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Hope Persists for EV Growth Despite Obstacles

City with EV cars   ©Jae Young Ju
©Jae Young Ju

The push by governments and the automotive industry to promote electric vehicles (EVs) as a replacement for diesel- and gasoline-powered vehicles is rapidly gaining traction. It is a move of historic proportions, as it will effectively end the internal combustion engine’s (ICE’s) 100-year hegemony that helped kick-start the age of the private vehicle in the 20th century.

According to a recent Bloomberg New Energy Finance (BNEF) estimate, twenty-six million plug-in vehicles will be on the road globally by the end of this year, out of a total automotive market of around ninety-two million units. Almost one million EVs a month are being added to the global fleet. That compares with a total global EV fleet of just one million in 2016.

The BNEF estimate shows the world EV market is currently dominated by China with 46% of total sales. Europe with 34% of total EV sales is second, followed by the US with 15%. Total EV sales are forecast to reach 31.1 million by 2030. This is out of a forecast total automotive market size of 122.83 million units, according to AutoTechNews. According to a Deloitte report, in 2030, China, Europe, and the US will continue to account for the broadly similar EV market share that they do today, achieving 49%, 27%, and 14%, respectively.

Electric generic car technical cutaway with all main details of the EV system.   ©leonello
Electric generic car technical cutaway with all main details of the EV system. ©leonello

Policy Support Supports EV Market

Fresh policy support should get the US EV market moving. By 2030, analysts predict the US auto market will have fully recovered from the effects of the recent COVID-19 lockdown slump and returned to its pre-2020 highs of eighteen million units—with 45% of all cars to be EVs. All the major car manufacturers in the US have either developed EV models or are in the process of doing so. Tesla leads the way with a reported 69.95% of the US market share. Nissan is in second place with 8.51%. Other US manufacturers are expanding their products, including Ford and Volkswagen this year.

Japan is the second largest auto market in Asia, after China. However, EV adoption has been slow. There are hopes though that this could soon change. BNEF reports that car giants Nissan and Mitsubishi have plans to bring new EV models to market before the end of this year. These will be closely followed by Honda in 2024 and Daihatsu the following year. Meanwhile, in South Korea, EV take-up is strong, on the back of offerings from domestic car makers Hyundai and Kia, with end-2021 EV sales nearing 15%.


The disadvantages that have hampered the growth of EVs over the years are well understood. They include poor performance, compared with ICE vehicles, and a lack of range, compounded by the low availability of charge points; the multiplicity of payment options; and incompatible charging technologies. There is also the problem of slow charge times. These can often be measured in hours, rather than the minutes typical for ICE vehicles at fuel stations. Mercedes-Benz CEO Ola Källenius told the Stuttgarter Zeitung, “As long as the charging structure and the markets have not yet reached the point of switching completely to electric cars, there will continue to be cars with combustion engines.”

The acceptance of EVs is hampered by the low availability of charge points, the multiplicity of payment options, and incompatible charging technologies.   ©ViktorCap
The acceptance of EVs is hampered by the low availability of charge points, the multiplicity of payment options, and incompatible charging technologies. ©ViktorCap

In recent years though, automotive companies have markedly improved EV performances. More charge points are being installed, and efforts are being made to homogenize their technologies. The “holy grail” of higher EV recharge speed that can compete with the ICE’s fuel pump speed is now close at hand. The fastest EV charge points now promise a vehicle battery recharge of around five minutes for 100 miles of charge.

In recent years, automotive companies have markedly improved EV performances.

An Israeli EV battery company, StoreDot, is developing Extreme Fast Charging (XFC) technology based on silicon-dominant lithium-ion chemistry, that promises to whittle this time down to as low as “two to three minutes” by 2030. Meanwhile, the China-based Contemporary Amperex Technology Co., Ltd. (CATL), one of the world’s leading makers of EV batteries, has announced that its next-generation battery has a range of 621 miles and will debut early next year. This range compares favorably with the Lucid Air battery, which has a range of 520 miles, and the Tesla Model S, with 405 miles.

Electricity Price Rise

But even as EVs look to making their long-awaited market breakthrough, two issues threaten to derail their progress. The first is the unforeseen rise in electricity prices this year caused in part by the ongoing war in Ukraine. EV market growth relies on an increase in the availability of ever more powerful batteries. This in turn requires rising electricity production and consumption.

The unforeseen rise in electricity prices this year threatens to derail EVs progress.

Last September, Tesla announced that it was increasing its Supercharger prices “significantly” across Europe. It blamed the skyrocketing costs of both gas and electricity that have risen over the last year. It used to cost between $5 and $10 for a full charge at a Tesla Supercharger. However, many Supercharger stations are now charging $0.50 per kWh. This is equivalent to a cost of $30 to charge 60 kWh. A Tesla email to owners in Europe warned of yet more price increases on the Supercharger network. In the UK, EV customers face higher energy costs following the UK’s planned October electricity price rise.

The Problem of Lithium Supply

The second issue has to do with the availability of lithium, a key component for EV batteries. According to McKinsey & Co., 98% of all global lithium is produced in China, Latin America, and Australia. Although some private firms in the US are keen to enter the lithium mining sector, they have faced fierce domestic opposition. The same story has unfolded in Serbia and Portugal, which has left the supply chain vulnerable to disruption.

EV minerals   ©Dimitrios Karamitros
©Dimitrios Karamitros

compound the supply problem, by 2030 lithium supply is forecast to fall short of demand by 4% for the first time, according to the Boston Consulting Group (BCG). By 2035, the gap is set to expand to 24%. UK’s Advanced Propulsion Centre (APC) warns that the likely shortages of lithium for electric battery production in the UK could endanger the move towards EVs and instead facilitate a transition to alternative hydrogen fuel cell vehicles. The APC claims that as many as 75% of the largest and luxury cars, including vehicles such as the BMW 7 series, the Mercedes S class, and typical Rolls-Royce and Bentley cars, could be forced to switch away from electric power supply. The sports utility vehicle (SUV)/four-wheel drive markets might face the same problem, all of which will have a major impact on EV demand.

Shortages of lithium for electric battery production could endanger the move towards EVs.

An additional factor is the upfront purchase or financing cost of an EV continues to remain stubbornly high compared to ICE vehicles. The cost of financing a Tesla Model 3 in 2022 is around $52,875 against that of a BMW 3 Series gasoline engine model, which costs from $39,986 to $41,676.

But while EV proponents admit that the purchase and financing costs of an EV are higher than for an ICE vehicle, they point out that the running cost of an EV over an average lifespan is much lower than for its conventional ICE-powered counterpart. So over ten years an EV vehicle could, in fact, prove to be the cheaper option. Plus, EV battery recharge costs are comparatively low at around 80% cheaper than the refuel cost of an ICE vehicle. “The typical family-sized EV now costs £28.51 [$31.09] using a rapid charger—£64.25 [$70.06] cheaper than filling the same size car with fuel,” Tom Rowlands, managing director, Global EV Solutions at Fleetcor, wrote in Automotive World in September.

Maintenance costs for an EV that typically only has around twenty moving parts are also lower compared with an ICE vehicle, which typically has more than 2,000 moving parts. So, in conclusion, while the current cost of purchasing an EV is high, it is now falling. Thereafter, cheaper running costs at least provide opportunities for savings.


*Nnamdi Anyadike is an industry journalist specializing in metals, oil, gas, and renewable energy for over thirty-five years.


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