Sales of battery electric vehicles (BEVs) began increasing during COVID-19, supported by some major policy announcements from governments. This wave of policy and legislative moves has profound implications for BEVs. For example, in the European Union, the ‘Fit for 55’ package of proposals to help meet the target of reducing net greenhouse gas emissions by at least 55% by 2030 may start to come into effect this year.
And in the US, President Biden is attempting to push his huge Build Back Better programme through Congress. That contains $320 billion in clean energy funding, including EV tax credits and funding for charging stations.
I'm interested to see whether consumers get excited by the new products from EV-only start-ups, such as Lucid, or whether they favour the ‘traditional’ OEMs, such as VW and General Motors, as they bring out mass-production cars with a battery.
Tesla, meanwhile, is likely to continue to perform well with consumers as they expand their production capacity this year.
And, despite uncertainty over battery costs due to rising component prices (see below), progress is still expected towards price parity as automakers scale EV production and unlock further cost savings.
An increasing number of customers are looking to drive vehicles with smart connectivity features. These features allow drivers – who are used to the experience of a handheld device – to interact with the car. And innovative car manufacturers are responding with technology that entices new EV drivers.
Three years ago, connectivity was one of four hot pillars of future mobility, along with autonomy, electrification and sharing. But post-pandemic, the emphasis will be on the importance of electrification and connectivity.
Ambitions of full autonomy have somewhat subsided for passenger cars because the technology is proving a lot harder than originally thought. But some of the technology that was accelerated in the initial chase ater autonomy is still being deployed, which is why we're seeing new ‘smart’ driving features, such as advanced driver-assistance systems (ADAS), entering the market and the increasing use of LiDAR (light detection and ranging).
Car sharing, meanwhile, has been an inevitable casualty of the pandemic and its restrictions on communal activities.
With their combination of utility and luxury, reliability and affordability, pick-up trucks and SUVs are the biggest market segment in the US. So it’s no surprise that car manufacturers are tapping into that market too, with new electric pick-up models expected this year.
Tesla is building the Cybertruck, while Ford is launching the all-electric F-150 Lightning pick-up truck, which has a 300-mile (480-kilometre) range. This release has proved so popular that Ford was forced to close pre-reservation after orders hit 200,000.
With EVs containing so many semiconductors, the mismatch between demand and supply could be a problem this year. Linked to this is the ‘chicken and egg’ problem, pitching charging infrastructure against vehicles on the road. Infrastructure can’t be rolled out without semiconductors, because the charging points have them too.
In markets such as China, India and Vietnam, electric two-wheelers (E2Ws) are making serious headway, with total cost of ownership shifting towards favourability in these markets. The E2W market has mainly been fuelled by start-ups, but global players like Honda are adapting their strategies to capture the incoming market demand.
E2Ws are also at the forefront of adopting battery swapping, which is expected to accelerate the adoption via increased ‘charging’ speed and a more convenient customer experience. Battery swapping is also popular for EVs in key markets such as China. A few start-ups are experimenting in this area, including Gogoro and Aulton.