Why The U.S. Will Lag Behind The Global Transition To Electric Vehicles

As soon as 2023, people in India, Indonesia and the Philippines will find sticker prices on electric vehicles that rival their gasoline-powered ancestors, according to a report released today by the Rocky Mountain Institute, but it may take seven more years for the United States to reach the same threshold.
The American fondness for big cars will keep it stuck longer in the fossil era of the internal-combustion engine, according to RMI’s “Breakthrough Batteries” report, because petroleum-powered big cars will remain cheaper for longer.
“Markets like India that use smaller and lighter EVs are expected to become competitive well before markets where larger vehicles dominate,” the report says.
Electric vehicles are already cost-competitive over their lifetime in most markets, but the initial purchase price remains higher—largely because of battery requirements—and that higher purchase price discourages adoption.
Smaller batteries suffice in markets that favor smaller vehicles, RMI says, and by the time the U.S. reaches capital-cost parity, places like India, Indonesia and the Philippines could already have 80 percent penetration of EVs.
Many of those locations favor two-wheel and three-wheel vehicles over four wheels, and even the four-wheel vehicles tend to be smaller.
The report suggests that those promoting EV use in the United States concentrate their efforts on U.S. markets that also favor smaller vehicles, such as cities:
“Investors, policymakers, and market players should consider that: • Urban and smaller-vehicle markets are important first markets for scaling electric mobility. • Alternative business models and strategies like mobility as a service that can leverage disruptive innovations related to autonomous driving may be needed to rapidly electrify markets that have a strong consumer preference for large vehicles. • Battery innovations and improvements, including beyond Li-ion chemistries, will be important for personally owned, heavier EVs.”
Technologies beyond today’s standard lithium-ion battery, such as batteries with a Li-nickel cobalt aluminum (NCA) cathode, hold promise for allowing smaller, lighter batteries and lower costs in larger vehicles, RMI says.
MORE FROM FORBESHuge Battery Investments Drop Energy-Storage Costs Faster Than Expected, Threatening Natural GasBy Jeff McMahon