In the race for electric cars, a road strewn with traps

published on Sunday, August 28, 2022 at 10:45 am

Driven by the authorities or their own commitments, the major car manufacturers have begun a radical shift towards the end of combustion engines and the advent of electric cars. But to achieve their ambitious goals, they have to overcome many obstacles.

Is there enough lithium and other raw materials needed to make electric batteries? Enough charging stations? How to ensure that the cars do not cost too much for the most modest wallets?

After the success of Tesla, which is built only on electric vehicles, most of the major groups in the sector plan to invest tens of billions of dollars in the coming years to renew themselves.

Stellantis (PSA-Fiat-Chrysler) wants to sell 100% of electric vehicles in Europe by 2030. Toyota plans to launch 30 models in this segment for the same date. General Motors aims to stop making cars with combustion engines by 2035.

They are encouraged in this direction by the authorities.

Most recently, California on Thursday banned the sale of traditional new cars from 2035.

– Ensuring the need –

The European Union has also begun banning the sale of new petrol, diesel or hybrid cars by 2035, while China wants at least half of new cars by that date to be electric, hybrid or hydrogen.

Car manufacturers are warned, “it is up to them to manage the preparation of their stocks”, said Jessica Caldwell, of the specialist company Edmunds.

“It has been said recently that the biggest obstacles to the adoption of electric vehicles are the acceptance of motorists and the price”, pointed out the specialist.

But driven by consumers who are increasingly sensitive to the effects of climate change, the demand is there.

In the United States, for example, General Motors claims to have more than 150,000 pre-orders for the electric version of its Silverado pickup, which won’t be available until 2023. It will take several months for a Tesla, the flagship brand in the sector. ..

“The question now seems to be more about whether they can get the necessary materials,” said Ms. Caldwell.

– “Drastic” transfers –

“Governments can decide as much as they want on subsidies or new regulations for electric vehicles, we are currently facing a shortage of palladium, nickel, lithium”, many Karl Brauer on the specialist site iseecars.

True, the problem is largely linked to the conflict between Russia and Ukraine, but “no one could have predicted the rise in prices or the difficulty of obtaining these materials a year ago”, he recalled. Which highlights the fact that the situation “can change dramatically at any time”.

Manufacturers struggle to limit risks.

They build their own battery factories, create joint ventures with specialized manufacturers or partner with mining companies.

German groups Volkswagen and Mercedes-Benz even signed agreements directly with the Canadian government on Monday to consolidate their supply of rare metals.

But the market remains, as for oil, global, remembers Mr. Brauer: as long as the supply is limited, “there will always be someone who will pay a little more”.

In this regard, other aspects of the transition to electricity such as the conversion of production lines will eventually be easy ​​​​​​”because they can control it”, he said.

– Assistance subject to conditions –

Local regulations can also complicate the task, such as in the United States where a recent law has set a subsidy of 7,500 dollars for the purchase of an electric car in certain elements, such as a final assembly in North America.

The Automotive Innovation Alliance, an industry lobby in the United States, calculates that around 70% of the 72 electric, plug-in hybrid or hydrogen models currently on the market cannot, as they stand, achieve this. grant

For Garrett Nelson, CFRA analyst, this new law will clearly favor Tesla, GM and Ford in the United States, to the detriment of manufacturers in Europe and Asia.

After the announcement in California, the Alliance for Automotive Innovation also estimated in a press release that it is “extremely complicated” to achieve the state’s goals due to “external factors”: inflation , electric or hydrogen charging stations , supply chains, labor, availability and price of critical materials, and the continued shortage of semiconductors.

“These are complex, intertwined and global issues that are beyond the control of (California authorities) or the auto industry,” the Alliance said.

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