Electric Cars Becoming Mainstream


<April 16, 2016>

When Tesla’s Elon Musk took to the stage to reveal the Model 3 on March 31, 2016 he already had 115,000 reservations with a $1,000 deposit just to get in line for a car that might not ship in considerable volume until 2019.

In just the first two days the number of deposits for the Model 3 pre-orders stood at 276,000.

Today that total is over 400,000 cars. That’s Deposits totaling over $350,000,000 – for a car that might not ship in considerable volume until 2019.

With so many Model 3 reservations supposedly taken in just a few days, the number could easily double within a few months. Musk expects that to happen. Two days ago, he tweeted that 500,000 pre-orders are possible “if the trend continues,”

When Tesla’s have been available to American consumers for the better part of two decades. The first EVs looked like science projects only a Sierra Club member could love, while today an all-electric luxury sedan, the Tesla Model S is routinely described as the coolest car on the planet. Early electric cars had a maximum range of 50 miles; today’s highest-rated EV, the Tesla Model S, can go as many as 300 miles before it needs to plug in. And yet, for all that progress, fully electric vehicles still make up less than 1 percent of US auto sales.

What just happen is monumental. With the average price tag at $42,000 this would equate to $11.6bn in sales, in the first two days, that’s 7.6% of GM’s annual sales.

What are the current EV sales in the US?

  • There are currently 25 different models sold in the US. Fewer than 10,000 cars per month, or 120,000 per year are being sold.
  • February 2016 sales increase more than 25% over January 2016 sales.
  • What are future projections for EV technology in the auto industry?

    • A new study by Bloomberg New Energy Finance (BNEF) forecasts that sales of electric vehicles will hit 41 million by 2040, representing 35% of new light duty vehicle sales worldwide. This would be almost 90 times the equivalent figure for 2015, 60% up on 2014.

    Driving the sales increase is a forecast significant reduction in battery prices—the result being that during the 2020s EVs will become a more economic option than gasoline or diesel cars in most countries.

    A new study from Juniper Research forecasts that nearly 17 million hybrid and electric vehicles will be on the road by 2020, up from an estimated 12 million last year.

  • How is technology changing the automotive industry?

    • The pace of vehicle technology change is accelerating. Vehicles are changing in response to consumer taste and expectations,
    • Higher safety standards
    • The drive toward a low-carbon future.
    • When considering changes in automotive technologies that support the “greening” of automotive transportation, most people think first about advanced powertrains, materials and electronics. These three technology sectors play a significant role in the transformation of the new auto industry:
      • Powertrain: The most noteworthy change is the re-emergence of the electric vehicle. The development of alternative forms of energy storage (primarily batteries) is rapidly progressing.
      • Materials: The need to make vehicles lighter for improved fuel economy is a major driver in the development of automotive materials and forming. The U.S. workforce’s strength is in steel, but less so in alternative materials. While there are only a few domestic metallurgy programs focused on lightweight materials, Europe and Asia have much more experience in this field.
      • Electronics, software and controls: Technology in vehicles will continue to increase at a rapid rate. Today, electronics accounts for 25 percent of a vehicle’s value—tomorrow, 40 percent.
    • What are some of the other advancements that may be coming in the near future?

      ABI Research has defined six transformative paradigms for the automotive industry over the next 25 years: the software-defined car;

      • Sensors and big data;
      • The connected car;
      • Cooperative mobility and the IoT (Internet of Things);
        • Fast Food ordering, navigation.
      • Electrification; and
      • Car sharing/driverless cars.
      • While the first three phases are already underway, the latter three will start to drive the market forward within the next 10 years, according to the market research firm.

      Car manufacturers are currently revamping vehicles’ electronics and networking architecture to ensure every sub-system is connected and software-defined. Moving toward the next decade, the automotive industry will achieve cooperative mobility. Cars will communicate with not only each other but also infrastructures and environments. Electrification will then change the way consumers power their vehicles. And, lastly, car sharing and driverless cars will likely lead to market consolidation.

    • Links

    • http://insideevs.com/february-2016-plug-electric-vehicle-sales-report-card/
    • http://www.greencarcongress.com/forecasts/
    • http://www.wired.com/2016/01/gm-electric-car-chevy-bolt-mary-barra/
    • http://evobsession.com/electric-cars-2014-list/
    • http://money.cnn.com/2016/04/06/autos/tesla-model-3-tax-credit/http://www.bbc.com/news/technology-35940302
    • http://www.drivingworkforcechange.org/autoindustry.asp