When it comes to sustainable transport, there is no doubt that electric vehicles (EVs) lead the way. EVs have between 60% and 70% lower lifetime emissions. What’s more, they produce zero tailpipe emissions, eliminating the pollutants NOx and PM2.5, which are linked to asthma, heart disease, and premature death. Despite their potential to reduce the impact of global warming, their manufacture is at a standstill. The current global market is leading individual companies to change their plans, with some major players deciding to focus on hybrid instead of fully electric vehicles.
Uncertain Pricing of EV Cars
Current tensions between the US and China are halting the progress of the electric vehicle industry, especially when it comes to big players like Tesla. China controls around 90% of the global rare earth market, which contains the elements required to build EV motors and batteries. Amid tariff disputes and friction between key nations, Beijing is threatening to refuse supply, and American drivers are becoming hesitant to replace their fuel-based cars with electric ones. Tesla is already experiencing a downward slide, with its shares reportedly being slashed in half compared to their value a few months back. It’s not just the stock market reflecting the downturn; consumers, too, are concerned about the long-term appeal of homegrown EVs. Some of their concerns include high purchase costs, limited charging infrastructure, and worries about battery degradation and replacement costs.
Hybrid Cars Step In
Manufacturers and consumers are keen on marrying the best features of EVs and gas cars via hybrid technology. Honda Motor Co. announced it is cutting back on its planned investments in electric vehicles (EVs) due to slowing global demand. Instead, the company will focus on meeting the increasing consumer interest in hybrid cars by rolling out new models, Reuters reports. Specifically, Honda has reduced its planned investment in electrification and software by 30% to 7 trillion yen ($48.4 billion). Honda executives told the press that Honda plans to launch 13 next-generation hybrid models worldwide, starting in 2027. The company also plans to develop a hybrid system for larger vehicles. Honda hopes to sell between 2.3 and 2.3 million hybrid vehicles by 230. This is a gargantuan leap from its 3.8 million vehicles sold in 2024. Honda has clarified, however, that it still hopes to have battery-powered and fuel-cell vehicles make up all of its sales by 2040.
Other Companies Refocus Their EV Strategy
Nissan, currently in the midst of a restructuring plan, recently announced that it would be closing seven of its seventeen production facilities worldwide to improve the cost efficiency of its EV and internal combustion engine (ICE) businesses. The company recently scrapped three EV projects and delayed the production schedule of two electric crossovers for the North American market. Factors leading to this decision include a slower-than-expected transition to electric vehicles, increased costs, and greater competition from markets like China. Reuters reports that Nissan is also prioritizing hybrid technology, as their market research indicates a higher demand for hybrids. Nissan isn’t alone. Late last year, the Ford Motor Company announced plans to shift production in Canada from electric sports vehicles to gas-powered pickup trucks. The announcement was made shortly after General Motors shared that it would trim down its forecast of EVS produced last year by 50,000. Despite the significant interest in EVs after the pandemic, fewer vehicles were sold than expected. For instance, The Times reports that only 269,000 EVs were sold in the first quarter of 2024. This represents a 7.3% decrease from the last quarter of 2023.
Can Hybrids Mitigate Global Warming
Hybrids do not reduce CO2 emissions as dramatically as EVs do, but they still fare better in this regard than traditional gasoline vehicles. Studies have shown that they burn less fuel overall, have less tailpipe emissions, and produce less greenhouse gas. Because they reduce emissions of pollutants like nitrogen oxides and particulate matter, they help contribute to cleaner air.
Car manufacturers worldwide are scaling back on plans to manufacture EV vehicles. In part, the problem is caused by the current trade war. However, consumers have also expressed an interest in hybrid vehicles, which help reduce greenhouse gas emissions, albeit not as effectively as EVs.
