles in the next decade as well as major investments in electric research & development.
Tesla was the pioneer in the electric car industry, but may be soon overtaken by bigger and more historic brands soon. As many of these car brands are headquartered in developed, European countries like Germany, as well as the Ruhr Valley being the epicenter of manufacturing in Europe, the electric car may dominate the continent’s roadways soon. The path to that is much easier in Europe than it is in North America as many of the governments have had renewable energy plans earlier as well as huge investment in renewable energy. The majority of France’s energy is nuclear, which is an alternative fuel source to gas. In addition, as most of Europe is in the European Union, current and future favorable policies toward electric vehicles will be widespread and influential to the future of transport there.
However, the United States and Europe may not be the biggest players on the electric scene. Currently, China leads the world in global electric car production, and will continue to exponentially develop the EV market there at unprecedented rates. According to the New York Times,
“China will be making over eight million electric cars a year by 2028…Europe is on track to make 5.7 million fully electric cars by then.”
Though the United States may be the home of Tesla, Europe and China are leading the world in EV production. Given the tensions between China and Western and developed nations ( mainly US and Europe ), the EV market may become a battleground for diplomacy and politics between the two regions.
In the United States domestically, the EV market is poised for a major surge. President Joe Biden’s Green New Deal as well as Congress’ Climate Crisis Action Plan is aimed to reduce carbon emissions, especially in vehicle industries. The plans are supposed to encourage and facilitate increased manufacturing and deployment of electric passenger vehicles across the country. A plan substantially including that hasn’t been proposed or passed ever in recent history, though with the industry rapidly growing in other countries across the globe, the action comes at a very good time.
Though there may be a race between countries, there is still competition between the choice of gas or electric vehicles. One of the biggest and most influential advantages that EVs hold is the reduction of the consumer’s carbon footprint. In markets like the United States, the ability to bargain using the consumer’s conscience yields great results economically. Beyond the “feel-good” effect of driving an electric car, there is less maintenance involved, lower fuel costs, and overall more convenience. More developed markets, especially those with service economies run on convenience. People will buy things that make life easier for them, and that for many, is one of the biggest benefits of an electric vehicle.
However, there are some negatives : longer charging time, lower range than gas vehicles, less models to choose from, and the scarcity of charging stations. Because electric vehicles have just started to become a staple in the car market, the amount of EV models are a fraction of those of gas vehicles’. The longer charging time is somewhat of a trade for cheaper refueling, though the charging time is much longer than that of a gas vehicle; charging fully takes a matter of hours, while gas refueling takes a matter of minutes. However, electric vehicles can be charged both at charging stations and at home, which is a comfort gas vehicle owners do not enjoy.
The scarcity of charging stations is the biggest con, and it’s a very complex issue. Charging infrastructure in the U.S is dwarfed by numbers in Europe. There are 42,000 public stations in the United States, though only a fraction are the most efficient model. In Europe, there are around 286,000 stations, and the European Union is rapidly deploying charging infrastructure across its member countries’ territories. When considering issues in the U.S, one is on a regional scale. There are much more charging stations in California than in Texas, though they are two of the biggest and most economically developed states in the United States.
That comes down to a matter of preference and the regional economy. California advocates much more for green technology and other liberal legislation that substantially includes environmental protection. In Texas, especially in the largest city in the state and the 4th largest in the country, Houston, it is easy to see why there is a deficit. As the energy capital of the world, oil & gas is a major growth pole there, with a large portion of tertiary jobs being in that sector. More resistance to electric vehicles, which take profits away from oil companies, and therefore from many citizens there, is understandable.
It isn’t a regional divide across the country, it is more of an economic one. It depends on what the region’s economy runs on and if it affects what the preference for gas or electric vehicles is. The same is not only true in the United States, but across the world, in places like Russia. Though they may have resistance to it now, as electric cars become the norm, it will steadily supplant gas vehicles even in places it was rare to see before. Even the Middle East, where oil is practically a religion, is starting to go electric. Though it can hurt their economy, they are turning to it to keep up with other developed regions as well as to combat pollution caused by traffic congestion there.
Electric vehicles are the future of transport. As much as they are positive environmentally, they will have a plethora of economic, political, and social effects that will change society, the global economy, energy, and especially transport for the future.
