Please wait while the search results are loading...

Electric Cars and Plug-in Hybrids (PHEVs) Enter the Market in Low Numbers, Business and Industry Trends Analysis

Automotive manufacturers in the U.S. and around the world are investing very heavily in research, design and factory capacity for new electric vehicles (EVs) of all types.  This includes fully electric cars and trucks as well as hybrids.  Plug-in hybrids (PHEVs) are similar to standard hybrids (in that they can run on their gasoline-powered engines or battery power), but they enable the owner the option of plugging-in at home overnight to recharge the battery.  This will eliminate the need to run the car’s gasoline engine, using only battery power as long as the relatively short range isn’t exceeded.  (Standard hybrids recharge only by running the gasoline-powered side of the car, and by drawing on the drag produced by using the brakes.)
According to Motor Intelligence, sales within America of all-electric vehicles rose from 490,456 in 2021 to 807,180 in 2022.  EVs accounted for 5.8% of U.S. auto sales in 2022, compared to 3.2% in 2021.  Worldwide, there were about 10 million electric and plug-in hybrid cars sold in 2022, according to the International Energy Agency (IEA).  This growth, plus government mandates and incentives, is spurring global car manufacturers to invest more than half a trillion dollars in electric vehicle and battery development through 2026, according to AlixPartners. 
In the U.S., the Schumer-Manchin tax bill includes EV subsidies in which certain purchasers qualify for a $7,500 tax credit.  The bill eases a previously established cap of 200,000 total all-time EVs sold per manufacturer that could qualify for credits, and establishes an income limit of $150,000 per year for an individual, $225,000 for a head of household, or $300,000 for married couples who purchase the cars and want the tax credit.  It also sets qualifying price limits of $80,000 for pickups, SUVs and vans and $55,000 for sedans.  In addition, credits are being adjusted so that EV batteries must be made of materials mined or processed in the U.S. or in countries with which the U.S. has free trade agreements.
EV sales are rising because of lower prices.  Competition is driving price drops to some extent, as Tesla now has lots of competitors in EVSs, ranging from well established companies like Ford and Volvo to startups like Rivian.  Also, new, cheaper battery technology is being developed to make this possible.  In 2023, Tesla dropped prices by $5,000 each for two of its popular base models, and also reduced prices for its Model 3 sedan and some Model Y crossovers.

Challenges For EV Makers’ Lofty Production Goals
The EV market faced very significant challenges as of 2023-2024.  EV sales represent a modest market share in most nations.  Charging station networks are not well developed, and many potential buyers are concerned they will not be able to recharge when needed, particularly on long trips.  Batteries remain costly.  EV sales are so small compared to the expenses involved in manufacturing EVs that some manufacturers, including Ford and Rivian, are estimated to have been losing from $10,000 to $30,000 on each EV sold.  Tesla is faring better, with its substantial sales base, but its ability to earn a profit has largely hinged on the fees it earns by selling by selling “carbon offset credits” (nearly $2 billion in some years) to other car companies that do not meet emissions standards set by the State of California.  Meanwhile,  the world’s reliance on much of the EV supply chain coming from China, as well as controversy over the environmental challenges in mining and utilizing cobalt, nickel, manganese and other metals in batteries, pose other challenges to this sector.  The bottom line is that it remains to be seen whether or not either governments’ goals or car manufacturers’ goals for EV production and market share can be met over the mid-term. 

     General Motors (GM) had plans to invest $27 billion in electric and autonomous technology (including 20 new electric models by 2023).  Over the mid-term, even greater sums will be required.  New GM vehicles include an all-electric Hummer SUV.  GM is building a $2.3 billion battery plant in partnership with LG Chem Ltd. in Ohio and has plans for a third electric truck plant.  In addition, GM is partnering with Honda to jointly develop new vehicles including a driverless shuttle and two electric Honda vehicles using GM’s technology.
Electric pickups are garnering the lion’s share of EV attention in the U.S.  Plug-in versions of the Chevy Silverado and the Ford F-150 have hit the market.  Production of the $105,000 fully loaded electric Silverado sold out in 12 minutes in 2021, while Ford logged more than 200,000 customers who spent $100 to reserve the electric F-150 Lightning pickup before it hit the market in the spring of 2022.  Tesla hoped to deliver its first Cybertruck pickups in late 2023 (originally planned for 2021) while Rivian Automotive delivered the first of its R1T pickups in 2022.
In September 2021, Ford announced that it is partnering with South Korean firm SK Innovation to invest $11.4 billion to build an electric F-150 assembly plant and three battery plants in the United States in Kentucky and Tennessee.  Ford now expects to have 40% to 50% of its global vehicle volume to be all-electric by 2030, up from its prior forecast of 40%. 
SPOTLIGHT:  EVs Transform Detroit
The shift away from internal combustion engines (ICEs) is changing the face of automotive manufacturing in America and elsewhere.  Vehicles that run on batteries require fewer parts than ICEs, making them less labor intensive to produce (needing about 30% fewer manufacturing workhours from start to finish).  Yet another facet to the EV industry is the relative ease of production compared to that of internal combustion engines.  According to Volkswagen, EV production takes 30% less effort that internal combustion vehicles.  Ford concurs, saying that the simplified production of EVs could lead to a 30% reduction in labor hours per vehicle (which is not good news for the United Autoworkers Union).
On the other hand, EVs rely on electrical engineers, software developers and other technicians and researchers, which may offset at least some of the job losses.  Plants are undergoing major conversions. 

     Mercedes-Benz announced plans to go all electric by 2030, investing more than $47 billion in this strategy over the mid-term.  Volkswagen is investing in standardizing electric components such as batteries and software across its brands, including Audi and Porsche.  
Tesla is the rock star of the electric car industry.  Its sales have been impressive, despite the relatively high price of its initial models, and the company’s own stock has soared, thrilling early investors.  Tesla's high-end Model S sedan is costly but nonetheless popular.  It also offers the Model X SUV and Tesla offers a Model Y compact crossover that was first released in 2020.  The Model 3 sedan, first released in 2017, has a base price significantly lower than the luxury models.  
A Shanghai Tesla plant is producing Model 3 sedans and a Model Y crossover designed specifically for the Chinese market.  The company also has a massive network of Tesla-owned charging stations.  As of early 2023, Tesla’s Supercharger network (where Tesla owners can get a rapid recharge of batteries) had more than 40,000 stations worldwide, including about 17,000 in the U.S.  Tesla recently agreed to open part of its U.S. charging network to certain non-Tesla owners.  Another player in this sector, Electrify America, had 839 charging stations in operation by early 2023.  The U.S. Government is providing massive financial incentives to qualified installations of new charging stations in America, both in homes and at commercial facilities.

SPOTLIGHT:  Charging Stations
There are three levels of EV charging stations.
=         Level 1 (120 volts), approximately five miles of range per hour of charging, typically at home.
=         Level 2 (240 volts), approximately 25 miles of range per hour of charging, again typically at home.
=         Level 3 (Fast Charging), approximately 100 to 200+ miles of range per 30 minutes of charging, typically at public charging stations.

     Stellantis NV, a firm created by the merger of Fiat Chrysler Automobiles NV and PSA Group, is investing more than $35.5 billion through 2025 on new plug-in models.  Stellantis plans to focus on battery development and sourcing.
China has imposed increasingly strict mandates boosting zero-emission vehicles due to the massive air pollution problem in Chinese cities.  Tesla began exporting its China-made Model 3 to several EU countries in late 2020.  The nation of India is also boosting sales of its electric vehicles.  India, China and the EU are all likely to see very high ratios of electric car sales by 2030.

Internet Research Tip: Electric Cars
For the latest on electric car manufacturers see:
Electric Vans and Long-Range Trucks:  Tesla has developed heavy-duty electric trucks capable of hauling major loads up to 500 miles at a price of about $150,000 and up (considerably higher than the price of traditional diesel-powered truck costs).  The first truck was delivered (about 3 years behind schedule) to PepsiCo in December 2022.  Other early orders were on-hand from major companies like Walmart and FedEx.
Daimler delivered its first Freightliner eCascadia all-electric semi in August 2019.  The problem with electrifying 18-wheeled trucks is the weight of including enough batteries to allow long driving range.  Other truck industry firms, including Volvo, Peterbilt and BYD are active in electric truck research or manufacture.  A diesel-powered engine weighs about two tons while an electric version with its batteries would weigh between four and nine tons, depending on range.  However, long-range heavy electric trucks face massive challenges, including, as of 2023, the lack of the specialized, high-capacity charging facilities needed at truck stops.
Improvements in EV technology are enabling the development of larger electric vehicles.  Retail giant Amazon is purchasing electric delivery vehicles from Rivian Automotive.  Amazon hopes to have 100,000 EVs on the road by 2030.
Electric vans are also being developed.  GM created a new company, BrightDrop, in early 2021 to manufacture the vehicles.  BrightDrop delivered its first 150 electric vans to FedEx in mid-2022.  Startup electric van manufacturer Canoo delivered its first electric vans to NASA in 2023, for use as crew transportation vehicles at the launchpad.

A Representative List of Organizations that Have Used our Research and Products:


I’m amazed at how much information is available and the various ways to access it. This will be a major resource for our serious job seekers.

Career Services, Penn State University

Plunkett Research Online provides a great ‘one stop shop’ for us to quickly come up to speed on major industries. It provides us with an overall analysis of the market, key statistics, and overviews of the major players in the industry in an online service that is fast, easy to navigate, and reliable.

Wendy Stotts, Manager, Carlson Companies

I really appreciate the depth you were able to get to so quickly (for our project). The team has looked through the material and are very happy with the data you pulled together.

Hilton Worldwide, Marketing Manager

We are especially trying to push Plunkett since all of our students have to do so much industry research and your interface is so easy to use.

Library Services, St. John’s College

We are especially trying to push Plunkett’s since all of our students have to do so much industry research and your interface is so easy to use.

Gary White, Business Materials Selector, Penn State University

Your tool is very comprehensive and immensely useful. The vertical marketing tool is very helpful, for it assists us in that venue, as well as targeting customers’ competition for new sales…The comprehensive material is absolutely fabulous. I am very impressed, I have to say!

Tammy Dalton, National Account Manager, MCI

The more I get into the database, the happier I am that we’ll have it–REALLY happy!!! Between the quality and affordability of your product, its appeal to and value for our users, and the inestimably ethical and loyalty-guaranteeing conduct of your business, I will always have more than sufficient praises to sing for Plunkett Research.

Michael Oppenheim, Collections & Reference Services, UCLA

Plunkett Research Online is an excellent resource…the database contains a wealth of useful data on sectors and companies, which is easy to search and well presented. Help and advice on how to conduct, export and save searches is available at all stages.

Penny Crossland, Editor, VIP Magazine
Real Time Web Analytics