EV adoption stalls amid cost concerns and policy uncertainty under Trump

The news: Only 5% of US buyers want a battery electric vehicle (BEV) as their next car, per a Deloitte survey of more than 31,000 consumers in 30 countries. 

The higher cost of EVs remains a sticking point, with 45% of respondents saying they won’t pay more than $34,999 for a car.

EV adoption is off target: The federal government’s goal to make half of all new vehicles sold in the US zero emissions by 2030 could face serious setbacks.

• While there are now a wide range of EVs, the lack of affordable options under $30,000 is limiting adoption in the US, per Bank of America (BofA), which noted that “EV demand growth has slowed sharply in 2024, likely due in part to affordability.”
• Seventy-five percent of US car buyers prefer used cars, a trend unlikely to shift with electrification, per Ars Technica.
• EV penetration has averaged 6.8% so far this year, down from 7.5% in 2023.
• BofA analysts say they now expect EVs to make up about 8% of vehicle sales in 2024, 14% in 2027 and 29% in 2030.

The Trump 2.0 effect: The threat of President-elect Donald Trump’s tariffs and his transition team’s plan to end $7,500 EV tax credits and incentives could drive up new vehicle costs considerably and place potential EV transitions out of reach for many. Trump also pledged to expand US oil production, already at record highs, and reverse Biden’s clean-energy policies, including subsidies for wind, solar, and hydrogen, per Reuters.

But Tesla, which sold just under half of all US EVs in the third quarter, per Cox Automotive, stands to gain hugely from Biden policies that Trump will likely leave in place or strengthen—including steep trade barriers and blocking Chinese EV imports.

Key takeaway: EV cost remains the top barrier to adoption cited by 50% of global consumers, according to Capgemini. Other hurdles, include battery lifespan, performance reliability, and inadequate charging infrastructure will all need to be resolved to earn back consumer trust.

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