Electric Cars' Unsold Inventory Signals Auto Industry Decline

author: FutureCar Staff    

As the auto industry sees an increase in EV inventories on dealer lots, they are faced with numerous challenges. These challenges include addressing concerns about driving range, vehicle reliability, price, charging infrastructure availability, charging time, battery cost and lifespan, environmental impact, carbon emissions reduction, lithium battery fires, battery recycling, end-of-life management, the potential end of EV owners' free ride on highways without paying fuel taxes, and the possibility of higher rates for home chargers to stabilize the electrical grid.

One major problem for the automobile industry is convincing buyers that it is ethical, moral, and socially responsible to purchase an EV. This is especially difficult since many of the minerals and metals required for battery production are mined in developing countries with limited environmental and labor regulations. The lack of transparency in the green movement's impact on these countries is discussed in the Pulitzer Prize-nominated book "Clean Energy Exploitations" and the documentary film "Planet of the Humans."

With government mandates pushing automobile manufacturers to reduce emissions, they are increasingly focusing on manufacturing EVs. However, while manufacturers are stocking up on EVs, the demand from the public is not yet matching the supply. The current profile of EV owners consists of highly educated, highly compensated individuals from multi-car families with low mileage requirements for their second car. This profile is not representative of most potential car buyers who are not as highly educated or compensated. Mandating a switch to EVs and imposing austerity measures may face resistance from those who rely on affordable transportation.

In the United States, the majority of car sales are used combustion engine cars, with the EV industry having virtually no used car market. This lack of a resale market, combined with the potential need for expensive battery replacements, poses a major problem for the auto industry. Additionally, the distribution of EV ownership throughout the country is a concern, with California accounting for 40% of EVs in the US. The other 49 states have limited EV charging infrastructure and may even be exporting electricity to California.

The UK is ahead of most countries in protecting its grid with Smart Chargers and separate meters for EV charging users. New regulations require smart chargers to have preset limitations on their functioning hours and allow authorities to impose randomized delays to prevent grid spikes. All home-installed electric vehicle chargers in the UK are required to be separately metered and send information to the Smart meter data communications network. This legislation allows for the potential charging and taxing of EV electricity at a higher rate and enables the rationing of electricity for EV charging if necessary.

With the rise in EV inventories on dealer lots, the road to widespread EV adoption may be challenging for the auto industry.

Ronald Stein, an engineer and senior policy advisor on energy literacy for CFACT, highlights these issues and is a co-author of the book "Clean Energy Exploitations."

FutureCar Staff