Why the U.S. Can’t Get on Board With EVs

Europe and China are all in on EVs, so what’s holding America back?

January 24, 2022

Electric Vehicle Charging

ALEXANDRIA, Va.—Electric vehicle (EV) sales made up about 4% of car sales last year in the U.S., while EVs made up an estimated 14% in Europe and 9% in China, reports Wired. Although the sale of EVs rose 88% year over year in 2021, the U.S. still faces hurdles that are preventing the embrace of EVs.

“Since EVs use emerging battery technologies, they face several significant technical, economic and social barriers to adoption, limiting EV penetration in the U.S.,” Pradeep K. Chintagunta, professor of marketing at the Chicago Booth School of Business, told Wired.

Barriers include resistance from consumers who want the convenience of fueling up with gas, a lack of awareness of the strengths of EVs, and cost, as electric vehicles can be more expensive than internal combustion engine (ICE) vehicles. Wired points out that the electric Ford Focus costs nearly twice the amount of gas-powered one.

Politically, President Joe Biden has a goal for EVs to make up half of all sales by 2030, and the Environmental Protection Agency rolled out new fuel standards, which mandate auto manufacturers must meet a fleetwide average of 55 miles a gallon for cars and light trucks by model year 2026, up from the 43-miles-per-gallon standard set by the Trump Administration for that year.

For vehicle model years 2023 to 2026, automakers must reduce their greenhouse gas emissions between 5% and 10% each year. Meanwhile, China and Europe have aggressively issued carbon-reduction policies that incentivize the production of EVs.

Bank of America analysts say that EVs will make up 20% of the car market by 2030, and Wired writes that a large number of these EVs are expected to be “compliance cars”—vehicles built by manufacturers solely as a box-ticking exercise to meet the strictest emission standards in the country, in California.

The number of charging points in the U.S. also is still a major barrier to EV adoption.

“Potential EV customers are concerned with keeping their vehicle juiced up for long trips, and for some journeys in the U.S., the lack of charging stations makes this impossible,” Alyssa Altman, head of transportation and mobility at the Cambridge, Mass., consulting company Publicis Sapient, told Wired.

Publicis Sapient data show that America’s 113,600 charging stations are unevenly concentrated in areas where EVs are more popular, like California.

Last year, the Biden Administration released details of its plan to build out EV charging infrastructure, reports The Hill. The plan calls for the creation of a Joint Office of Energy and Transportation between the Energy and Transportation departments, which will be tasked with implementing the charging network and other electrification provisions in the bipartisan infrastructure law.

China also has some of the same geographical issues that the U.S. does, including range anxiety, but it has successfully adapted EVs by a “leapfrogging effect.” Wired reports that its automotive industry didn’t have much experience in building combustion engines, therefore it could easily drop them when an alternative came round.

However, Tesla is bucking the trend of slow EV adoption in the U.S. Its global deliveries rose 87% last year to about 986,000. In the U.S. alone, Tesla sold about 352,500 vehicles in 2021, or about 72% of all battery-electric vehicles purchased, Motor Intelligence estimates. In comparison, Ford sold around 27,000 electric vehicles in 2021 and GM sold about 25,000 last year. For both companies, that accounted for less than 2% of their total U.S. sales.

A recent Convenience Matters podcast episode discusses how EVs are the future, and another episode explains how convenience retailers can attract and retain EV customers. A free NACS webinar helps retailers understand how EVs and environmentally conscious consumers will affect your business.

At this year’s NACS Show, we held three education sessions that focused on the opportunity that EVs bring to retailers. Receive six-month access to this primer on electric vehicles for $49.

Read more about electricity demand charges and what they mean for retailers’ ability to turn a profit from EV charging in the September issue of NACS Magazine.