“Allen Brooks writes in his Energy Musings newsletter, we are told the EV revolution is successful”, by Doug Sheridan
For EV cheerleaders, sales are advancing. But EV manufacturers continue to lose money, cut their future manufacturing plans, and are emphasizing plug-in and regular hybrid vehicles instead.
Allen Brooks writes in his Energy Musings newsletter, we are told the EV revolution is successful. Some point to EV registrations in June outpacing the rest of the light-vehicle market and reaching 8.9% of sales, but the growth was achieved with more model choices and heavy discounts.
For EV cheerleaders, sales are advancing. But EV manufacturers continue to lose money, cut their future manufacturing plans, and are emphasizing plug-in and regular hybrid vehicles instead. For some car manufacturers, hybrid models are vastly outselling their EVs.
The problem with all the EV hype is that the sales growth is falling below the expected trajectory. Moreover, growth has been supported by price cuts and margin contraction. Automakers are adjusting their output plans confirming the current market softness, a trend the industry sees continuing well into the future.
A recent survey conducted by AAA Northeast of their members in Rhode Island, Connecticut, Massachusetts, New York, and New Jersey showed more than half the respondents never plan to buy a BEV. Additionally, nearly half said they would not consider a plug-in hybrid.
Not surprisingly, an AAA official said the disinterest in EVs was fear of the unknown. Drivers fear being able to drive them, while also worried about charging them. Better education is supposed to be the solution. If that is true, why are gov'ts throwing even more money to lure buyers?
Jillian Young, director of public relations for AAA Northeast said, “What’s interesting is that this is an area of the country with an above-average market share of [EVs] and we’re still seeing this resistance.” Did she consider this is also a part of the country with a high percentage of virtue-signaling elites? Those were the early buyers of EVs, only to have seen their values fall like a rock during the last 18 months.
Meanwhile, a June Pew Research Center national survey that showed only three in ten Americans saying they would very or somewhat seriously consider purchasing an EV. That's down nine percentage points in the past year.
The Pew survey results provide interesting reading. The interest in EVs decreases as people age. The interest in EVs is highest in urban areas where people drive shorter distances so they do not suffer from “range anxiety” as much as suburban drivers, and certainly not as much as rural drivers.
Our Take: Brooks notes that 32% of EV owners are not interested in buying another one. Owners of hybrid vehicles seem to be almost evenly split between EV buyers and non-buyers. Owners of gas vehicles seem to be wedded to them. This, friends, is the elephant on the dealer lot that few want to acknowledge.
The sales curve for EVs is unsurprising. When flat screen TVs were first introduced the price was so high that they were only bought by people with a lot of money and a desire for the newest thing on the market. By the time that niche was saturated the manufacturers had been largely reimbursed for their R&D investment and they dropped the price enough to sell to the next niche. Eventually mass production and the introduction of cheaply made units made them as cheap as the Cathode Ray TVs they replaced. This is of course apples to oranges for 2 main reasons. Firstly; for TVs there were no special government subsidies or grants to help offset the R&D and production cost. Secondly; mass production of cheap EVs can never match the price of the cheapest ICE cars. If anything the consumer price or EVs may well increase as government subsidies decrease. There is nothing currently in development with the potential to lower the cost of EV batteries the way that new integrated circuit development constantly lowers the cost of TVs. Only legislation can force the switch to EVs, resulting in many people not owning cars. Even then many of us will keep our ICEs on the road as long as repair parts and fuel are available.