Automakers continued to slip away from electric vehicle (EV) targets last year as weak consumer demand stifled growth, despite the Biden-Harris administration pumping billions of yen into the electric vehicle industry through subsidies.
Since February, many automakers have abandoned their primary EV goals, with Volvo, Ford and Mercedes-Benz all reducing EV allocations or dropping previously planned product lines, a shift in corporate strategy signaling a shift toward EVs. Advertised by auto industry executives such as Ford CEO Jim Farley Experts told the Daily Caller News Foundation that electric vehicles may not be as viable as the future of the auto industry once thought, due to consumer distaste for low driving range, a lack of charging infrastructure and rising prices. (Related article: Biden-Harris Administration's multi-billion dollar electric school bus plan is a giant gift to China, House report says)
The auto industry is turning around despite billions of dollars of investment. Subsidies Allocated to the industry through the Bipartisan Infrastructure Bill of 2021 and the Inflation Reduction Act of 2022, the White House is providing a $7,500 federal tax credit for certain EVs to help mitigate costs for buyers and has allocated $12 billion for automakers to retool factories to produce EVs. The administration has also introduced stringent regulations designed to phase out internal combustion engine vehicles, including emissions standards that effectively mandate that approximately 67% of all light vehicles sold after the 2032 model year be electric vehicles or hybrids.
“We're stuck in a terrible cycle of pouring money into EVs — and therefore taxing people — to get them off the shelves, yet (1) there's not enough demand to support the volume of EVs produced, and (2) the people who paid for them now want to go back to their old cars,” O.H. Skinner, executive director of Consumers Union and former Arizona Attorney General, told DCNF.
Cars from the last 5 years:
Automotive CEO: “I will go electric by 2030. If I do that, I'll be the hottest guy in town and glossy magazines will write about how forward-thinking and environmentally friendly I am.”
Engineer: That's not possible…
Accountant: That's not possible…
Customer: “We…” https://t.co/ldca2L0n4G
— Consumers Union (@for_consumers) September 4, 2024
Despite generous tax credits, consumers have been less willing to adopt EVs than the Biden-Harris administration and automakers had hoped, with EV sales declining. Growing That figure is expected to rise to 50% in the first half of 2023 and 31% in the first half of 2024, less than the 71% increase in the first half of 2022. Moreover, a June poll by The Associated Press-NORC Center for Public Policy Research and the University of Chicago Energy Policy Institute found that 46% of respondents said they were unlikely or very unlikely to buy an EV, and just 21% said they were “very” or “extremely likely” to change.
Consumer sentiment toward EVs is lackluster, even among people who have already bought one, and a June survey by consulting firm McKinsey & Company found that nearly half of Americans who own an EV want to go back to a standard car.
” [EV market] “The headwinds come from physical realities that turn into economic and practical realities,” Mark Mills, distinguished senior fellow at the Texas Public Policy Foundation and an expert on auto markets, told DCNF. “EVs are inherently expensive, and most consumers are very price sensitive. Refueling an EV is much less convenient for most people… [and] EV fueling infrastructure is very expensive and takes a long time to build.”
The average cost of a new EV is 10% Higher Electric cars in 2024 will cost more than standard cars in January Version Base Ford F-150 Cost Calculation Approximately $20,000 moreFord F-Series bestseller Vehicles to be sold in the U.S. in 2023.
Ford cancel The company plans to produce a three-row electric SUV in August. Decreased Ford halted production of its F-150 Lightning pickup truck in January. The reversal of plans comes after the company projected a $4.7 billion loss on EVs in 2023, amounting to a loss of nearly $65,000 per EV. In response to questions, a Ford spokesperson cited previous comments to DCNF, saying, “We do not intend to launch a vehicle unless it is profitable within 12 months of launch.”
“This is a tremendous cost to impose on American families,” Diana Furchtgott Roth, director of the Heritage Foundation's Center for Energy, Climate and Environment, told DCNF.
Electric car makers Tesla and Lucid also struggled last year and announced plans to lay off about 10% and 6% of their workforces, respectively.
In addition to high costs, expanding charging infrastructure has also been a challenge for manufacturers. Despite $7.5 billion allocated in a bipartisan infrastructure bill to build a nationwide EV charger network, the Biden-Harris Administration has built just seven EV charging stations in four states as of April 2024. Lack of demand, labor union requirements, diversity, equity, and inclusion efforts, and the Department of Transportation's requirement that applicants promise to host “neighborhood block parties” and engage in “intentional outreach to underserved communities” in order to qualify for funding have significantly delayed the rollout of projects.
In addition to a lack of infrastructure, charging is simply inconvenient for consumers, with charging times ranging from 20 minutes to over 50 hours depending on the charger voltage and battery size. According to According to American automotive resource Edmunds, even “fast charging” in downtown Washington DC can take around 35 minutes.
Faced with these obstacles, Volvo Cars Abandoned The company plans to have all its models electric by the end of the decade, at which point it aims for 90% to 100% of the cars it sells to be fully electric or plug-in hybrids.Mercedes-Benz made a similar announcement in February, lowering its goal of selling 100% electric vehicles by 2030 to 50% after its fourth-quarter 2023 net profit fell 21.5% year-on-year.
“The Biden-Harris Administration is spending billions of dollars on tax incentives to auto companies to pay for EV production, and billions on tax credits to households to buy cars,” Furchtgott-Roth told DCNF. “Yet Americans aren't smart enough to be duped by a product that doesn't suit them.”
The White House, Volvo and Mercedes-Benz did not respond to requests for comment from the DCNF.
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