America’s electric vehicle market is in limbo. Although it is common knowledge that zero-emission vehicles will revolutionise mobility across the globe, playing a pivotal role in the decarbonisation of the countries economy, and EV sales have been rising steadily, mainstream adoption is still a long way off.
To put this into perspective, just one in 50 new cars sold is an EV.
But what is preventing widespread electric vehicle adoption? To find out more, I speak with Dr. Rebecca Yates, Product Development Director MMF and Driveline at Castrol who has led a report which examines five critical challenges that must be overcome to accelerate EV uptake.
“This is exactly what Castrol set out to uncover through our global study, Accelerating the EVolution,” she says. “We know that the future of the automotive industry is electric and that e-fluids play an essential role in that development, but we wanted to unearth what tipping points need to be met in order to achieve mainstream adoption.”
We are finally starting to see a shift, not only in market share but also in consumers’ demand over internal combustion engine vehicles. According to the study, most drivers in the US would consider an EV by 2025.
“This means that in less than five years we could see a huge shift towards consumers buying electric, which would completely change the market,” says Yates.
Although we have seen some form of shift, we are still nowhere near a majority share in comparison to conventionally-fueled vehicles. To change this, the industry must address the three major ‘tipping points’ to driving mainstream adoption.
Through its Accelerating the Evolution study, Castrol found that the three most critical tipping points for consumers are price, charge time and range. According to the research, within the US, consumers are looking for EVs to achieve a price point of $36,000, a charge time of 30 minutes and a range of 319 miles to enable mainstream adoption.
“Another important factor is charging infrastructure,” continues Yates. “ For example, 62% of US consumers would consider an EV if charging infrastructure existed to support their driving habits and vehicle choice, whilst 43% of US consumers say they’d consider an EV if a model equivalent to their favorite gasoline or diesel car existed.”
Once these essential aspects are addressed, we will get closer to achieving mainstream adoption, not only in the US, but across the globe.
Unlocking the Opportunities
EVs will create new benefits within the automotive industry from a business perspective, unlocking new opportunities for companies to exploit new verticals.
These new vehicles will play a fundamental role in the future of the automotive industry; Castrol’s research shows that there is a consumer desire to make the switch. According to Yates, manufacturers can use this opportunity to fill a void in the market, just like Castrol itself.
Being an established and, what many may call a ‘traditional’ automotive brand, Castrol has reacted to the rapidly developing market, evolving in tandem with EV development.
“We see our lubricants business continuing to play a vital role in this transition, as EVs need oils and other fluids to keep them running safely and efficiently. Because of this, we created a range of e-fluids to meet the needs of EV manufacturers and over half of the world’s major vehicle manufacturers already use them as part of their first fill,” she says.
For example, e-fluids include transmission fluids, which improve efficiency and extend the life of the drivetrain system, coolants keep batteries cool during charging and driving and greases help protect motor components, making them last longer. Together, these e-fluids can also extend the range on a single charge and contribute towards faster charging and cost of vehicle components.”
For Castrol, this is pretty straight forward, as the company can utilise its expertise in the lubricant market and apply it to a new range of vehicles. However, for automakers, this is a much more challenging and time-consuming transition. They must find a way to expand from their profitable internal combustion engine vehicles and ensure that they ‘bite the bullet’ without putting their overall business at risk.
“Because electric is the future of the automotive industry, manufacturers have already shifted their investment to electric for new model vehicles,” adds Yates. “As part of our research, Castrol developed a proprietary economic model to calculate what the annual size of the EV market could be by 2025. If all three tipping points – range, price and charge time – are addressed, we estimate that this could be a $108 billion market in the US by that time.”
By meeting the demands of consumers, there is an exciting opportunity to lead in this rapidly-evolving market.
Achieving net-zero carbon emissions is the industry’s main challenge at present, to help support the world’s recovery. As people and businesses make changes to help secure a cleaner and safer future for future generations, it is the automotive industry’s job to increase the popularity of zero-emission vehicles and illustrate the benefits over internal combustion engine vehicles.
“At Castrol, we know how big of a role the automotive industry plays in this objective,” says Yates. “As both consumers and businesses look for easy, yet largely effective changes they can make in their daily lifestyle and business, the EV market will continue to grow.”
With estimations that the EV market could be $108 billion in the US alone by 2025, with most consumers considering purchasing an EV in the next five years, the desire for EVs certainly exists. And, through its new data report, Castrol believes that it has truly identified the key components for achieving success.
Keyword: Accelerating the EVolution – Castrol’s Dr. Rebecca Yates