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Is the electric car industry running out of steam?

© Torsten Dettlaff

The year 2023 seemed to be a rather promising year for the sector, which saw its sales take off. EVs had even overtaken diesel cars, and the indicators look very positive. However, behind this growth lie complex and much less optimistic realities for manufacturers.

Sales on the rise, virtually at least

If l& #8217;we refer to the raw data, the first nine months of the year 2023 were much better than those of last year: EV sales increased by 43%. However, growth is not everything, and to fully understand the phenomenon, other important factors must be considered.

Tenors of the automobile industry, such as General Motors, Ford or Mercedes, put on a big braketo their investments. For the Volkswagen group, things are no better: their EV sales are collapsing and the production rate is slowing down, and certain models are even seeing their production temporarily stopped.

L& #8217;Chinese industry, which is most often presented as very dynamic and competitive, is experiencing its first bankruptcies; this is the case of the manufacturer Weltmeister for example.

Analysts from GlobalData, The Langston and JATO Dynamics point to a perverse effect to explain this imbalance: confusion between salesand deliveries. Many manufacturers have, in fact, delivered vehicles that customers had ordered a long time ago. On the other hand, the interest of new customers is not the same as that of these early adopters, and remains stable. Result: orders are falling.

The “Death Valley” of the electrical industry

The sector therefore seems to be entering a state of torpor, a critical period that analysts nickname: 'Death Valley'. A poor term to describe a situation in which production exceeds demand more than necessary. Result: the second-hand market is experiencing a significant devaluation.

The stagnation of interest between new consumers for EVs and early adopterspreviously city ​​is the central factorcausing this phenomenon. The obstacles to the adoption of an electric vehicle remain generally the same: prices too high, insufficient autonomy and a charging network that is too poorly developed.

The initial momentum of the sector and the global enthusiasm that EVs had generated are no longer what they were. Especially since forecasts assume that manufacturers' ranges will not really expand before 2025, which will further delay the arrival of affordable vehicles on the market. walk. We must therefore expect two rather difficult years for the sector, with operations significantly slowing down.

  • Despite an increase in sales, the electric car sector is not in its best form.
  • A phenomenon largely due to confusion between ordersand deliveries.
  • Production exceeds demand, which will necessarily lead to a slowdown in this industry in the years to come.

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Teilor Stone

By Teilor Stone

Teilor Stone has been a reporter on the news desk since 2013. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining Thesaxon , Teilor Stone worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my teilor@nizhtimes.com 1-800-268-7116