Member-only story
The Multifaceted Economics of Electric Vehicles
Are Electric Vehicles Too Expensive to Make or Too Expensive Not to Make?
As OEMs grapple with the economic realities of transitioning to electric vehicles (EVs) while facing the existential threat of climate change. The question arises: are EVs too expensive to make, or are they too expensive not to make given the looming ecological catastrophe?
The automotive industry stands at an historic crossroads as it confronts the monumental challenge of transitioning from internal combustion engines (ICEs) to electric vehicles (EVs). This shift is driven not just by evolving technology but also by ecological imperatives and regulatory pressures to reduce transport-related carbon emissions.
However, the road to an electric future is filled with financial roadblocks and uncertainties. Established automakers steeped in the ICE tradition are sounding alarms about the steep costs of reconfiguring legacy factories and supply chains to manufacture EVs. At the same time, new entrants like Tesla and startups like Rivian are pioneering fresh EV design and production approaches.
For consumers too, EVs carry a premium price tag amid anxieties about range constraints and charging infrastructure. The overarching question arises: Are EVs simply too expensive to…
