With the rise in global concerns about climate change, technological advancement, and the surging oil prices, the world is warming up towards a shift in overdependence on fossil fuels. Several countries around the world are acknowledging the need for sustainable and eco-friendly solutions to mitigate climate change. The automobile industry is among the sectors where this change is much deserved, and with the look of things, non-liquid fuels like natural gas and electricity are turning out to be the remedy for the menace in the transportation sector.
The invention of electric cars was more of a series of discoveries and inventions which started back in the 1830s when a Hungarian inventor, Anyos Jedik developed an early electrical motor. Various individuals and automobile companies continued to conduct multiple experiments with this new technology, and it was not until the mid-1990s when General Motors developed the first mass-produced, modern-age electric car known as the EV1. Fast forward to 2008, Telsa Motors produced a revolutionary electric car (the Roadster) which is the only vehicle of all-electric cars developed before that manage to travel more than 320 kilometers per charge, and reach an incredible top speed of 200km/hr.
Although electric cars still make up an insignificant percentage of worldwide vehicle sales, there is a growing global movement that seeks to put to bed the reliance on internal combustion engines. Some of the major automobile companies in the world including Toyota, Volvo, PSA Peugeot Citroen SA, Renault, BMW, Nissan, Volkswagen and Ford among many others have made significant investments to add new electric vehicle models into their portfolios.
Add the states and cities that have pledged to phase out gas and diesel vehicles from their roads in the next few decades into the picture, and you will understand how impactful the electric cars will be in future. Norway is leading the way with electric car sales accounting for more than 30% of all sales. Other countries that are committed to weeding out the fossil fuel-powered vehicles from their roads include China, UK, Netherlands, India, and France among others.
A Sneak Peak of How EVs Operate
Unlike the contemporary fuel-powered engines, an electric car is propelled by an electric motor (s), which draws energy from rechargeable lithium batteries. Motorists are supposed to carry portable EV charger which they can use to charge their automobiles in the vast EV charging networks on the streets. While the EVs have proven to be cost-effective and eco-friendly, one of the biggest challenges is the unavailability of enough charging stations for those driving for long distances.
How the Electric Cars are bound to Change Our Future
Disruption of the Oil Industry
With various countries and states pledging to halt the production of gas and fuel-dependent vehicles by 2050, studies indicate that this will have pervasive economic effects on major oil-producing countries in the world (https://tonyseba.com/portfolio-item/rethinking-transportation-2020-2030/). Top oil exporters in the world including Saudi Arabia, Nigeria, Russia, and Venezuela will feel the greatest pinch. On the other hand, countries that produce lithium, cobalt, nickel, and cadmium such as Chile, Australia, Canada and Brazil among others, will start experiencing continuous economic growth. However, the impact will not be as robust as the oil industry since the politics of lithium and other components used to make batteries is entirely different from that of the former.
Impact on Jobs
While electric vehicles come with loads of benefits, they are less labor-intensive than fuel-operated automobiles during the manufacturing stage. Additionally, most of the processes involved in the development can be automated. For these reasons, it is estimated that the phase-out of combustion engines is bound to see most people lose their jobs. According to Info Economic Institute, Germany alone could see more than 600,000 people lose their jobs (http://www.cesifo-group.de/ifoHome.html).
Impact on Various Economies
If the ban on fossil fuel-dependent automobiles by various states and countries is achieved, the revenues generated by multiple governments from petroleum and oil products will plummet significantly. Countries that rely heavily on oil-related taxes will have to come up with new ways to boost their revenues. For example, the US government could lose up to $50 billion from petrol taxes if they fully adopt electric vehicles (https://tonyseba.com/portfolio-item/rethinking-transportation-2020-2030/)
What the Future Holds
While details are still sketchy regarding the level of commitment on the part of countries that have pledged to align their future transportation plans to electric vehicles, some of them have come out strongly to support the shift.
For instance, according to the Norwegian government, the electric car sold by Dec 2018 accounted for up to 30 percent of all vehicle sales. This has been achieved through various incentives which include exemption of electric vehicles from value-added tax, traffic insurance tax, one-off registration tax and leniency on a myriad of other restrictions. Conversely, China is following suit with one of its technology hub, Shenzhen leading the way with a vast array of electric vehicles including buses.
Although the insignificance of electric vehicles in the global automobile market today make it hard to predict the potential disruptions it will bring, the early adopters are showing no signs of slowing down. Therefore, it is imperatives that governments, auto manufacturers and the key-stakeholders in oil industry make some tough decision that will allow them to move with the wave of electric vehicles.
What do you think?
I’d love to hear what you think.
Let me know by leaving a comment below right now.