Roadblocks: what’s hindering an electric vehicle mass market?

​The Government plans to ban the sale of conventional diesel and petrol vehicles by 2040 in an effort to improve air quality. Aiming for a country of electric-only vehicles in just over two decades is ambitious, and there are several challenges that we’ll need to overcome. With the Government increasing the pressure and manufacturers showing a willingness to rise to the challenge, what does the road ahead currently look like?

Go to the profile of Ruth Andrew
Aug 17, 2017
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Accelerating into a new landscape

There’s no doubt that the attitude of car manufacturers and consumers has shifted in the last few years, and the pace of change has dramatically gathered speed, prompted largely by Government measures. Volvo has announced that from 2019, all of their new cars will be partially or completely battery-powered, and hundreds of thousands of people have pre-ordered the Model 3, Tesla’s first ‘mass-market’ car.

The automotive industry is clearly undergoing huge changes, and this could be the beginning of the end for the internal combustion engine (ICE). Volvo Chief Executive Håkan Samuelsson said that Volvo’s pledge to go electric marked the end of the solely combustion engine-powered car.

Globally, there are already 2 million electric vehicles (EVs) on the road, which represents a 1,500 per cent increase since 2005. But despite this leap, the number of EV sales still represents a very small share of total vehicle sales. In the UK, for example, electric vehicles count for just over one per cent of total sales. The industry still has a long way to go.

Speed bumps

There is a lot of good news in terms of electric vehicle development and uptake: the cost of battery packs has fallen significantly, vehicle manufacturers including Aston Martin, BMW and Mercedes-Benz have new electric models in the works, and Tesla has helped to make electric vehicles far more desirable.

But many of the challenges that have slowed progress so far still remain. There are three main barriers that need to be overcome if the Government is to successfully implement its ICE vehicle ban by 2040.

Expensive batteries mean expensive vehicles

Although battery costs have fallen by as much as 80 per cent since 2010, the packs can still cost around £12,000. This obviously pushes up the price of EVs and makes it very difficult to manufacture mass-market cars.

It will take subsidies and funding to bring the cost of EVs down, and experts predict that it could be a decade until prices equalise with conventional vehicles. Until we reach this tipping point, car manufacturers will be hampered by profitability and liquidity issues.

Cars that can’t go the distance

Governments and private sector companies around the world are investing heavily in battery research and development, racing to create batteries that have a longer range and can charge more rapidly.

But until improvements are made, the range of an electric car is poor compared to the distance an ICE vehicle can travel on a tank of fuel. Although a range of between 185 and 250 miles is often advertised, some EVs are only reliable for around 100 miles before needing a full recharge.

Lack of infrastructure

Even if we can overcome the problems of affordability and range, there are significant infrastructure issues that need to be addressed. There are already six EVs for every charging point in the UK, and that’s with our relatively small number of EVs.

A rapid charger at a motorway service station takes around 30 minutes to charge an EV, which means a long wait if there’s anyone ahead of you in the queue. And looking at the AA information on public charging points, it’s clear that they’re largely concentrated around urban areas. Erik Fairbairn, the CEO of POD Point, estimates that 45 million charging points will be needed if we have an all-electric market by 2040. Plus, for the environmental benefits of the EV regime to be realised, much of the power needs to come from renewable sources.

Driving change

If the UK is going to have an all-electric vehicle industry by 2040, and an industry that is profitable, there’s a lot that needs to change. Currently the cost, the lack of range and the limited infrastructure is thwarting progress. Not forgetting, of course, the safety and environmental concerns around electrification, and the fact that EV manufacturers are largely dependent on China for lithium supplies.

We’ve passed a point of no return, however, in the journey away from ICE-powered vehicles and towards EVs, and there are plenty of reasons to be positive. Manufacturers are making wholehearted commitments to EVs, pushed by governments that remain committed to CO2 emission reductions. The road ahead may be long, but the destination is within reach.

Go to the profile of Ruth Andrew

Ruth Andrew

principal associate, Mills & Reeve

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