As the car industry recovers from the lingering effects of the pandemic, the supply chain crisis and various other geopolitical obstacles, manufacturers are being forced to confront another commercial headwind that threatens to throw their production plans and investment strategies into disarray: a global drop in demand for electric cars.
Variously attributed to continued consumer uncertainty about the usability of electric cars, their high price relative to ICE alternatives and the notion that the first wave of early EV adopters have long since adopted, the global EV ‘slowdown’ – as it has been widely dubbed – has prompted many mainstream car firms to row back on electrification plans and called into question the electrification timelines that have been outlined by governments worldwide.
FORD
Blue Oval boss Jim Farley said recently that the availability of cheap credit pre-Covid, the pent-up demand for cars amid the semiconductor chip crisis and the rapid rise in early adopters of EVs had given the firm “too optimistic ademand signal” for electric cars.
Confronted with a surplus of supply for its F-150 Lighting pick-up and Mustang Mach-E SUV, and a target market that is “not prepared to pay a premium to go electric”, Ford is now shifting focus – and investment – to the development of smaller and more affordable electric cars.
“We learned very quickly and I want to say that no one will be immune to this reality,” said Farley of the plateau in demand for Ford’s EVs.