Electric Vehicle (EV) Market Trends To Watch In 2022
Updated: 6 days ago
Anyone who drives a car with an internal combustion engine has noticed that gas prices have gone up considerably recently. Although this is bad news for the pocketbook, it is fueling increased demand for electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs). There have gradually been more EV models on the market each year, giving drivers more purchasing options.
Certainly, 2022 is a dynamic year for EVs and their ever-increasing market growth and market share. So let’s examine what to expect this year in the EV market.
OEMs And Private Sector Companies Pledge To Electrify
More than 200 corporations and organizations have committed to reducing carbon emissions and having net-zero carbon emissions by 2040. As concern about climate change increases, many corporations are setting targets to reduce greenhouse gas emissions and meet consumer demand.
Some of these corporations have large vehicle fleets that must transition to zero-emissions vehicles to reach their carbon emissions targets, including heavy-duty vehicles, delivery vans, buses, and other commercial vehicles. Numerous large corporations are electrifying their fleets, including Amazon, UPS, FedEx, DHL, PepsiCo, Hertz, and Frito-Lay.
In addition to large corporations, small and medium-sized organizations also see the benefits of vehicle electrification, including some schools, transit agencies, delivery fleets, and local governments. These emissions reduction targets will fuel further electric vehicle sales growth for many vehicle types across North America and beyond.
This flurry of activity creates opportunities for EV professionals to offer guidance on transitioning to EVs and creating the charging infrastructure needed to make EVs a smart business decision. Although the focus is generally on the production of EVs, the charging infrastructure is also critical to keep up with charging demand.
Continued Investment In Charging Infrastructure
Clearly, the demand for charging infrastructure depends on EV ownership. In particular, demand for fast chargers is increasing as more drivers want to be able to charge quickly while on the go. Although many early adopters were happy charging at home, there has been a recent increase in demand for public charging as a larger percentage of the population drives electric cars and the global electric vehicle market expands.
In fact, a study from Roland Berger showed that the lack of charging infrastructure and long charging times concern EV drivers. This trend is likely to increase as EV ownership becomes more widespread unless robust infrastructure is put in place quickly.
Therefore, charging infrastructure must be developed to keep pace with increased EV ownership. In particular, issues of low charging station density in some areas and inadequate fast charging options need to be addressed. There has also been concern that EV chargers are disproportionately located in middle and upper-class neighborhoods, creating an additional hurdle for low-income EV drivers. Likewise, people who live in apartment buildings may find it difficult to charge at home, making convenient public charging infrastructure critical for overcoming this obstacle.
Unfortunately, EV charging stations are sometimes clustered in certain areas, while some have few charging options. For example, Europe currently has 374,000 public chargers. However, two-thirds are located in five countries: Germany, the United Kingdom, the Netherlands, France, and Italy. The National Highways Authority of India plans to install EV chargers every 40 – 60 kilometers, totaling 700 chargers by 2023.
Many governments across the globe are creating subsidies for installing EV chargers to help overcome infrastructure issues. In the United States, the Biden industry announced a plan to create half a million EV public charging stations by 2030. The Chinese government announced a goal to install enough EV chargers in China for 2 million vehicles by 2025, and in Toyko, the government unveiled plans to have 150,000 public charging points across Japan by 2030.
In addition, incentives for installing home EV chargers are also helpful. In the United States, there are some state incentives and utility rebates for installing home EV charging stations. Some states also have incentives encouraging EV ownership, and some, such as the Clean Fuel Reward Program in California, have incentives specifically intended to low and moderate-income residents.
Although there are also federal tax credits for purchasing many new EVs, many experts say that greater EV adoption relies largely on adequate charging options. As a result, EV ownership is much less appealing if charging needs aren’t properly addressed.
Range Anxiety Should Dissipate Among Consumers
One trend in the battery electric vehicle (BEV) market is that their range has increased in recent years with advances in battery technology. For example, the Tesla Model S has a range of 405 miles and the Mercedes EQS’s range is 485 miles. By contrast, when the Nissan Leaf hit the market just over a decade ago, its range was about 100 miles.
Greater vehicle range makes EVs more appealing to a wider segment of the population, helping EVs to go mainstream. However, as the range increases, also having more public fast-charging stations available would help with EV adoption, especially for drivers who like to travel greater distances from home.
HOAs And New Builds Are Getting EV-Ready
Many people now see EVs as the future of transportation. Therefore, some HOAs, condo boards, real estate managers, and construction companies are planning accordingly and are installing EV chargers on new construction projects.
The foresight for these initiatives can be really helpful in ensuring that charging stations are conveniently located and integrate well with the building’s electrical system. In some states, right-to-charge laws make it easier for people in multifamily dwellings to charge at home.
Bidirectional Charging Takes Center Stage
Although we usually think of power flowing into batteries, it can also flow out of some EV models to supply power. EVs with bidirectional charging capabilities can power loads and even a home or other electric cars from an EV battery.
However, very few models have these abilities. If more EVs are developed with bidirectional charging capabilities, it will make EV ownership even more appealing.
In areas prone to blackouts, this feature helps prevent the disruption of grid outages. It also enables EV drivers to have electricity where there is no utility grid, such as on project work sites or on camping trips.
EVs could also help power the electrical grid with Vehicle to Grid applications. This could enable utility companies to meet peak energy demand without firing up more power plants. This is an especially attractive way to incorporate more renewable energy into the utility grid by overcoming some of the issues related to intermittency.
More Automakers Offer EVs
Although certain automakers, such as Tesla, Volkswagen, Hyundai, BMW, and General Motors, have led the way in EV sales, more automakers are stepping in. For example, Rivian is releasing the R1T and R1S this year, and the Ford-150 Lighting EV is gaining a lot of public attention. Whereas compact EVs once led the market, there are now all-electric pickups, SUVs, and luxury and sports cars. Fuel cell electric vehicles (powered by hydrogen) have not caught on and make up a tiny market segment in the industry.
Other automakers are ramping up their EV plans and strategy, while also investing in battery technology. For example, Toyota plans to release 15 EV models by 2025, and Nissan plans to have 23 EVs by 2030.
Honda and General Motors recently announced a joint venture to produce EVs for under $30,000 starting in 2027. Both companies are researching the use of next-generation battery technologies, including solid-state batteries, instead of using lithium-ion batteries because they are lighter weight and could have greater energy density.
Although some automakers are having issues keeping up with EV demand, 2022 will be a big year for the industry. Some issues with supply chain shortages due to the pandemic have impacted the automotive industry, and computer chip shortages have temporarily shuttered manufacturing plants. However, this is an industry-wide issue and not specifically related to EVs.
EVs Will Continue To Drive Trends Through 2022 And Beyond
Regardless of some supply chain issues, the electric vehicle market is heating up, fueled partially by corporations electrifying their fleets and the federal EV tax credit increasing demand. As EV ownership increases, it is critical to also fortify EV charging infrastructure. As demand for EV chargers increases, some HOAs, management agencies, and construction companies are looking for ways to incorporate EV chargers in new construction projects.
This creates opportunities for EV professionals to build the infrastructure needed to electrify transportation. In addition to home chargers, some homeowners are also adding solar panels to produce the energy for charging.
As the range of EVs increases, there will be less range anxiety related to zero-emissions vehicles. However, increasing the availability of fast public chargers will help the EV market to continue to thrive. Governments around the globe are offering incentives and subsidies to help build a robust public charging infrastructure.
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