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Too Many EVs
The Chinese government is encouraging consolidation amongst Chinese electric vehicle companies due to the belief that China has “too many” EV makers. The government is also improving its charging network and working to develop EV sales in rural markets. The promotion of greener vehicles to cut pollution has promoted electric car makers such as Nio Inc, XPeng Inc, and BYD Co Ltd to expand manufacturing capacity in China.
A global chip shortage is causing the industry and information technology Minister to find a solution for the chip supply shortage. Recently, China’s market regulator fined three auto chip sales companies for driving up prices to help auto production.
A Solid State of Mind
Improving and utilizing battery tech has become extremely important in the EV industry. Auto manufacturers such as Toyota have taken their first steps into advancing their battery technology. Toyota has committed $13.6 billion in the next decade to battery technology and has begun testing solid-state batteries in vehicles on the road.
Solid-state batteries have a higher energy density than Li-ion batteries and are more efficient. What to do with older lithium-ion batteries has become a big question, and recycling those batteries has become important for governments and companies prioritizing environmental health. LiCycle Holdings Corporation, a Canadian company, has announced plans for a lithium-ion battery recycling facility in Alabama. The facility is expected to open in mid-2022. This will be the fourth North American recycling facility for Li-Cycle.
EVs, Charging Stations, and Incentives
The EV market in the US has grown from a few thousand vehicles in 2010 to more than 315,000 vehicles sold annually from 2018 to 2020. States with zero-emission vehicle regulations had a combined new electric vehicle share of 5% and typically had at least 13 more electric models available than states without regulations. These states were responsible for about 2/3rd of 2020 US EV sales.
Electric vehicle growth is also linked to greater availability of public and workplace charging, therefore EV growth is not as substantial in rural areas. Unfortunately, half of the US population lives in an area with just 20% of public charging availability. Providing incentives for EVs also proves to be a great driver as the top 11 metropolitan areas in terms of EV uptake have strong incentives ranging from $1,500-$5,500. In summary, it seems simple to provide more EVs, more charging stations, and more incentives to grow the EV market.
US and EVs
Is the current EV incentive program flawed with the $7,500 tax credit and cap of 200,000 electric vehicles per manufacturer? The incentive takes the form of $7,500 tax credits, which requires you to have the equivalent federal tax burden. Democrats have proposed an updated EV incentive program, which would go through their $3.5 trillion social spending bill.
The program will remove the limit on the number of vehicles sold and the incentive would come in the form of point-of-sale instead of a tax credit. The bill also introduces a higher payout up to $12,500, but only for cars made in the US and using union employees. Toyota, Honda, and Tesla are not big on this stipulation. The bill will be voted on by the House Ways and Means Committee next Tuesday.
This week, Rivian became the first electric pickup truck maker to roll a customer R1T off the production line at its facility in Normal, IL. More R1Ts are expected this month and shortly followed by the R1S. Congrats Rivian on the tremendous milestone.
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