Inside the Electric Vehicle Market

by Diana Drake

Attention, all you new and aspiring drivers. Are you planning to go electric? The data suggests that you are. A recent poll conducted by, an online marketplace for vehicles, found that 56% of 1,000 respondents believe all teenage drivers will learn to drive an electric vehicle in the next 10 years. That’s you, behind the wheel, of a car that runs on battery power, not gasoline. As high school students who are just starting to drive and who care deeply about sustaining the health of our planet, the EV market has important implications. So, let’s dig in.

An Electrified Future

It’s an incredibly timely moment to be talking about the electric-vehicle industry, agree the experts, which is both in a period of dynamic development and central to tackling the problem of climate change — the long-term shifts in temperatures and weather patterns, mainly caused by human activities, especially the burning of fossil fuels from sources like gasoline used in traditional combustion engines.

The challenge? Moving a massive transportation system deeply dependent on gasoline to a system reliant on more climate-friendly energy sources, while ensuring safety and equity.

The good news is that the shift is happening. This is being prompted in part by urgency about climate change and governments pushing for faster movement toward reduced emissions. Electric vehicles have captured 7% of new car sales in the U.S.

“This is a really important moment in technology, policy and the marketplace,” says Genevieve Cullen, president of the Electric Drive Transportation Association, a U.S. business trade group that represents the entire value chain of electric transportation, including vehicle makers, electric-utility companies, companies in the materials supply chain (think lithium mining to make car batteries), and companies helping to build the EV infrastructure. “The future of transportation is electrification,” notes Cullen, who joined other EV experts recently during Penn Climate Week at the University of Pennsylvania for a panel on Cars and Climate: The Electric Vehicle Transformation.

Panelists agreed that the motivation to go electric comes from a variety of sources. “Transportation is the largest source of greenhouse-gas emissions (causing climate change), and you need to be electrified to address that,” adds Cullen. “This is where the global market is going, so if the United States wants to be a leader in the technology that’s going to drive the next century, we have to invest in electrification. This is also part of energy security. We have to have a different way of powering our transportation sector. Electrification is also essential to environmental equity. The communities that suffer the most from air pollution are often at-risk communities. By electrifying personal and commercial and public transportation, that’s how you get at better health outcomes in at-risk communities. There are a lot of reasons to do this.”

Dr. John Paul MacDuffie.

More signposts are guiding Americans toward widespread EV adoption, says John Paul MacDuffie, a Wharton School management professor who is a leading researcher of the auto industry and director of the Program on Vehicle and Mobility Innovation. Electric generation is becoming green faster than any other sector (think solar and wind energy), so anything that can be transitioned to electricity will advance emission-reduction goals faster — namely, cars.

Adoption, Affordability, Innovation

According to MacDuffie, the market is tackling one of the biggest barriers to broader EV adoption — the high price of electric vehicles coming from only a few producers. “While most of the press has gone to Tesla and other startups, it’s now pretty clear that the incumbent automakers — the household names from internal-combustion engines — are going to have electric-vehicle models on the market,” says MacDuffie. “So, it’s not a situation where the incumbents in the old technology fail to make the transition and it’s taken over by newcomers. Everybody now agrees that GM, Ford, Volkswagen, Hyundai, eventually Toyota are going to have successful EVs.”

And those prices? They’re coming down, suggests MacDuffie. “Right now, there’s still a bit of an affordability problem, but that’s where companies like GM — in alliance with Honda — is pledging to bring out lower-cost vehicles,” he notes. “I don’t think we’re ever going to see very low-cost vehicles from Tesla. But the big automakers are used to making a lot of products in different segments for different types of customers. They’re going to be able to do that.”

Affordability and better EV performance rely heavily on improved battery technology. This, says MacDuffie, is an area of explosive technological innovation.

Most plug-in hybrids (running on both electric and gasoline) and all-electric vehicles operate on lithium-ion batteries. Improved battery-cell chemistry is addressing some of the problems with sourcing raw minerals and metals. “You can read articles about how cobalt comes from the Congo with child labor and human rights abuses and how that is going to haunt the transition to electric vehicles,” says MacDuffie. “More and more, there is battery chemistry that doesn’t use any cobalt. All these batteries need lithium. Lithium, it turns out, is very plentiful in the earth, but the mining of it is lagging the demand. We’ll see a ton of investment in lithium, and there are some different models of how to extract lithium that are quite promising.”

MacDuffie adds that carmakers are starting to design the chassis – the frame on which a car is built – to include the necessary battery cells. Additional areas of the EV market that are ripe for innovative thinking: more convenient battery-charging stations and faster, more efficient EV manufacturing.

MacDuffie sees teenagers playing a valuable role in the future of EV – as innovators, as well as consumers. “I would say go try them out. The nice thing is that there are going to be a ton of models from lots of different automakers at lots of different price points,” he notes. “Even if you’re not sure you live in a situation where you can immediately use one (many young people are moving to cities to start their careers), it’s a great time to get out there and do test drives, find out what’s going on, and catch some of the excitement. Young people could be early adopters for this technology without really giving up anything. You can be more open to it and motivated by helping with the goal of reducing emissions and dealing with climate change. Why not get in on the ground floor of this exciting transition?”

Conversation Starters

Why is it an incredibly timely moment to be talking about the electric-vehicle industry?

What are three ways that the electric-vehicle market and related technologies are evolving?

Dr. MacDuffie says teens should consider test-driving electric vehicles. Have you done this or do you plan to? Would you buy an electric vehicle? Share your story and your insights in the comment section of this article.

5 comments on “Inside the Electric Vehicle Market

  1. Hats off to the amazing work done by Professor MacDuffie and the Global Youth Program! Electrification, while a novel idea, will change the transportation industry forever. What interests me the most is the fact that this revolution can go beyond cars on the road, in conjunction with other innovative technologies. Small forklifts in factories can run on electric power in the future, and be programmed to work without a driver. Farmers can use autonomous technology in conjunction with electric technology to make the production of crops more efficient than ever and emission-free. A recent Deutsche Welle article I read discussed a startup called Eviation and the potential for sky travel to run on electricity in the future. A world of opportunity behind the conventional definition of ‘EV’ is still waiting to be opened.

    Transportation makes up roughly 29% of all CO2 emissions worldwide according to the US EPA. Air quality standards across the globe, especially in developing nations such as India and China, are not being met.

    However, I believe the 29 percent of emissions created by transportation won’t just disappear with electrification. 25% of emissions are tied to electric power according to the same EPA study. If all transport is electrified tomorrow, then emissions will shift to power plants. Even after a transition to solar and wind energy, industrial fossil fuels may still be needed to mine rare earth metals for PV cells and wind turbines.

    The point is that we can’t get rid of emissions, but we can bring 29 down to a more manageable number. As a sophomore last year, taking AP Environmental Science was an eye-opener to the problems we have in our environment and the innovative solutions we have come up with to fix them. Clean energy sources will help reduce emissions overall, even if extraction of rare-earth metals creates some emissions. In Tesla’s impact report released about a month ago, in a ‘sustainable economy,’ mining needs are reduced by over 20%.

    Speaking of Tesla, my father drives a Model X, and our home also just got Tesla Solar/Powerwall installed. While I am still yet to take up driving, the prospect of driving an electric vehicle is enticing to me and the rest of the teenage market. Recently, I did a stock pitch for Tesla, where I learned a lot more about the growing industry. The EV, solar, and wind industries are growing at 23%, 15%, and 10% respectively. As these industries grow, the more solutions we will find for clean energy technology. The fact that electric vehicles already make up 7% of vehicle sales in a world where the 100-year auto industry has only used hydrocarbons shows the potential of the transition to save our planet.

    As MacDuffie says, the transition will be difficult as a 100-year-old industry makes its biggest pivot ever. Younger consumers are more eager than ever to push this transition forward. Despite the multitude of challenges in electrifying the transportation industry, teens like me will drive the transition – pun intended 🙂

    • Hello Archith S.,

      I’m a private educator and – as it so happens – am coaching some students for the Wharton Commenting contest. I like this topic and I want to comment on what you’ve written.

      Please take my comments less as criticism and more as collaboration.

      I checked out the EPA website and it seems that the transportation metric applies to the U.S. rather than the entire planet. It seems to have been revised in the month since your comment, down to 28%. Elsewhere, I see estimates scaling closer to 20% globally for transportation. But this is aside from the point you’ve raised: we want to get those numbers down.

      Or rather – of course – we want to reduce the things which those numbers reflect.

      And we don;lt want to be dismissive of the complications involved. The CO2 production inherent in the current production methods of batteries &etc. consists in much more than merely the mining of lithium. Every step in the sourcing, transport, and manufacturing chain of not just lithium, but also of steel, or aluminum, or electronics, emits its share.

      And China, if perhaps the worse for wear in terms of air pollution, is still among the lowest emitters of CO2 per capita.

      Only Bhutan – so far as I know – is actually carbon negative among the more than 200 sovereign nations of the world. At least we have one example. Good ol’ Bhutan uses hydroelectrics and produces sufficient excess to sell to neighboring countries, thus reducing those neighboring carbon footprints, thus carbon negative overall.

      It seems the current state of the art requires about 2 years of operation of a solar panel before it has offset the amount of CO2 required to fabricate the panel in the first place. Panels typically operate for 25-30 years. It seems like a feasible option to me.

      Solar panels, so it would seem, actually contribute more to reducing CO2 than an equivalent acreage of trees. How cool is that?

      For the time being, oceanic phyto-plankton are the leaders in CO2 reduction, far surpassing all the forests, (and solar panels), or the world. Surprisingly significant carbon-capture per/acre can also be achieved with relative ease by simply innoculating farmland with appropriate fungal mycelia. The fungi break down nutrients, the resulting crops grow much larger. All that carbon turned into plant material. If that were systematically implemented as the norm, just imagine the annual conversion of CO2 into plant. Rough calculations based upon sustained regional trials are impressive whether one rounds up or down.

      Somtimes simpler solutions are more effective than state of the art.

      And speaking of the current state of the art, you say that automated forklifts will run on electricity in the future? Guess what? Such things are already broadly in use.

      A Google search will easily reveal entire companies already producing automated electric-powered forklifts.

      Amazon – of course – uses a lot of such and similar automated electric-powered robotics in its warehousing and distribution systems.

      It would seem the future is already here my friend.

      Your third paragraph strikes me as a little unclear. If all transportation is electrified, then wouldn’t that actually make that particular source of CO2 emission disappear?

      No, I believe what you’re saying is that power plants would then haver to produce more electricity to subsequently provide power to recharging stations for all such vehicles. Do I understand you correctly?

      Well, I feel I’ve written just about enough for now. It’s nice to see that you’ve been taking these things into consideration Archith.

      As you continue to ‘drive the transition’ into the future, I hope you and others, (teens and older folks too of course), will bear in mind what you said about the shift of energy production to the power companies.

      Economics teaches us that a small slice of a big pie can still be much larger than the entirety of a small pie. Statistics alone are easily misleading if without context.

  2. The electrification of vehicles was invented many years ago, but one of the main problems hindering its progress was the lack of charging stations. However, in the present day, electric vehicles have gained significant popularity. Technological advancements have played a crucial role, providing us with the necessary resources to create better versions of EVs. Not only are they an amazing way to positively impact the world, especially in light of climate change, but they are also becoming more affordable to the public.
    While EVs may still be considered expensive by some people, the market for electric vehicles has expanded, with more companies entering the industry and increasing production. This trend is leading to lower prices for electric vehicles, making them a more accessible option. Moreover, maintaining an electric car is generally cheaper than maintaining a gas-powered car.
    From my perspective, I’ve witnessed the transition from gas-power vehicles to electric cars in my small city, although we currently have limited charging stations and a relatively small number of electric cars, their presence is becoming more common. I am eager to try out an electric car and embrace the positive changes they bring.

    • I am so glad that you are also interested in electric vehicles. I agree with your opinion that driving electric cars has some good aspects. Electric vehicles have several advantages, such as reduced maintenance costs and reduced environmental impact. They have environmental benefits; Electric vehicles have zero tailpipe emissions, reduce air pollution and greenhouse gas emissions. Furthermore, the cars help combat climate change and improve air quality and people can save money. Electric vehicles have lower fuel and maintenance costs compared to traditional internal combustion engine vehicles.
      Charging an electric vehicle is usually cheaper than refueling a gasoline or diesel vehicle, and since electric vehicles have fewer moving parts, they require less maintenance and improved performance.
      They offer quick acceleration and a smooth driving experience. The electric motor vehicles They also offer better handling and stability due to the lower center of gravity due to the placement of the heavy battery pack. As more charging stations are installed and electric vehicles become more popular, the transition to this technology is becoming easier. Electric vehicles are growing in popularity and accessibility as charging infrastructure continues to grow. Thus, if someone want to try out an electric car, we I recommend finding a near charging station near you and finding a local rental car or ride-sharing company that offers electric cars. In this way, you many people can experience the benefits of electric vehicles firsthand and contribute to a more sustainable future.

  3. In the past decade, technological advancements, particularly in electric automation, have been remarkable. The electric vehicle (EV) market, in particular, has experienced significant development, driven by its potential to offer environmental friendliness and reduced noise levels. The question arises: Do electric vehicles have the potential to eventually replace their gasoline counterparts as the primary mode of transportation?
    Recently, my father, an entrepreneur running a clothing manufacturing company in China, visited Vietnam with plans for business expansion. He observed an intriguing disparity compared to his home country: the absence of EVs in Vietnam. This stark contrast caught his attention, as he was accustomed to seeing EVs in abundance in the areas he frequented. Instead, the streets of Vietnam were filled with motorbikes and cars emitting harmful exhaust gases. Given that EVs produce no detrimental emissions, their widespread adoption in Vietnam seems like an ideal solution. However, the reality is different. Why hasn’t the transition to EVs occurred yet?
    According to Dr. MacDuffie, successful EV markets must address three crucial factors: adoption, affordability, and innovation. Among these, adoption not only holds the utmost significance but also relies on the resolution of the other two elements for a smooth transition. Adoption refers to the process of accepting and incorporating new technology into society. For EVs to realize their potential, they must prove their viability and appeal to the masses.
    Affordability has long been a hurdle for EVs, despite their declining costs over the years. These vehicles have gained popularity primarily in countries like the US, China, and Norway, all of which are considered energy-rich nations. It is no coincidence that developed countries, with greater financial resources, tend to embrace new technologies more readily. Conversely, underdeveloped or developing countries face challenges in acquiring these advanced vehicles due to limited funds. In my father’s example, Vietnam, as a developing country, lacks the financial means to access such advanced machinery.
    Electric vehicles are often regarded as an innovative solution for the betterment of humanity. Paradoxically, this unfamiliar concept of innovation has become one of the biggest obstacles for the EV market. Research indicates that over 58% of American drivers express fear towards EVs due to a condition known as “range anxiety.” This apprehension stems from concerns about running out of battery power before reaching their destination. This highlights the lack of education surrounding EVs. Without proper knowledge and understanding, curiosity transforms into fear and indifference, ultimately leading to reduced demand and productivity.
    To achieve successful adoption, public understanding of the technology is crucial. Dr. MacDuffie emphasizes the role of younger generations in driving the growth of the EV market. Providing them with adequate education and awareness about electric vehicles becomes imperative, as they will be the future proponents of EVs. Overcoming these significant challenges is paramount for electric vehicles to fulfill their potential as the primary mode of transportation for humanity.

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