Sep 28, 2020 (IAM Newswire via COMTEX) -- Bill Gates said that innovation is moving at an unprecedented pace and this is especially true when it comes to EVs. Electric vehicles have arrived much faster than many experts anticipated as little as half a decade ago. Although the shift from ICEs to electric vehicles was slow to materialize at first, it is now accelerating on a global scale due to more stringent government emissions regulations, falling costs, an increasing awareness about climate change.
Traditional automakers are waking up as there is a massive amount of resources going into the race to beat Tesla /zigman2/quotes/203558040/composite TSLA -0.99% . Although every story is bound to have winners and losers, there will be number of big carmakers who will succeed to catch up. Moreover, technological advancement is helping the market to expand at an exponential rate with many new startups entering the field with their models due to come out within the next 12 to 24 months.
Last week, Musk announced that a $25,000 Tesla will be available in 3 years. The pricetag of an electric Volkswagen /zigman2/quotes/204431732/composite VWAGY +1.60% ID.3 equates to a Golf. A Tesla Model 3 costs as much as Bayerische Motoren Werke Aktiengesellschaft /zigman2/quotes/200850296/composite BMWYY +0.24% BMW 3 Series. Moreover, the electric Renault Zoe /zigman2/quotes/206101250/composite RNSDF +2.93% can be leased inGermany can be leased for as little as $164 a month. A few years ago, industry experts expected 2025 would be the turning point. But technology is advancing faster than expected and poising the industry for a quantum leap.
Although the launches of some new production EVs were delayed due to the pandemic, more two dozen electric vehicles will debut by the end of next year. These include the Ford /zigman2/quotes/208911460/composite F -0.51% Mustang E and its electric F-150, Rivian R1T and R1S, as well as the Tesla Cybertruck, Model Y and Roadster. As for pickups, two upcomers come with serious tech advanced promises, namely Hercules Alpha and Atlis XT which will integreate Worksport's /zigman2/quotes/200413469/composite WKSP -0.13% solar system TerraVis, allowing tonneau covers to provide both power generation and storage. Meanwhile General Motors /zigman2/quotes/205226835/composite GM +1.44% has committed to 20 new EVs by 2023 including models from Chevrolet, Cadillac, GMC and Buick. Moreover, last week GM announced it has full faith in its recently inked deal with Nikola /zigman2/quotes/208704275/composite NKLA -8.22% despite the scandal caused by allegations of fraud that forced its CEO Trevor Milton to resign. Then again, GM won much more than its upcoming Badger as it now has an entry ticket to the EV race.
The Europeans are also not behind with the Audi e-Tron, BMW i4 and iX3, Polestar 2, Volvo XC40 Recharge, Porsche Automobile /zigman2/quotes/208541451/composite POAHF +2.70% Taycan and Macan EV and Mini Cooper SE. Within the next six months, the Japanese are entering the race big time by selling the Honda /zigman2/quotes/207173990/composite HMC -1.91% e, Nissan /zigman2/quotes/207656007/composite NSANY +0.28% Ariya SUV, Toyota Motor /zigman2/quotes/200537742/composite TM -0.89% Mirai fuel-call car and Mazda's /zigman2/quotes/206326885/composite MZDAY +0.89% MX-30, the firm's first-ever electric SUV. The traditional carmakers' best hope lies in exploiting their expertise in supply chains and mass production, which are not at all negligible strengths that upcomers do not have. Afterall, VW didn't name its first electric model "Intelligent Design" for nothing as their legacy and know-how that persevered through time is a source of competitive edge.
Although Musk disappointed investors last week with intangible promises on Tesla's Battery Day, he did explain how Tesla plans to deliver a $25,000 EV in three years from now. The holy grail of the industry is the battery whose costs must be reduced to a fraction of what they are now. Although no actual progress has been shown, a clear path has been laid out. The carmaker that succeeds in bringing the cost, and consequently price, of EVs comparable to that of traditional vehicles will be well-positioned to dominate the industry. The only question is who will get there first.
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