One of the hottest automotive trends of recent years has been the rise of the Electric Vehicle (EV). With companies like Tesla setting the pace, it is no surprise that many other manufacturers have placed a greater emphasis on introducing more EV’s into the market.
Of all the OEM’s struggling to keep up with Tesla, none seems to be more dedicated to developing EV’s than General Motors. GM recently reinforced this position with the announcement of an upcoming electric crossover SUV under the Cadillac nameplate. The announcement was made on the eve of the 2019 Detroit Auto Show, and confirms GM’s plans to set Cadillac apart as its lead electric vehicle brand.
With an estimated $1B -$6B required to develop a new EV, new electric vehicles will necessarily need to command higher prices to ensure profitability. Setting apart a luxury brand like Cadillac to compete in the EV market only makes sense. Development costs can be more easily absorbed through the luxury brand, and the lessons learned can later be passed down to more affordable vehicle lines. Positioning Tesla as a luxury brand certainly seems to have worked for them. As Tesla recoups its development costs through increased sales, there is now talk from Tesla of lower-cost Model 3’s that could appeal to the mainstream market.
As we look closer at the evolution of the EV, here are some thoughts to consider when anticipating what 2019 will look like in regards to electric.
The Rapidly Evolving EV Market
The fact that GM is branching out from the smaller EV’s and heading straight into a luxury SUV should tell us something about the direction the EV market is headed. Independently, the EV and SUV segments are both on the rise, but a foray into an EV SUV by a legacy manufacturer tells us that EV’s are here to stay. With GM taking the lead, look for Ford and other seasoned auto makers to follow their lead in the near future with EV SUV announcements of their own.
Heightened Emissions Requirement
Although the EPA under the Trump Administration is actively working to roll back some of the aggressive future Corporate Average Fuel Economy (CAFE) standards imposed under the Obama Administration, the fact remains that the target is still 35mpg by 2020, and will continue to rise. These higher standards force the OEM’s to produce more clean vehicles than ever before, or face stiff penalties. Look for EV’s to be an integral part of this transition to stiffer CAFE standards.
Improved Infrastructure
One of the biggest question marks surrounding the viability of electric vehicles has always been range – how far can you drive on a charge? Secondary to this question is – where can you recharge, and how long does it take for a charge? This concern is rapidly evaporating as technology improves. Tesla boasts ranges over 300 miles on models in their lineup and they recently set a new range record of 670 miles on a single charge. Furthermore, as batteries continue to improve and EV technology gets better, so does the infrastructure. There are massive movements going on currently by government and electric service providers in various locations around the US that aim to dramatically increase the availability of charging stations. Charging times are also dropping. In some cases, a charge can take less than an hour for a 70%+ charge. This means you can stop for lunch, and be back on the road in almost the same time it now takes to eat and refuel a gasoline vehicle. It will be exciting to see what new advancements and announcements 2019 holds in store for the EV.
