Detroit – The headlines continue to trumpet the “electric cars of the future,” but the whisper in the auto community today is that the electric car revolution is sooooo 15 minutes ago.
Numbers from auto research firm Edmunds.com find that, despite a record number of battery-powered models for sale, the hybrid-electric market is low on charge. Fifteen years after the launch of the iconic Toyota Prius, the electrified market has settled in as a niche occupied by well-to-do greens (helped by “populist” Democrats tax credits of up to $7,500 per purchase) instead of the promised gateway to a post-oil future.
“This was a market that was supposed to grow, relatively rapidly, as people embraced these new technologies and more brands began selling these models,” Edmunds senior analyst Jessica Caldwell told the Los Angeles Times. “That hasn’t happened.”
Indeed, hybrid sales (vehicles powered by battery-assisted gas engines) are declining as trendy greens have simply switched their purchases from hybrids to battery-only electrics. While the EV market gained 22,939 in sales (to 81,097) in August, the hybrid market declined by 23,112 (to 327,418).
As a result, the battery-powered vehicle market as a whole declined to 3.66 percent of cars sold — down from 3.84 a year ago.
Automakers have made huge bets on electrics as the answer to the Obama EPA’s radical (and unilateral) 54.5 mpg auto mandate by 2025. But with EVs on IV, manufacturers like Toyota and GM are reviving the idea of hydrogen vehicles — not because they will sell, but because they will help automakers gain big mpg “credits” against the law.
Toyota, for example, quietly abandoned its joint venture with media-darling Tesla earlier this year to make a battery-powered RAV4 crossover. Instead, Toyota is banking on hydrogen credits and its hybrid lineup to meet its 2025 obligations. Tesla remains the EV hope with its taxpayer-supported Nevada battery gigafactory and the promised 2017, $30k Model E.
Contrary to Democratic rhetoric, in other words, more Washington regs are benefiting the connected rich: Bigger loopholes carved by three-piece suit lobbyists and bigger tax credits for rich consumers and manufacturers.
Revolution? The new auto market sounds like the same old Beltway insider play.