Something’s got to give – and will, soon.
Odds are it will be us. Giving more money, that is. Our punishment for not buying an electric car. Or put another way – to make it just as expensive for us to continue driving a non-electric car as it is to buy an electric car.
In order to “level the playing field.” Get ready – it’s coming.
It’ll be done in any of several ways. In China, people are allowed to drive non-electric cars, provided they pay an exorbitant fee – $14,000 – for the privilege. After winning a license plate lottery that allows them to pay the fee.
Winning the lottery can take years. But EVs can be registered immediately . . . and without the punitive fee. You just pay the punitive expense . . . for the EV.
In Western European countries, so-called “polluter pays” taxes are being applied to non-electric cars.
Bans on the use of non-electric cars in certain areas have also been enacted, transforming people’s non-EVs into UVs . . .
Such nudging is going to be necessary here, too – absent some sort of developmental miracle, because EVs as they are – as opposed to how we’re promised they will be – can’t compete on the economic merits.
It’s not a debatable point.
Put aside haggling over the electric car’s functional merits – or the lack thereof. Forget about their supposedly “zero emissions.” These are separate considerations.
The hard deck reality is that most people simply cannot afford electric cars – the least expensive of which (Nissan’s Leaf, reviewed here) starts at $30,000. The rest begin around $35,000 – and ascend from there.
Most people can’t afford a luxury car – which is what EVs are, in terms of what they cost. Which is at least twice as much as a current non-electric economy car.
But enormous numbers of these electrified luxury cars are going to be manufactured regardless of people’s ability to buy them – because of the willful refusal of the car industry to acknowledge the economic hard deck.
What will happen to all of these unaffordable EVs?
Tesla has already mopped-up most of the virtue-signaling affluent who can afford to virtue signal. Electric or not, the market for cars that cost more than $40,000 (the price of the least expensive Tesla, the Model 3) is much smaller than the market for cars that cost $20,000.
And the market for cars that cost more than $40,000 – which is most EVs – is even smaller. Especially when you take into account the peripheral but effectively unavoidable costs of EV ownership – including the $1,000 it costs to install a “fast” charger in one’s home and the certainty of having to spend thousands on a replacement battery at some point.
But the artificially mandated market for inherently small-market EVs is about to get a lot larger because almost every major car company has “committed” to building EVs en masse; several have “committed” to building nothing but EVs and within the next five years or even sooner.
The problem will be finding buyers for these EVs.
At least, so long as buyers have a choice.
The media image of EVs being both everywhere and inevitable for everyone runs up hard against the brick wall fact that in spite of all the hard-selling and subsidizing, EVs only constitute about 1 percent of all cars on the road.
This isn’t likely to change unless millions of average people find the means to spend 30-50 percent more for their next new (electric) car or the cost of electric cars goes down by 30-50 percent.
Is there any indication of either thing happening?
Most people have less buying power today than they did twenty years ago because of stagnant or regressive wages and lower discretionary income due to rising costs (especially for health insurance) and inflation. They can barely afford non-electric cars. Most new car loans have been pushed out to six or seven years in order to reduce the monthly payment but the problem is the principle – which continues to increase.
EVs will cause the principle to increase by the aforesaid 30-50 percent.
Loans can’t be pushed out much beyond eight years to make that more palatable because of depreciation – and electric cars depreciate faster than non-electric cars because of their built-in shorter economically viable lives. Their batteries will need to be replaced at least once for sure and probably before 10 years – again, assuming electric cars as they are and not as we are promised they will be … eventually.
But EV batteries are proportionately too expensive to be worth replacing after ten years or so for the same reason that it’s usually not worth putting a new engine in a ten-year-old non-electric car.
The only way this EVs-uber-alles regime works is if people – average people – suddenly have 30-50 percent more money available to spend on a new EV. Or if people are forced to give up their non-EVs via exorbitant fines designed to make them just as expensive as EVs; probably more so – to overcome the inconveniences of owning an EV.
Failing that, the EVs will sit.
And the car business – having committed to the EV business – will go out of business.
Grab a seat; the show’s going to be fun.
. . .
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