The booming of the EV market will come sooner than expected. The latest announcements from the US, EU, and China are heralded by the coming of the EV era. The EU just proposed to ban the sale of petrol and diesel vehicles in the EU from 2035. The US president Joe Biden also announced to accelerate US sales of electric cars and trucks to 50% of all new vehicle purchases by 2030. EV is now impacting the automotive industry.
At the "Asia Venturing (II): Tech-Driven Mobility" event, co-organized by DIGITIMES and Anchor Taiwan, on August 10, 2021, Vitaly M Golomb, the tech venture specialist and the event host, chatted with MIH Alliance CEO Jack Cheng and Monika Mikac, CBO of Barcelona-based QEV Technologies and former COO of Croatian EV startup Rimac Automobili to further analyze the driving forces of the EV growth and the latest industry status.
The market now is making a dramatic change. Golomb said, "One possible positive effect of the pandemic-related manufacturing shutdowns has been a big jump in EV market share because as all the supply chains are coming back, they're certainly not going to be building for the past."
Eric Huang, VP of DIGITIMES, citing data from EV-volums.com, said that Europe superseded China as the global driver of electric car sales in 2020 for the first time in five years, as total EV sales jumped 43%, regardless of the COVID-19 crisis. He further said, "We all know that the government policy is the biggest driving force for the EV market growth. Based on DIGITIMES Research forecasts by the year 2025. EV will take over a 20% market share of the global automotive market and the compound growth rate from 2020 to 2025 will achieve 40%."
Countries competing to develop EV
Now there are two factors that have driven especially the EV adoption, more than anything else to this point. One is the government regulations, and the other is government incentives, noted Golomb.
Mikac then mentioned the government incentives can give a push for the growth of electric vehicles. She said, "Considering Croatia where I'm coming from. It's a small country, and car sales dropped heavily in 2020. Nobody was selling cars because nobody was moving anywhere. And nobody thought about buying cars. And now in 2021 beginning, the government gave US$40 million subsidies for electric cars. In two days, people applied and used the subsidies to buy cars. So in basically two days, you had higher car sales and electric car sales, than what you had in 2020."
Cheng said, "Well, five years ago, when we just started from China, there was just a start with the incentive. And also the regulation is now moving towards supporting the EV but is on a gradual basis. But now, we can see Joe Biden's announcement of incentivizing all the EV industry to go forward with the US$174 billion bill. That's something huge because now the big conglomerates are competing from China, the US, and now in Europe. Everybody is trying to do something differently."
"What the regulation does is just for sparkling all these. And later on, the consumer was gonna do something about, you know, with all these incentives, they will be moving to user experience, user interface and also gaining the experience and creating the pie bigger. And once that pie is bigger, you know, when I was in the automotive industry, we always say the 'product, product, product' is something that drives the whole requirement. So I believe that there's a lot of things that we can do to make sure that the increase of the EV, and then spread into the whole bunch of smart mobility world."
Mikac echoed, "If you look at Norway in 2020, EV sales of light vehicles was 54%. While in the US, that number was only 2%. So there is a huge difference for the US to catch up with all the efforts that Norway was doing. In Norway, at the moment, you could say that EVs are already mainstream. They want all the cars that are sold by 2025 to be either electric or hydrogen."
The tipping point will arrive soon
Driven by government incentives, EV sales continue to grow. The industry is expecting when the tipping point for EV will arrive. Cheng said, "Once you have the EV experience, you're not going back to the combustion engine. That's a different world, because not only from the environmental point of view but also from a user experience point of view…. It will become smart TV, smart mobility, then it's a different world. So I think that the experience that can get all the customers is a one-way street, they never come back to the combustion. So that's something that I think if you ask me whether there's a tipping point that I wouldn't say, exact year, but at least three or four years later, when the combustion engines, the fuel consumption, and also the operating cost is more than the EV, then there will be a tipping point."
(Editor's note: Asia Venturing is a series of monthly roundtables with roadmaps to the future focusing on the hype v.s. the reality of Asia's supply chain-boosted innovation ecosystem, jointly powered by DIGITIMES and Anchor Taiwan. We bring together leading industry luminaries, corporate strategists, experienced investors, and entrepreneurs to expand your network and redefine the possibilities of cross-border opportunities. The replay of the session can be seen on DIGITIMES or Anchor Taiwan.
(Clockwise from left) Ethan Su, VP of DIGITIMES; Elisa Chiu, founder and CEO of Anchor Taiwan; Eric Huang, VP of DIGITIMES; Monika Mikac, CBO of QEV Technologies; Vitaly M Golomb, tech venture specialist and the event host; Jack Cheng, CEO of MIH Alliance