Electric Vehicles - Is the Tipping Point Near?
Updated: Jun 14, 2021
When Elon Musk first came on the scene in 2003, it didn’t take long for him and his company to become well recognized brands. Shortly after Tesla’s debut, electric vehicles (EVs) became the topic of conversations at water coolers across corporate America. Tesla’s charismatic (and egocentric) leader seemed confident that mass produced EV’s would one day rule the automotive industry.
Not everyone agreed, and not everyone still agrees. Was Tesla the future or a fad? I remember discussing battery electric vehicles (EVs) with a co-worker in 2003-2004. He saw EV’s in the same light as flying cars; it’s more fantasy than reality. “Without government subsidies they’ll be out of business in a year,” he told me. He’s not wrong about Tesla receiving public funding, but Tesla’s public-private relationships are a topic for another day. Fifteen years have passed since then and Elon and company haven't gone out of business. Tesla is worth an estimated $450 billion (USD) - double that of their next closest competitor, Toyota.
Although EVs currently make up a small percentage of overall automotive sales, their year-on-year growth (around 40%) points toward a market that is trending up rapidly. It doesn’t take statistics to understand that Tesla has disrupted the automotive industry. Just five years ago, spotting a Tesla on the streets was about as rare as seeing a Ferrari. These days Tesla’s are about as common as Honda Civics.
Tesla is still in charge of the EV market but they are not alone. At some point in the mid-2000s the big automotive companies concluded that electric vehicles were not a trend that would soon pass. It’s not a matter of if, but when, the tipping point from gas to electric vehicles will occur. Those who are not prepared will go the way of Studebaker and Chrysler.
Ford, GM, Nissan, BMW, Toyota, Honda and the other major automotive corporations quickly joined the EV pursuit. R&D resources have shifted heavily toward electric technologies, and the EV race is on.
Last month GMC announced its newest Hummer scheduled for release in the fall 2021. Not the gas-guzzling, 10 miles per gallon, off-road monstrosity that many associate with the Hummer brand. GMC describes the latest model as an all-electric “zero emissions supertruck” featuring 1,000 hp, 11,500 lb/ft torque, and a range of 350 miles. To me, the Hummer brand is the exact opposite of the demographic I associate with EVs. Remember the early EV adopters ? The ones behind the wheel of the 1999 Honda Insight (pictured below)? Times have changed.
Other automotive OEMs are releasing BEVs as well. Luxury automotive brands including Porsche and Maserati have developed electric supercars capable of accelerating to 60mph in less than 3 seconds.
In addition to the automotive establishment, a number of innovative entrepreneurs have built startups that are pushing the boundaries of electric technologies. Lesser known companies including Bollinger, Lordstown, Rivian, Lucid, Byton, Fisker, Lightning and Nicola have developed (or are developing) electric transportation that fill a variety of needs. Will these newcomers challenge the automotive superpowers or become the next generation of automotive royalty? No one knows, but it’s clear we have entered into a new era of personal transportation.
In addition to increased EV competition, automotive manufacturers are competing to recruit the best and brightest engineers, scientists, and other workforce talent. Fortunately for them, a career in the EV industry isn’t a hard sell. Renewable energy has tremendous economic upside and the added intrinsic benefit of reducing pollution caused by fossil fuels.
Advancements in manufacturing, supply chains, charging infrastructure, battery chemistry, and other technologies are steadily dropping EV prices. It’s probable that EVs will soon rival (or beat) their gas engine counterparts in price point and cost to maintain, not to mention fuel cost savings. As EVs become more attainable from a financial perspective demand will continue to grow.
Only time will tell how fast the EV market will continue to advance, but it’s safe to say it’s no longer a futuristic concept. EVs have arrived. The only question is what will this industry look like a decade from now? Or for that matter, a month from now?
Jon Mullett is a freelance marketing contractor located in Fort Collins Colorado. www.mullettmarketing.com