According to surveys, 20% of American drivers and 40% of European drivers expect their next car to be electric. (Business Green reports that all that may be about to change, with a new Ipsos Mori poll suggesting that a whopping 40% of drivers expect their next car to be electric. Norway has already exceeded that threshold and seen oil demand drop as a result.) Yet legacy automakers are continuing to drag their feet, pushing out some reasonably impressive models but at nowhere near the volume needed to meet such demand—should these expectations turn out to be true.
Meanwhile Tesla—which has no sunk costs in legacy auto technology or dealerships or manufacturing facilities to maintain—appears to have turned a corner and is now churning out long-range, reasonably affordable electric cars at a rather astounding rate.
At some point, automakers are going to have to decide if they are going to go all-in for electric cars, or whether they are going to hope like hell that electrification is a flash in the pan and/or a long-term transition that they have time to adapt to. The rate at which fossil fuel car bans and electric commercial fleet commitments are spreading would suggest the latter strategy is a losing one.
Kyle Stock over at Bloomberg (found via Cleantechnica) is predicting that a fair few legacy automakers won’t be able to survive the transition—largely because their lukewarm adoption of electric vehicles is resulting in relatively poor sales for the new product, and a long tail of fossil fuel vehicles, sales of which they are using to fund the transition.
At some point when the paradigm flips, says Stock, many of these old school car makers will simply end up too far behind to catch up to what is coming:
They are essentially using an old technology to fund the transition to the next, and the timing is fraught. Jump to the electric drive train too soon and the whole works will grind to a halt; jump too late and lose the EV race. Startups such as Tesla, critically, don’t have to make this awkward jump. They are tiny and inexperienced, but they don’t have to worry about feeding a legacy business as it slowly winds down.
Meanwhile Dan Neil over at the Wall Street Journal (also found via Cleantechnica) is predicting a huge leap in the quality and diversity of electric and plug-in hybrid cars, so much so that his next car will likely be electric and gas cars will essentially end up like the flip phone.
It will be interesting to see how all this shakes out, but it’s increasingly clear that gas cars’ days are numbered. And manufacturers of those cars are going to have to be extremely canny in how they manage the transition to the new normal.