As EV sales growth slows, the industry faces bankruptcies and new challenges

Caleigh Wells Jun 18, 2024
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Among drivers of gasoline-powered cars, EV sticker prices and range limitations are key concerns about switching. Above, Fisker vehicle chargers. Jay L. Clendenin/Getty Images

As EV sales growth slows, the industry faces bankruptcies and new challenges

Caleigh Wells Jun 18, 2024
Heard on:
Among drivers of gasoline-powered cars, EV sticker prices and range limitations are key concerns about switching. Above, Fisker vehicle chargers. Jay L. Clendenin/Getty Images
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COPY

The hurdle-strewn electric vehicle market has claimed another victim: EV maker Fisker has filed for bankruptcy not even a year after it delivered its first cars to buyers. Fisker joins electric truck startup Lordstown Motors and e-bus maker Arrival in bankruptcy.

There are a lot of reasons for those companies’ troubles, but at the heart of the matter? The market for EVs isn’t panning out to be quite as powerful as a lot of people assumed. Plus, some EV owners seem less than enthusiastic about their purchases.

Let’s clear two things up: First, the No. 1 car sold last year globally was the Tesla Model Y. Second: EV sales are still increasing. They’re just growing more slowly than last year.

John Helveston, an engineering professor at George Washington University, said Tesla is such a big piece of the market that its recent slowdown makes the whole industry look bad.

“But really, when you look at other automakers like Hyundai, Kia, Ford, GM, they’re actually experiencing still a lot of growth in EVs,” he said.

The Fisker bankruptcy comes on the heels of a McKinsey report that said more than a quarter of EV owners are considering a gasoline car for their next purchase.

“That doesn’t sound good, but you have to also recognize that means that, you know, three-fourths of the people had a good experience and are keeping them,” Helveston said.

There are still barriers. The majority of U.S. drivers still drive gas cars, and the majority of them cite two main concerns: sticker price and range anxiety, said Gil Tal, a professor at the University of California, Davis.

“Not everyone is buying expensive cars, so we need to have the entire price range. We need much more infrastructure. It’s coming a little bit slower than I’d hoped it will be here,” he said. 

So the slowdown isn’t based on a lack of interest in EVs, mostly just hesitance. Stephanie Valdez Streaty, Cox Automotive’s director of industry insights, said solutions to those problems are on the way.

“There’s going to be standardization, which is going to be key. So no matter what EV you have, you can go to any charging station,” she said.

Meaning more chargers will be available to more car models. All major automakers will adhere to the same standard by 2025.

Valdez Streaty said cheaper models are on the way too. And, catering to the American preference, bigger models as well. “Big family, you want an SUV with three rows, more options,” she said.

The experts say the goal in several states to zero out gas car sales by 2035 is still within reach. But considering that the enthusiastic adopters are already accounted for, getting there will be more difficult.

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