Europe Will Lead Electric Vehicle Revolution Not USA Says Ex-LG Chem CEO


Tesla may be an American company, but it looks like the USA as a market will not be leading EVs into the mainstream. At least, that is, according to Prabhakar Patil, who was CEO of LG Chem Power, Inc from 2010 to 2015, as well as spending five years working on Ford’s hybrid technologies. The former battery company head has estimated that 50% of cars sold in Europe could be EVs by as soon as 2025, when globally the figure will probably be more like 20%.

Ironically, it appears that the pandemic has accelerated the switch to EVs in Europe, according to a McKinsey report last year, helped by the backlash against Dieselgate. China had led the way until 2019, thanks to very attractive incentives and a fast-growing economy. But a report by Pew Research published in June showed that Europe took over in 2020, with a 10% market share of its auto market being plugins, compared to 5.7% in China and just 1.8% in the USA. Of the more than 3 million EV registrations in 2020, around 1.4 million were in Europe.

Europe has rapidly become the most fertile market for EVs. China has a huge 1.4 billion-strong population, whereas the EU’s population is just under a third of that (and the US’s population is less than a quarter), but European salaries are much higher than China’s. The average wage in Europe is around 24,000 Euros ($28,000), and up to three times that in the wealthiest European nations. In China it is around $15,000.

The USA has a much higher average wage than either of these regions at around $52,000. But this is where politics and other factors come into the equation. Many European countries are setting strict deadlines for the phasing out of sales of new fossil fuel cars and hybrids, such as the UK, as well as enforcing stringent emission standards for key cities. This is providing yet another incentive for residents to go electric.

In the USA, in contrast, there is a struggle between the governing bodies of states that want similarly tough deadlines and incumbent economic interests. When Californian Governor Gavin Newsom announced there would be a ban on gasoline-powered cars by 2035, even the Environmental Protection Agency weighed in to say it could be illegal. That’s one of the most “liberal” states, too. You can’t imagine oil-powered Texas going quietly into the electrified future, despite Tesla moving its headquarters from California to Texas (presumably for cheaper labor and more limited regulation). The American love of gasoline power will be hard to shift.

Europe has other advantages too. EVs are at their best in densely populated areas where short distances are travelled and there are enough people to warrant expenditure on charging infrastructure. Europe as a whole has a population density of 34 people per km2 (87 per square mile). America is about the same, with 36 per km2 (94 per square mile). However, while the US has some extremely densely populated cities, these are widely spaced across the country. Americans love road trips, and unless you have a Tesla, the US charging network doesn’t make this an easy prospect just yet.

In comparison, the richest nations in Europe tend to have extremely high population densities. The UK sits at 277 people per km2, Belgium 376, Germany 233, France 118, and the Netherlands a whopping 457 people per km2. It’s not surprising, therefore, that these countries are ripe for EVs, although electric-loving Norway bucks that trend with just 15 people per km2. BMW claims that 70% of its European electric car sales are in Germany, the UK, France and the Netherlands. These countries have the electrical infrastructure and rich enough populations for EVs to be viable. Tesla owners can benefit from more than 6,000 Superchargers across Europe, and IONITY is aiming to provide a parallel service for other brands with about 2,400 charge points, albeit hideously expensive if you don’t have a car from one of its partner brands, which comprise BMW, Mercedes, Ford, Hyundai, and Volkswagen Group (including Audi and Porsche).

As Prabhakar Patil argues, ubiquitous fast charging is the key enabler for EV take-up. Currently, EV range is considered one of their main deficiencies, but with adequate reliable charging placed in sensible and strategic locations, the need for a long range will fade away for most people. Cars like the hugely popular Mini Electric, which only offers 145 miles of WLTP range, would then be adequate for most journeys.

The arrival of more cars offering 800V charging such as the IONIQ 5 alongside infrastructure to support them will also provide an experience similar in duration to filling up a fossil fuel-powered vehicle. Batteries do need to support faster charging and be less susceptible to wear and tear if this is used regularly. Prabhakar Patil is now involved with Addionics, a seven-year-old startup working on battery chemistry to improve density with its 3D electrode technology. But it also provides lower internal resistance so that charging is faster, as well as more charge-discharge cycles for greater longevity.

There has been much discussion of how the magic $100 per kWh price boundary for batteries will enable battery-electric vehicles to become cheaper than internal combustion engine ones. Bloomberg NEF predicted 2027 as the likely year for the changeover. But with fast charging everywhere, we can get away from the idea that we even need a car with hundreds of miles of range. Why pay for a massive battery when, as with the average UK driver, you only do 20 miles a day anyway? Europe, with such fast growth in EV sales, now has a market large enough to make ubiquitous charging networks a lucrative business to be in. The cascade towards EVs is happening, with Europe at its epicenter.

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