When the Prius came onto the market in 1997, it was the only one of its kind. But the electric vehicle market has exploded over the past twenty years. And 2017 was the best year yet, with more models, manufacturers, and types of vehicles making their way to the mass market than ever before. How did we get here? And what does the future hold? Let’s take a look.
Electric vehicles enjoyed an early heyday, from the 1890s to the 1920s. In the 1920s, a combination of consumer demands for more speed and range, combined with low gas prices, made gas-powered cars a more popular choice. And by 1935, electric cars were few and far between. The oil crisis in the 1970s, combined with increasing environmental awareness brought renewed interest in the electric car. However, the electric car wouldn’t become a widespread market force again until 1997, when Toyota released its Prius Hybrid. The Prius, which combined a gas engine with an electric motor, solved the problems of power and range. In addition, strict new emissions regulations made both consumers and manufacturers start to think seriously about electric cars again.
The Current Electric Vehicle Market
Today, there are twenty models of electric car available on the mass market. Another thirty-seven models are planned for between 2018 and 2020. China is currently the largest consumer of electric automobiles, followed closely by the United States and Europe. Norway has the largest percentage of EVs in its domestic auto market — 52 percent. In 2017, global electric and plug-in car sales surpassed one million for the first time. And the International Energy Agency predicts that another nine to twenty million electric vehicles could be on the roads by 2020.
Cities are doing a lot to encourage people to buy electric cars. London, for example, waives its traffic congestion charge for electric car owners. Amsterdam will install charging stations in areas where people request them. In the United States thirty cities, including Los Angeles, Seattle, and Portland, OR, have made a pact to buy electric vehicles for their public service fleets. These will include police cars, street sweepers and garbage trucks. In addition, states like California are bolstering their electric vehicle market with emissions regulations, and laws that increase the ratio of alternative fuel vehicles to gas vehicles over time.
Who is making these vehicles? A lot of familiar faces. Toyota and Tesla, sure. But also BMW, Hyundai, Kia, Chevrolet, Ford, and many others. And electric cars come in more than just a Prius-sized sedan. You can buy a zippy hatchback, a supercharged SUV, a minivan, numerous sports cars, and more.
The average price of a mass-market electric vehicle is $34,721, which is similar to many fossil fuel vehicles. As regulatory support from the federal government is important for growing the electric vehicle market, it’s unclear to what degree this level of growth will continue.
Hybrid Car Market Analysis
Passenger cars make up the largest and most lucrative segment of hybrid sales. Popularity is increasing in Asia, North America, and Europe. Manufacturers are looking to Brazil as another potential large-scale customer, though other alternative fuels such as ethanol, are more popular there. Sales of hybrids in Japan are double what they are in the United States. This comes as little surprise, as Japan was the first mass-market to embrace the Prius, back in 1997.
Expect to see continued participation in the electric vehicle market from major Japanese automakers. Toyota, Honda, and Nissan in particular. Ford will also continue to play a part. In addition, expect participation from some European automakers like BMW and Renault.
Electric Vehicle Market Forecasts
2016 set a record for electric vehicle sales worldwide. 2017 saw a new record of over one million total units sold. And many experts are expecting future sales and adoption of electric vehicles to be even greater than they’d originally thought. OPEC, in particular, revised their own estimates up by 500 percent, according to Green Tech Media. And they must be scared. Green Tech Media also reports that Bloomberg New Energy Finance believes electric vehicles will make up on third of the new vehicle market by 2040.
All of these optimistic speculations come down to one thing: battery cost. A combination of companies are throwing up ten new mass scale battery factories around the world. And when supply goes up, prices come down. This will make electric vehicles cheaper to buy, and cheaper to own. Add to the fact that battery technology is rapidly improving, giving greater and greater range between charges, and the future of the electric vehicle market looks very rosy indeed.
One potential hitch may come down to politics. Regulatory support from governments has been very important to the development of the electric vehicle market worldwide. Whether current governments, particularly in the United States, will continue to support the deployment of electric vehicles, will play an important role in the future of the EV. But for now, the future is bright.
Featured Image Public Domain, by Geralt, via Pixabay.