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Tina Casey headshot

What's Holding EVs Back: From Low Supply to Lack of Inclusion

Corporate buyers face supply shortages on the fleet side. On the consumer side, automakers market EVs primarily to certain demographics, limiting their consumer base.
By Tina Casey
electric vehicles (EVs)

Now that electric vehicles (EVs) are coming down in cost, forward-looking fleet managers are ready to make the switch. Unfortunately, that can be an exercise in frustration. Supply has yet to meet demand, and the bottleneck is especially acute in the U.S. Nevertheless, there are indications that fleet managers can start planning now for an all-electric future.

The electric vehicle chicken-and-egg

The electric vehicle market is still bedeviled by the chicken-and-egg conundrum. Automakers won’t manufacture EVs until they see demand, and drivers won’t demand something they can’t see.

Government mandates and incentives can get the ball rolling, but the U.S. is lagging far behind other nations in that area.

Still, signs of change are slowly beginning to emerge. The technology is improving, the nationwide EV charging station network is expanding, and drivers are becoming more aware of the convenience of charging up at home or at their workplace.

Pushing the envelope for EVs

The real problem is the pace of change. With the climate crisis already under way, accelerating the shift to electric vehicles is imperative.

To that end, international nonprofit The Climate Group has enlisted leading global companies to push demand by pledging to make electric vehicles “the new normal” by 2030 — just 10 years from now — under an initiative called EV100.

The impact goes beyond transitioning the fleets of member companies. The 67 corporate members of EV100 represent 3.4 million employees, who also form a potential market and can spread the EV message to family and friends.

In addition, many member companies are part of the automobile leasing market. For these members, fleet electrification is not counted by the hundreds. It translates into demand for tens of thousands of vehicles, and more.

For example, last week Lloyds Banking Group became one of EV100’s newest members, with a pledge to convert its 12,000 vehicles to EVs. That’s actually small change compared to the firm’s subsidiary, Lex Autolease, which committed to convert its fleet of approximately 350,000 customer vehicles. 

Schneider Electric ups its commitment to EVs

Another newly announced EV100 member with a broad impact is Schneider Electric. The company has pledged to transition its own fleet of 14,000 vehicles. That’s a drop in the bucket compared to the potential ripple effect on other companies and individual car buyers.

Schneider Electric is in the energy management business, which puts it in a direct position to influence EV ownership far beyond its own fleet and employees.

The EV100 initiative has already networked Schneider Electric in with scores of other leading corporate members, and the company plans to leverage its membership in two other Climate Group initiatives, RE100 for renewable energy and EP100, which focuses on energy efficiency and productivity.

Diversity, meet EV policy

Schneider Electric also may have a secret weapon up its sleeve. The company earned a spot on Fortune’s 2019 list of Best Workplaces for Diversity. That focus on diversity could position the company to identify obstacles and opportunities for EV ownership among different demographic groups.

Diversity is especially important in a market like the U.S. So far, Tesla is leading the U.S. in electric vehicle sales, but its focus on the luxury market has skewed its customer base heavily toward older, higher-income white men.

As impressive as the EV100 collaboration is, individual car buyers can still make or break the pace of the EV transition. Global EV sales slumped slightly last year even though other, non-Tesla automakers introduced dozens of new models, indicating that the attraction of electric mobility hasn’t caught hold yet.

With a global economic slowdown looming, the prospects for a significant bounce in sales this year are fading. 

Nevertheless, policies could fill in the gap with mandates and incentives. White House policymakers have been working to relax national fuel efficiency and emissions standards. But the Department of Energy sent a strong signal in the opposite direction last month with significant new funding for initiatives that could help accelerate the EV transition.

Along with a full slate of R&D programs for electric vehicles and related technology, the Energy Department is making the case for affordable EV ownership, partly by raising awareness about the impact of fuel costs on household budgets.

The fresh burst of activity may also vindicate General Motors. The company earned a torrent of criticism from EV advocates last fall when it joined several other auto manufacturers in challenging California’s bar-setting status on fuel efficiency and vehicle emissions.

GM argues that it supports a 100 percent EV future through national policy rather than a state-by-state piecemeal approach.

Between the EV100 fleet commitments, new EV commitments by UPS and other non-EV100 owners, plus recent Energy Department activity, the prospects for a rapid EV transition in the U.S. look brighter than ever.

Image credit: Nissan USA

Tina Casey headshot

Tina writes frequently for TriplePundit and other websites, with a focus on military, government and corporate sustainability, clean tech research and emerging energy technologies. She is a former Deputy Director of Public Affairs of the New York City Department of Environmental Protection, and author of books and articles on recycling and other conservation themes.

Read more stories by Tina Casey