THE CHALLENGES OF WIDESPREAD USE OF ELECTRIC VEHICLES

(Article published in Automotive Innovations magazine, June 2023)

By Anne Bourgoin

While the shift to electric vehicles (EVs) is now a certainty, many challenges remain before we see a transformed vehicle fleet in which fully electric vehicles will represent a significant share, reveals a report on the aftermarket industry by Lang Marketing.

EV sales are doing well, in fact, very well. According to preliminary data collected by LMC Automotive and EV-Volumes.com, 7.8 million EVs were sold globally in 2022, a 68% increase over 2021. They now represent 10% of the global new vehicle market. A first according to the Wall Street Journal and a surprise for many. For example, the International Energy Agency predicted such a figure for … 2030!

Major challenges

In its report on the aftermarket, Lang Marketing points out that six major challenges await EVs: customer acceptance of a significant change in the vehicle fleet, charging infrastructure, the shortage of chips and batteries, dependence on rare earths and the possibility that these vehicles may have multiple owners. “While some of these challenges are likely to be short-lived, others will persist for the rest of the decade and, perhaps, beyond.”

Demanding governments

Accounting for 80 percent of EV sales in the U.S., Tesla dominates the market. Auto producers have their work cut out for them to catch up with their main competitor and win over non-Tesla consumers. On the government side, expectations are high. In Canada alone, the government has introduced draft regulations that will require at least 20% of new vehicles sold to be zero-emission vehicles. This percentage will increase each year, reaching 100% by 2035. There are penalties for manufacturers who fail to meet the targets under the Canadian Environmental Protection Act.

Shortages and rare earths

The shortage of computer chips is already a problem, and it is a situation that is not likely to improve. But perhaps the most challenging issue is the shortage of batteries. According to experts cited in the Lang report, between 2022 and 2029, it will reduce global EV production by more than 20 million. As for rare earths, in addition to being difficult to find in large quantities, their production is concentrated in China. “If offshore rare earths were suddenly denied to the U.S., domestic EV production would come to an abrupt halt,” the report states.

Will EVs be able to move between different owners?

One question now is whether EVs can last long enough to be passed on to a second or third owner. “Internal combustion engine vehicles have proven to be very durable and easy to repair. It remains to be seen whether EVs will be able to meet this same market need for the wide range of secondary buyers in the U.S.,” the report says.