Why electric is the future of automotive

The sound of mobility’s transformation is represented by the distant hum There are still challenges to electrification of the vehicle parc, but there are also opportunities worth fighting for. This is especially true in cities where safety, congestion and emissions are major concerns. As more people drive cars and travel more miles, the status quo will continue to cause mobility problems. In response, the mobility industry is unleashing a dazzling array of innovations designed for urban roads, such as mobility-as-a-service, advanced traffic management and parking systems, freight-sharing solutions, and new transportation concepts on two or three wheels.

Changes in regulation, consumer behavior and technology are key to the current opportunities to change fundamentally how we move.

Regulation. Incentives and regulations have been introduced by cities and governments to encourage sustainable mobility. Global regulators are setting stricter emissions targets. The European Union’s “Fit for 55”, which aims to align climate and energy, land use and transport policies, aimed at reducing net greenhouse gas emissions by at most 55% by 2030, was presented by the European Union. In addition, the Biden administration set a 50% electric vehicle (EV), target for 2030. EV subsidies are offered by most governments in addition to these mandates.

Cities are promoting alternative modes of mobility like cycling as a way to reduce congestion and private vehicle usage. Paris announced that it will spend more than $300 million on its bicycle network, and transform 50 kilometers of car lanes in the city into bicycle lanes. Many cities are also adopting access regulations for cars. Over 150 European cities have created access regulations to address pollution emergencies and low emissions.

Consumer behavior. As more people embrace alternative modes of mobility, consumer behavior and awareness are shifting. In-city trips using shared bikes and e-scooters in inner cities have increased 60 percent over the past year. The latest McKinsey survey indicates that average bicycle usage (shared and privately owned) could increase by more than 10% in the post-pandemic era (See also ” The future of micromobility: Ridership, revenue and vulnerability after a crisis July 2020). Consumers are also more open to sharing mobility options. Survey respondents in Germany indicated that more than 20% of them use ride-sharing services at least once a week. (See also ” Shared mobility: Where it stands and where it’s heading, August 2021).

Technology. Technology. Industry players are increasing the pace of automotive technology innovation by developing new concepts of electric and connected, autonomous, as well as shared mobility. Over the past decade, the industry has received more than $400 billion in investment. About $100 billion of this was attracted since 2020. This money is targeted at companies and start-ups that work on electrifying mobility and connecting vehicles. These technology innovations will reduce EV costs, making electric shared mobility a viable alternative to owning a vehicle. However, the best way to understand the quality of electric viacles is cartest for personal use. Any customer should realise the value of he is buying by test driving first and seeing how it feels.

While electrification will play a significant role in the evolution of the mobility sector, it presents huge opportunities for all segments of the vehicle market. However, the pace and extent to which this change takes place will vary. Launching new EVs on the market is a crucial first step to ensure widespread adoption of electric mobility. To make this transformation successful, the entire ecosystem of mobility must cooperate, including EV manufacturers and suppliers, financers, dealers and energy providers, as well as charging station operators.

Electric powertrains are the future of passenger car powertrains; this transformation is ongoing

In the second half 2020, passenger EV adoption reached its tipping point. EV sales and penetration accelerated in major market despite the economic crisis triggered by the COVID-19 pandemic. Europe was the leader in this development. EV adoption grew to 8 percent because of policy mandates like stricter OEM emissions targets and generous subsidies for consumers.

The discussion has centered around the 2021 end date for internal combustion engine vehicle (ICE) sales. The European Union and USA have set new targets for EV share. Many countries have also announced accelerated timelines to ban ICE sales in 2030 and 2035. Some OEMs have announced their intention to cease investing in new ICE models and platforms, while others have set a date for the end of ICE vehicle production. With more than 45 percent considering purchasing an electric vehicle, consumers have also moved to sustainable mobility.

The acceleration of electrification puts significant pressure on OEMs, supply chains and the wider EV ecosystem to achieve these targets. This is especially true when it comes to the installation of charging infrastructure.

The largest auto markets will be electric by 2035

Depending on where you live, regulatory pressures and consumer demand for EVs can vary widely. Europe is mainly a regulation-driven region with high subsidies. In China, however, the consumer pull towards EVs is strong despite lower incentives. EV sales in the United States have been slow due to limited regulatory pressure and consumer demand, but the trend towards change is expected under the new administration.

Globally, we anticipate EV (PHEV, BEV, and FCEV), to be adopted at 45 percent according to the current regulatory targets. Even this transformational EV growth outlook is not enough to reach net zero emissions. Globally, EVs will need to account for 75% of passenger car sales by 2030. This is significantly more than the current pace and course of the industry.

Europe, as a market driven by regulations and with high consumer demand trends, will electrify the fastest. It is also expected to continue its lead in EV market share. Several countries have announced that they will stop selling ICE by 2030. This is in addition to the target set by the European Commission, which calls for around 60 percent EVs to be sold by 2030. Seven OEM brands have pledged to sell 100 percent of EVs within the European Union by 2030. The most likely scenario is that consumer adoption will surpass regulatory targets, and Europe will have around 75 percent of the EV market by 2030. The European Union has set a zero emission target for new cars by 2035.

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