Affordability holding back EV uptake, not interest

Regulations in the US call for a sizeable increase in electric vehicle (EV) sales by the end of the decade. The Environmental Protection Agency (EPA) is proposing regulations that would essentially require EVs to account for 60% of the new vehicle market by 2030 and 67% by 2032. The proposal marks a more ambitious plan than President Biden’s previous target of 50% by 2030. In 2023, EVs accounted for just 8% of all new vehicle sales. Many automakers and dealers are concerned that the demand among consumers simply isn’t there to support such a target.

In November 2023, a group of dealers sent a letter to Biden asking that he “tap the brakes” on “completely unrealistic” EV requirements. They followed up with another letter in January 2024, this time more urgently requesting that he “hit the brakes”, pointing to “woefully inadequate charging infrastructure and insufficient consumer demand.”

It is widely accepted that charging infrastructure needs to grow. The government estimates that 2.8 million public chargers will be needed by 2032, up from a mere 170,000 as of January 2024. As for consumer demand, growth rates are indeed starting to slow. The dealers noted in their letter that the day supply of EVs on dealer lots today is nearly twice the supply of conventional vehicles. However, perhaps that is not down to lack of consumer interest, but rather the wrong sort of EVs.