Enrique Dans
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Enrique Dans

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Does the automotive industry really believe in electric cars?

A good article in TechCrunch, “Automakers aren’t really advertising electric vehicles”, puts its finger on the true problem facing electric vehicles: the automotive industry is still dominated by petrolheads and has no interest in selling them.

The data speaks for itself: in the United States, the number of electric vehicles sold up to the end of November amount to a meager 133,854 out of total light vehicle sales of nearly 16 million. In Spain, the figure is 1,671 units out of a total 1,050,121 vehicles. The best-selling electric vehicle in the United States, the Tesla Model S, sold 23,571 units. Spain’s most popular, the Nissan Leaf, shifted 493 units. In the world, just 584,393 electric vehicles have been sold over the course of 2016.

The news is hardly surprising: we already know that electric vehicle sales are low: fourteen months of growth that have seen sales grow by more than a third over the previous year amount to little in the context of the low starting point.

But what makes the TechCrunch article interesting is the real reason why electric cars remain unpopular: the big brands don’t bother advertising them. The vast majority of car manufacturers, with few exceptions, devote their advertising budgets to pushing their gasoline or diesel vehicles, relegating electric cars to the distant sidelines.

The sad reality is that rather than pushing the development of electric vehicles, the car industry prefers to stick to what it knows and avoid change. But a small number of companies, most of them global operators and relatively stable, have the potential to use a technology to bring about change.

As a result, the big players have begun research into emerging technologies to avoid being left out in case the transition suddenly speeds up, but their money is on things staying as they are, and their assembly lines continue to churn out gasoline and diesel vehicles as if there were no tomorrow, and they continue to advertise them.

And so, in terms of R+D investment, electric vehicles are still very much the poor relative of the family. If, among the four Ps of marketing, publicity is handled so irresponsibly, little wonder that prices are set so as seeminly to drive customers away.

MIT research shows that electric vehicles can cover 87% of our needs, and by 2025 that figure will be 99%, and that is simply by recharging overnight. Few carmakers are bothering to advertise the ever-increasing autonomy of electric vehicles. The internal combustion engine must take a large share of the blame for pollution and should have been banned years ago. What’s more electric motors, in addition to being more efficient, are much simpler in design and suffer fewer breakdowns, which impacts on another revenue earner: repairs, servicing and maintenance.

Surely the time has come, to consider forcing the motor industry to change? The time has come to move from subsidizing electric vehicles to taxing those powered by diesel and petrol engines out of existence. Or maybe we should just impose a deadline.

We are dealing here with the orderly transition of an industry that may be viable under new rules, but that insists on playing by the old ones at any cost, prolonging an unsustainable situation for as long as it can. The automotive industry is irresponsible: it knows that build clean cars, but prefers to continue to poison us while talking about corporate social responsibility.

We have a right to expect the automotive company to announce a date, and soon, for the end of the production of dirty vehicles, but as far as I know one has not been set yet. The automobile industry is still run by the petrolheads and will require a lot of new blood if it is to change.

(En español, aquí)



On the effects of technology and innovation on people, companies and society (writing in Spanish at enriquedans.com since 2003)

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Enrique Dans

Professor of Innovation at IE Business School and blogger (in English here and in Spanish at enriquedans.com)