Manufacturing problems and material shortages mean it’s becoming harder to produce the promised product.
Central Europe needs to get on the EV train, and fast
It’s survival of the fittest: Central Europe will be left behind unless they begin to speed up their transition to EVs. Recently, the prime minister of the Czech Republic criticized the EU’s Green Deal as an “existential threat”, due to the importance of the car industry to its economy. However, while this may be the case, it is also because the country has not prepared effectively enough to handle the transition to EVs, Politico reports. With Brussels setting a goal of climate neutrality by 2050, whether or not the Czech Republic will be able to keep up is another question entirely.
Currently, Europe is building its EV industry with major carmakers deciding where the EV only factory hubs will be. Slovakia is a frontrunner in Central Europe at the moment, so if the Czech Republic wants to keep up and remain a major car producer, it will need to step up its game. It does remain a contender to be chosen for a gigafactory – but with millions of jobs on the line, it remains important that the country allocate more funding to the production of EVs, as well as incentives for its population to switch from gas to electric. With other Central European countries eager to secure a place in what is looking like an overhaul of the car industry, it is truly a race to see who will come out on top.
Great expectations? Volkswagen claims it will overtake Tesla
Volkswagen’s chief executive Herbert Diess is making plans. As in, planning to overtake Tesla as the world’s largest seller of EVs by 2025. That’s what he’s claiming will happen, anyway. According to Diess, the automaker will be able to leverage some momentum from the relief of supply chain issues. Tesla, on the other hand, is currently opening new plants and might therefore find it difficult to ramp up more, CNBC reports. Diess claims that despite production issues and material shortages, which have been rampant in the EV industry since the start of the coronavirus pandemic, there are signs that the car giant will be producing better results in the second half of the year.
However, Volkswagen’s Frankfurt listed shares traded 0.9% lower on Tuesday morning, alongside the losses being seen in the auto sector on the pan-European Stoxx 600. What Diess says may be true, but automaker rivalries aside, the EV industry still has a way to go before shortages smooth out, and production becomes easier.
EV prices soar as essential materials get more expensive
EVs are getting expensive. Automakers are raising prices for their electric vehicles, in order to combat changing market conditions and soaring commodity costs, CNBC reports. Even though batteries have been getting cheaper over the years, battery minerals are becoming increasingly scarce, which may soon lead to an increase in price. The surge in EV sales may slow down as a result, hindering the transition from gas to electric that has picked up its pace in recent years.
EV automakers such as Tesla and Rivian have already hiked the prices on their EVs, with most of their vehicles significantly more expensive than they were at the beginning of 2021. Other automakers are seemingly following suit, with GM having recently increased prices on its Cadillac Lyriq crossover EV by $3,000. With oil prices also surging, it remains to be seen if customers are willing to shell out more for a coveted EV, or if it’ll dampen the EV enthusiasm that is currently sweeping across the world.