The Tesla Model 3 is now the best-selling vehicle in California in all categories, as it already is in the arguably less representative market of the Netherlands. The data is published by the California New Car Dealers Association, which is probably contemplating in despair how the best-selling vehicle is precisely one that does not get distributed through dealers. In short, Tesla’s achievement has been to make electric vehicles more desirable than their internal combustion competitors.
In case you hadn’t noticed, the automotive market is changing. GM is launching a new electric delivery van in a bid to prevent Tesla taking over that market the same way they did in the consumer segment, and announces plans to introduce at least 20 all-electric models in all categories by 2023. In the same sense, Amazon is working to add 100,000 Rivian all-electric vans to its delivery fleet.
Electric vehicles are no longer the preserve of the rich: China now produces models with starting prices of around $1,000 that you can buy through Alibaba. More and more manufacturers are accelerating their plans to try to position themselves in a market where it will take them at least several years to cast a shadow on Elon Musk’s company. But one thing is already clear: with much longer lifetimes and significantly cheaper maintenance costs, electric vehicles are changing the economic parameters of driving.
Several countries, such as Spain, France or Germany have recently announced new plans to promote the sale of electric vehicles, increasing incentives for their purchase, backed by a range of measures. Others, such as Turkey, are encouraging consortiums to make their own electric vehicles. In Germany, incentives coincide with tax hikes on large diesel vehicles, as well as obliging all petrol stations to install electric recharging points. In Spain, energy giant Iberdrola has accelerated its plans to develop an electric recharging network, also focusing on service stations with fast charging points, and intends to install 150,000 points in homes, businesses and in cities and towns over the next five years. For petrol station chains, meeting this growing demand is increasingly a necessity.
The clean air we have been enjoying during lockdown seems to have aroused consumer interest in electric vehicles. Some countries, such as the United Kingdom, have now brought forward the date for a ban on the sale of diesel and petrol vehicles to 2035. All those lies about electric vehicles, such as the long tailpipe theory have now been completely disproved by science: every electric vehicle substantially improves air quality, regardless of how the energy used to charge it is generated. The only excuse for not buying an electric vehicle is not having a garage where you can recharge it, although as growing numbers of drivers are showing, with a little organization, there are plenty of ways round that.
Understanding the impact of disruption on a market is fundamental for all its participants, both from the supply and the demand side. The automotive market is about to be seriously disrupted, so whether you’re in the market for a car or you sell or repair them, you might want to bear that in mind.