Global EV Market to recover from the COVID-19 pandemic sooner than expected
2020 has not been the best of yeas for businesses across different industries, with the pandemic, supply-chain disruptions, economywide lockdowns, and a worldwide recession leading to unprecedented times in the business environment. The electric vehicle market was not spared and with a historic decline in the prices of oil and fossil fuels cheaper at the pump, 2020 is looking like an especially rough year for the electric car market.
The COVID-19 crisis led to a sharp decline in global passenger electric vehicle sales. China is the world’s largest auto market and the country saw sales plunge by as much as 60 percent in February compared to the same month in 2019. The drop was due to a decline in consumer demand for electric cars before the pandemic, as a result of government phasing out subsidies.
The United States also had a fair share of the unfortunate situation, with EV sales in April falling by over 50 percent compared to the same month in 2019. This is following a down year for EV sales in America in 2019. It has not been the best time for top electric car manufacturers in the country, with Congress failing to extend federal tax credits for EVs in 2019 and ultimately removed a key incentive for the market. The current administration has also rolled back national fuel economy standards during the coronavirus crisis, making the regulations easier for companies to meet without selling EVs.
With economies opening up and global automakers getting back to business, the open question is how companies and governments will spend on new EV products and technologies. There are also concerns as regards sales incentives, public awareness campaigns, charging infrastructure, and other steps to help make electric vehicles go mainstream. While EVs have been predicted to go on a bumpy road for a couple of years amid the fallout from the COVID-19 crisis, experts have stated that they already see light at the end of the tunnel.
Several auto manufacturers such as General Motors, Volvo, and Volkswagen have expressed their commitment to vehicle electrification in recent times. According to GM’s vice president of electric and autonomous vehicles, Ken Morris, product development work on the company’s future EV portfolio “is progressing at a rapid pace” despite the global pandemic.
“I think we’re going to find a reluctance on the part of some consumers in the very short term. And I’m talking short term — six months, maybe a year,” Michigan Rep. Debbie Dingell (D-Dearborn) said on the Political Climate podcast distributed by GTM. “Then we need to ensure that the autos have the resources that they need [to bounce back].”
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