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Electric Vehicle (EV) Sales Swoon – Easy Remedies

By February 17, 2020November 5th, 2021Energy Rant
electric vehicle (EV)

The electric car (or vehicle / EV) may be the most captivating technology of my career. I panned EVs ten years ago with a Frivolous Novelty[1]. I implore you to go back and read that. Almost nothing has changed in ten years!

The iPhone launched 13 years ago. Everyone has an iPhone or an iPhone wannabe. By contrast, the EV has gone from zero to 0.02 in the same period.

This week I will cover market challenges and pain points. Next week, we will look at some mitigating solutions, some of which are stupendously simple.

The Wall Street Journal reports that global automakers will invest $250 billion in the development of EVs over the next three years. Seventeen all-electric vehicles were on the market last year, and twelve more will be added this year. The New York Times reports 100 new plug-in models will be introduced in the next five years (may include plugin hybrids).

That’s swell, but here is the reality as reported by the Times: EV sales in 2019 were lower than in 2018. Gulp. And Tesla accounted for more than half the sales volume. This is confirmed by ev-volumes.com.

Holman Jenkins from the Wall Street Journal notes that “cars designed in part for compliance purposes [EPA fuel mileage standards] have a hard time finding their way into customers’ hearts.” No kidding. This, I wrote about in Prestige, Not Pain, several months ago, when I described that small car models are disappearing – and according to the Times and the Journal, those models are being replaced by electric versions of similar stature.

The Auto Executive?

Do you understand automotive executives? I do not. I can envision an executive’s presentation to a board of directors: “Our strategic plan for the future is to replace our fleet of small gasoline-driven, fuel-efficient cars with electric cars that cost $15,000 more per unit. This is our vision for the future.” To this, the General Motors executive can add that, “We have an even better idea – an electric Hummer – to build on the success of our gasoline-powered line of Hummer products.[2]” I wish there were a way to short bet against that $250 billion that will be invested.

electric vehicle (EV)

EV Awareness

Now here is something that will knock your socks off, taken directly from the Times article linked above. Although EVs have been around as long as the iPhone, people don’t know anything about them. Sixty-seven percent of Californians cannot name a battery-electric vehicle on the market in the United States. Wow!

Jenkins (The Wall Street Journal) reports that Roger Penske is ticked off because he is stuck with 30 “highly touted” Audi E Tron SUVs which were abandoned on his properties via customer cancellations. But not all is lost. Jenkins reports that consumers don’t want EVs. They want a Tesla. It’s hard to argue with that.

The Thrill is Gone

Here’s the thing – inventions like cars, iPhones, PCs, and the LED bulbs reach market saturation, and the urge to buy the next one is limited to things such as:

  • I want to try a different model for a different experience.
  • My current one died or is no longer supported by the manufacturer.
  • I accidentally dropped it in the toilet.

When was the last time you were excited to get a new laptop? I distinctly remember getting a svelte 12 inch Dell that was lighter than what have today, 3-4 computers, and at least ten years later. This is where cars are today. Of the dozen or so cars I’ve bought over the years, the 2003 Acura RSX remains my favorite. No contest.

I haven’t been in new cars for eons, but for many years, everything that matters is standard: fuel injection, air conditioning, wishbone suspension, the audio system, excellent speakers, cruise control, a quiet ride, and power everything.

A Thought Experiment

For comparison, let’s say it is discovered that lithium batteries in your laptop are demonstrated to be radioactive at the end of their useful life. They haven’t harmed you, but they are irredeemably toxic for hundreds of years. Would you give up the independence and mobility of your battery laptop instead of a battery-free option that you have to shut down and reboot every time you move from one place to another? It can be done. It’s not the end of the world.

For the general population, the non-EV enthusiasts who just want to get from A to B, this is what the EV market has to overcome. Consumers have to be convinced to switch from something they don’t have to manage at all – a fuel tank to something that needs to be managed. They have to plan their transportation around their car battery. For instance, a real example: “I’m in the EV penalty box because I forgot to plug in my car last night.” That is a one-line true story of a business partner of ours as we connected for a video conference not long ago. So spare the “it’s easy,” replies. There it is.

There have to be compelling reasons to overcome these hassles if EV sales will ever exceed the market penetration of indoor/outdoor home swimming pools. We’ll get to that next week.

[1] I kinda cornered the market on this phrase.  Google it.

[2] Which lasted for three years after which it was discontinued, GM filed for bankruptcy, and the brand was sold to a Chinese company for quarter.  A quarter of what, you ask?  A quarter.  Twenty five cents.

Jeff Ihnen

Author Jeff Ihnen

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