2022 is promising to be big year for electric vehicles
EYDER PERALTA, HOST:
2022 is promising to be a very big year for electric vehicles. Major automakers are putting billions of dollars on the line as they bet on a switch to battery-powered cars. But this transition won't be easy. NPR's Camila Domonoske is joining us to talk about the road ahead for electric vehicles.
CAMILA DOMONOSKE, BYLINE: Hi. How are you?
PERALTA: Good. So how confident are automakers that this electric vehicle revolution is actually going to happen?
DOMONOSKE: It's funny. It used to be that Tesla was the only company saying electric was the future, but now pretty much every automaker is staking their future on this. Concern over climate change is mounting, and there's a lot of pressure to make this happen. There are some disagreements in the industry over how long it'll take, exactly, but everyone's racing to switch over factories and supply chains and design all these new vehicles. You know, this coming year, Ford is going to start delivering the electric F-150 Lightning pickup truck. That's a huge deal. General Motors is unveiling its electric Silverado in a few days. You've got big names like GM, Honda and Volvo saying they will only sell electric cars within the next decade or two. And then on Wall Street, there have been these super-buzzy IPOs with startups like Lucid and Rivian that are trying to be the next Tesla. And Wall Street is obsessed with them.
PERALTA: What about prices for electric cars? Are they going to come down?
DOMONOSKE: Yeah. Well, if you zoom out overall, they have come down a lot. And with economies of scale and if batteries get cheaper, they could drop more. They're already cheaper to own over the life of the vehicle, but that upfront cost - it's still about $10,000 more than the average gas-powered car. Now, subsidies can cut that difference. Right now there's a $7,500 federal tax credit for buyers, but it phases out once a carmaker has sold a lot of electric vehicles. So it actually no longer applies to the most popular ones, Teslas and Chevy Bolts. This is a major priority for President Biden, and his Build Back Better plan would have expanded that subsidy. But Senator Joe Manchin has put all of those plans on ice for now.
PERALTA: As you said, the Build Back Better package was supposed to give electric vehicles a big boost in this future, but it's stuck. Is that going to derail this revolution?
DOMONOSKE: The short answer is no. The long answer is it might affect the speed. I mean, one thing is there are other government policies, right? The bipartisan infrastructure package, which did actually pass - that included funds for charging stations along highways and in neighborhoods. That could remove a big barrier for people. The EPA also just strengthened its fuel economy standards. And building electric vehicles helps automakers meet those standards, so that could also move the needle. And then there's a lot of market forces - battery packs, the big packs that power these vehicles. If they keep getting cheaper, drives costs down. We're also about to see a ton more options, especially SUVs and pickup trucks, which Americans love to buy. That might affect sales. And then investors, like I mentioned, are really pushing this. That's helping create some change. But last but not least, I got to ask you, have you ever driven an electric vehicle?
PERALTA: No, I mean, where - I'm normally based on the African continent. They're just - they're not that available.
DOMONOSKE: They're not that common, yeah. That's really common. Lots of people haven't. If you do, they're zippy, and they're quiet. And those are two things that people really like. So a lot of auto executives have told me, look. People will want these vehicles as soon as they get to try them. So it's not like subsidies are going to determine if automakers start to build these vehicles. That is happening. But where it could play a role is the speed of how quickly prices come down, so people buy them.
PERALTA: That's NPR's Camila Domonoske. Camila, thank you so much.
DOMONOSKE: Thank you.
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