BACK TO FUTURE! COVID-19 ACCELERATES ELECTRIC CARS

Only four more years for new internal combustion cars?

Ordering a new Petrol or Diesel/Internal Combustion Engine (ICE) car in 2025 will be like ordering your new Blackberry phone in 2010! They will soon be obsolete. By 2030, ICE residual values will have totally crashed. The iPhone won, the BlackBerry is all but dead and the electric car will win also. And soon.

The resale values of electric cars and the total cost-of-life ownership are now already better than internal combustion vehicles in many countries.

The shift to electric cars is about to go exponential…

Why? Regulation, Manufacturers, Consumers and now… COVID-19!

Regulation

Many cities and governments will be well advanced on their internal combustion bans by 2030. Significant numbers of cities have already approved and will have introduced Diesel bans by 2025. By 2030, most cities, in Europe at least, will have banned or heavily penalised city driving of internal combustion cars. Indeed, countries like Norway, will have outright bans on new internal combustion cars by 2025, the UK by 2035 for example.

OEM’s Shift

Every manufacturer is now working on massive development programmes to shift to electric. Volkswagen for example, one of the dominant European brands, is going electric.  Even the iconic Ford Mustang is now electric. With a deluge of new electric models coming to market in the next few years, the opportunity for all to experience electric, at every budget level, is coming this year. R&D on ICE cars has stopped. Attention is now fully focused on electric. 

The Consumer

Trends and fashion tastes change. What was acceptable 10 years ago may be frowned upon today. Like smoking in public bars and restaurants was once commonplace, this would never be tolerated today. 

In the near future, driving a polluting, noisy car will be seen as anti-social. After all, why should we breathe polluted air due to someone else’s choice of car? The benefits of clean air and quieter streets will quickly displace the unquestioning acceptance of polluting ICE dependent mobility that dominates our cities today. Like smoking, a paradigm shift in driving is underway that will totally transform what is considered normal and even desirable today. 

The clear skies and fresher air during the lockdowns have shown us what’s possible. Now that we have had a taste of clean air these past months – wouldn’t it be nice to keep it that way?

The Virus Factor

Throughout human history, major tumultuous events have reshaped our perceptions, changed norms and influenced our habits. Major events like war, economic collapses, plagues, and political revolutions frequently resulted in unintended positive and negative consequences.  The cold war spurred on the space race and ultimately led to men on the moon. The internet created global communities and made the world a smaller place and changed the way we work, shop, and communicate. 

Even though we knew something like this could challenge us, when the virus became a pandemic, we were ill-prepared, and it has shaken our ‘systems’ to the core. It’s the same with climate change, we think we know what will happen and can be ready, but we are not. Like the virus we are totally ill-prepared for the consequences. 

In just a few short months, our collective consciousness about our climate and the quality of our air has greatly increased. The skies cleared with the lockdowns. Particulate matter, airborne pollutants, and smog decreased dramatically across the planet and the world has taken note.

Governments are planning to use the opportunity of this crisis to galvanize nations to focus the economic restart and recovery efforts on a green economy. All across the world, economic stimulus packages will re-establish economies with an emphasis on green tech and clean industries. Cleaner air and a greener future will be brought forward…and so will electric cars! 

The EU has today (27th May 2020) announced a €750 billion economic recovery package with an emphasis around the European Green deal – this includes investment for one million new charging points across the continent.

These efforts will accelerate electric car adoption. Current predictions of 40% - 50% of the global fleet being comprised of electric cars by 2040 are now out the window! This is going to happen much sooner and quicker than most of us think. The technology exists, it’s proven, it works and is far better in every way than internal combustion mobility. 

So, between regulation, customer demand and the OEMs shift – an earlier than expected electric future awaits. It’s an inevitability.

Can we suddenly just go electric now?

90% of drivers drive less than 100km per day! There is a proliferation of new fast-charging networks across the world. The range of electric cars is increasing, even at the lower budget models where ranges of 350km+ are becoming standard.

Longer range combined with accessible, easy-to-use charging networks make long distance electric travel (even for those 10% of journeys >100km!) workable. There is no longer an excuse not to drive electric today…and the overall experience is getting better all the time. 

Everything will change from petrol stations, to manufacturer supply chains, big oil, insurance and even how you drive! Many businesses will thrive, but lots won’t. Those that can quickly adapt to the electric revolution will prosper. 

The recent bankruptcy announcement by Hertz, one of the oldest and best-known rental companies, is not only due to the virus induced demand crash but also because of a decade’s old reliance on used ICE car sales. 

Hertz now sits on hundreds of thousands of cars with gradually dating technology and dropping residual values. Cars like these will be unsellable in 2025. This shock to some business models will be fatal. Those that awaken to the inevitability of electric mobility soonest will be more likely to survive and thrive. 

Corporate, Private, and Government fleets, transport and logistics companies will not be buying internal combustion in 2025. Their financiers would never approve that credit line for a soon-to-be obsolete asset. Resale values within 3-5 years of then (2028-2030) will be decimated as a flood of unwanted secondhand ICE cars glut the market. This, combined with the release of ever more desirable electric models and increased customer demand will kill off ICE sales forever.

Many of the misconceptions and myths around electric cars today are just that. You can’t drive long distance, there is nowhere to charge, the battery will die after a few years. Exaggerated scaremongering by those prolonging a reliance on outdated technology. Electric travel works, it’s better, it’s now proven and improving daily.

The Covid crisis has turned many predictions and models upside-down. Regulation, economic recovery stimulus plans, a growing awareness and concern about our air quality will accelerate the shift to electric…only about 1,500 days to go for the end of the internal combustion sales era!