Automakers Commit to an EV Future
GM, Ford, and Stellantis Have Big Plans for EVs
General Motors (GM), Ford (F), and Stellantis (STLA) announced plans for half of all the cars and trucks they sell in the US to be electric by 2030. The broad commitment on the part of the three big Detroit automakers hinges on federal funding for research and development, buying incentives, and the creation of a national EV charging network. These were all built into the White House’s $1 trillion infrastructure bill, which is currently making its way through Congress.
When announcing their EV commitments, the car companies pointed to the need for the infrastructure bill to be passed quickly. The automakers’ decisions come as the White House announced tighter fuel-efficiency standards. By focusing on EVs, the vehicle makers will be able to meet those standards.
Public Charging Stations Are Part of the Push
The infrastructure spending bill earmarks about $7.5 billion for states and cities to construct public vehicle-charging stations. As it stands there are about 110,000 of these stations across the country. President Biden previously set a goal for there to be 500,000 public charging stations by 2030. The bill also includes over $6 billion for battery production and recycling, but the bill lacks tax credits to incentivize consumers to buy EVs—something the car industry is still pushing for.
While vehicle makers are enthusiastic about the shift to EVs, the transition will not be without hiccups. Wall Street analysts expect margins for the three car companies to take a hit as they transition to new manufacturing techniques and spend billions of dollars along the way.
EV Sales Small But Growing
EVs still make up a small portion of overall vehicle purchases, accounting for 3% of the US market in both May and June. But that number is growing as more consumers feel comfortable with EVs.
Traditional car manufactures are responding by pouring a collective $330 billion into the EV market over the next five years. Much of that money is going to overhaul plants so that they will be able to produce EV batteries. GM, Ford, and Stellantis recently committed to an ambitious EV goal and other traditional carmakers are hot on their heels. It will be interesting to see what is down the road for the EV industry.
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