Driving growth during a period of uncertainty
The global automotive market is currently facing a period of change and uncertainty. This is due to the demise in sales of traditional diesel models, the growth in shared mobility and the concept of driverless vehicles.
One trend that is forecast to transform the market is the rise in popularity of electric vehicles (EVS). With the modern-day consumer becoming increasingly environmentally conscious, the demand for electric vehicles is rising — this can be seen from electric cars to electric rickshaws, e-buses to Formula E racing. Only this month, Uber’s CEO announced plans to diversify its services into electric bikes and scooters.
There are almost four million EVS currently on the road worldwide, a sharp increase from just 500,000 in 2014. In the UK market, sales of pure electric and hybrid vehicles are up 25% this year, with a new model registered every nine minutes. This upward trajectory is a result of a few key reasons. Firstly, the cost of EVS to the consumer has decreased due to a 79% drop in the price of lithium-ion batteries over the past seven years and the availability of government subsidies.
Additionally, there has been an increase in commitments from all leading car manufacturers to transform their current offerings to include a larger range of electric vehicles. EVS are entering the global mainstream market, but will a lack of progress in charg- ing infrastructure still present a barrier to growth?
For a long time, the main barrier to growth for EVS has been related to a lack of investment in the charging infrastructure rather than the development of vehicles, leading to the dubbed ‘range anxiety’ deterring mainstream sales. This has proved a major obstacle to mass adoption of electric vehicles, which are unable to travel the same distances as conventional vehicles using petrol or diesel.
Whilst improvements to charging stations have made it possible to charge a car to 80% in 10 to 15 minutes, the UK as a whole is falling short on target numbers.
However, could this be set to change?
The Government is planning to make it a requirement that all new homes built in the UK must have electric vehicle charging point infrastructure. Additionally, new street lighting columns in areas with on-street parking will also be fitted with EV charge points.
In June 2018, BP acquired the UK electric vehicle charging company, Chargemaster, which held the largest network of EV charging points in the UK, for £130m. The aim was to accelerate its plans to provide EV chargers at its forecourts, which is set to be in action within the next 12 months.
This highlights, not only that the future of the motor industry is electric, but also that the barriers to growth may not be as high as once expected.
Electric vehicles represent an emerging but fast-moving industry in Northern Ireland. There are currently 2,000 EVS on the road across Northern Ireland; however, the growth in recent years has been exponential. Notably, with 336 public charge points, Northern Ireland has higher than average charging availability in comparison to the rest of the UK. Can we stay ahead of the curve?
Electric vehicle sales have risen by 25% this year in the UK