Politics can become a lot of white noise or, as our elders would say, “hot air” from bucks in office. Regardless of which side of the aisle you stand on in Congress, money and investment impact nearly every industry more than politics. Big companies don’t invest heavily in something that won’t work. Here are five ways cash is driving the electric vehicle market.
1. EV factories in the US grew by record numbers last year
Pick a name, any name, and you’ll find that the automaker has big plans to expand and develop its EV lineup. NPR reported that automakers announced more than $73 billion in planned projects last year, more than three times the previous record. He guesses? That previous record was set in 2021. The continued rise since 2018 shows that automakers have pushed all of their proverbial chips into the middle of the EV table.
2. Electric car batteries are growing at the same rate
Imagine if engine manufacturers stopped making car engines despite automakers announcing growth plans. The lack of engines would somehow paralyze the market. The same goes for electric vehicles. EV battery growth follows a similar path to vehicle growth, which is ideal for ensuring a smooth transition from internal combustion engines to battery-powered vehicles.
3. Electric Vehicles – Your tax money at work
Anything as big as the move toward electric cars requires incredible investment by automakers and billions of dollars in tax dollars. Don’t expect altruism to work in the auto industry. For every Ford F-150 Lightning sold, the consumer receives a $7,500 tax credit, but Ford also receives a $6,000 credit.
In addition to these credits, many automakers receive supplementary spending subsidies to build electric vehicle battery plants. Michigan awarded Ford nearly $630 million in incentives for a new EV battery plant that is expected to create 2,500 jobs. Panasonic expects to receive $830 million from Kansas for its EV battery plant in De Soto, which is expected to create nearly 4,000 new jobs.
4. The average income of electric vehicle owners is falling
While electric vehicle prices have risen dramatically in 2022, they are starting to come down. Typically, higher income consumers are drivers who own more EVs than those in lower income brackets. With the addition of the Inflation Reduction Act used EV incentives and EV prices going down, this average income is on the decline.
5. It costs less to own an electric car
Many automakers now offer incentives such as free charging, a home-installed charger, and specific discounts for electric vehicles. While the Tesla Model 3 still costs more than the Toyota Corolla, it is cheaper than the BMW 3 Series. The Chevy Bolt EV is the most affordable electric car on the market, and it gives the Corolla a run for its money.
Those concerned about fuel costs are much better off driving an electric vehicle. Recharging your EV at home is much more economical than stopping at a gas station, even as fuel prices have returned to a pre-Ukrainian/Russian norm.
Who will benefit most from electric vehicles?
Money shows that electric vehicles are here to stay. While some might think city dwellers will find the most benefit in driving EVs, Central America may benefit the most. About 12% of the country lives in apartments, mostly in coastal cities. Rural and average Americans live in single-family homes where recharging an EV at night is far more convenient than stopping at the gas station.
Money talks and it’s telling us that EVs are here to stay. Will your next ride be one of the new electric vehicles hitting the market?