By Nick Pope
Daily Caller News Foundation
- The Department of Energy (DOE) unveiled new talking points to reassure Americans of the strength of the electric vehicle (EV) market, which appears to be in a tenuous condition.
- The DOE’s talking points attempt to counter claims that EV sales are declining, charging infrastructure is insufficient, consumer demand is dwindling and that EVs are too expensive, but energy industry experts and automobile manufacturers are telling a different story.
- “DOE can cite all the surveys about consumer interest it wants, but the billions of dollars in losses and investment cancellations tell us all we really need to know about what is happening in the EV marketplace today,” David Blackmon, a 40-year veteran of the oil and gas industry who now consults and writes extensively on the energy sector, told the Daily Caller News Foundation.
The Biden administration is rolling out new talking points to reassure Americans of the promise of the electric vehicle (EV) market, but energy industry experts aren’t buying them.
The Department of Energy (DOE) published rebuttals on Thursday in order to “[correct] the record on electric vehicle sales” and reject “myths” about the industry, amid a flurry of headlines suggesting that the industry is on shaky footing. The DOE aimed to take down “myths” about EV sales numbers, charging infrastructure, consumer interest and pricing, but the agency’s talking points do not directly address the main problems that critics have specifically identified with the industry, experts told the Daily Caller News Foundation.
The Biden administration is aiming to have 50% of all new vehicle sales be EVs by 2030, aggressively regulating markets and spending billions to facilitate that goal. However, a slew of problems, ranging from labor unrest to interest rates and inherent deficiencies of EVs, have combined to hinder the industry at a time when the Biden administration is counting on it to ramp up its EV production and sales.
“The truth is, familiarity with EVs seems to breed contempt, with most people having them as second, third or fourth vehicles so they will have something reliable,” Dan Kish, a senior research fellow for the Institute for Energy Research, told the DCNF. “Since most of the buyers are wealthy, they’re the people who can afford EVs, unlike regular Americans who can no longer afford to buy a car, period, under Bidenomics.”
“Myth” 1: EV sales are experiencing a decline in absolute numbers
The DOE implies that critics of the administration’s EV push are falsely claiming that EV sales are declining outright. While EV sales are not dropping, they are not growing at the pace envisioned by the manufacturers when they set longer-term production targets, according to Reuters.
“It is true that EV sales are not declining in absolute numbers. However, the pace of EV adoption is dramatically slower than the Biden administration’s rosy outlook had projected,” David Blackmon, a 40-year veteran of the oil and gas industry who now consults and writes extensively on the energy sector, told the DCNF. “Indeed, the pace of decline is so severe that U.S. automakers have now announced billions of dollars worth of cancelled or delayed investments and new model lines.”
Manufacturers, including Ford and General Motors, have explicitly cited cooling demand as a key reason motivating decisions to delay investments and EV-production targets. Dealers are saying that outright EV sales are slowing down significantly, and it took nearly twice as long on average to get an EV off the lot in August 2023 as it did the previous January, according to CNBC. To try to clear some of the supply glut, dealers have increasingly used leases to entice consumers.
“Myth” 2: There’s a lack of charging infrastructure
The DOE the addresses the supposed “myth” that the country currently lacks a comprehensive charging network by pointing out that most American EV drivers charge up overnight or while parked at the workplace, and that the Biden administration has poured $7.5 billion into building out hundreds of thousands more charging stations across the country to supplement the 160,000 already in existence. However, the DOE does not address the fact that most existing charger networks are located in more densely populated coastal regions, and that range anxiety remains a persistent factor dogging consumer perceptions of EVs, especially in more rural regions of the country.
Evidently, there was concern about the availability of charging recently at the highest levels of the agency: In July, Energy Secretary Jennifer Granholm’s EV road trip through the Southeast hit an unexpected snag when the police were called on one of her staffers, who had raced ahead of the convoy in a gas-powered car to reserve a spot at a charging station in Georgia to keep the trip on schedule. The staffer’s move to park a gas-powered car to hold a spot prompted a local family waiting to charge with a crying infant in tow to call the police on the staffer.
“DOE is just flailing at this point, in the wake of all the bad publicity Secretary Granholm received this summer when she went on her EV escapade that would have made a good ‘Gilligan’s Island’ episode,” Kish told the DCNF.
The lack of charging infrastructure in rural locations is also a real problem, according to David Gelles of The New York Times, who rented an EV to travel across western Minnesota and visit a farm for a separate story he was working on over the summer. He ultimately had to get his EV towed back to the rental agency in Minneapolis because the overnight recharge at the farm did not give him sufficient range, an experience which prompted him to declare that the nation’s charging infrastructure is “not ready for primetime.”
Additionally, the Biden administration may have subsidized chargers that are effectively already obsolete, and many EV users complain that some charging stations are in such disrepair that they are effectively useless. While the DOE asserts that private sector innovations are driving down charging time, many EV drivers, including Ford CEO Jim Farley, have found that unpredictable charging speeds and availability can cause problems for even the most enthusiastic proponents of the vehicles.
“Myth” 3: Consumer interest is waning
The DOE asserts that consumer interest has grown steadily, thanks in large part to concern for the environment, government subsidies and improvements to battery capacities and charging availability. To back up their claim, they cite data from JD Power that shows 63% of surveyed respondents expressed interest in buying an EV in June 2023, up from 57% in 2021.
However, the average price of an EV has dropped by about $15,000 between October 2022 and October 2023, a price reduction which is occurring at the same time that manufacturers are losing considerable sums on each EV that they sell. The reductions could signal that manufacturers are trying to move their inventories, even if at a steeper loss, and several major companies have backed off short-term production targets and previously announced investments.
EV inventory has almost doubled from 3% of available new car inventory in January to about 6% as of September, while EV sales have gone from 3% of vehicle market share in January to 4% in September, according to Cloud Theory, a company that specializes in auto industry analysis.
“DOE can cite all the surveys about consumer interest it wants, but the billions of dollars in losses and investment cancellations tell us all we really need to know about what is happening in the EV marketplace today,” Blackmon told the DCNF.
“Myth” 4: EVs are not affordable enough to compete with traditional combustion vehicles
For its last point, the DOE tries to demonstrate that the price cuts and its view that fueling costs are lower for EVs prove concerns about affordability are overblown.
The DOE asserts that charging is less expensive than filling up at the gas station in the long-run, but a recently published study by the Texas Public Policy Foundation found that the true cost of charging a model year 2021 EV is equivalent to paying $17.33 per gallon of gasoline, including subsidies and excess charging costs.
Additionally, the DOE does not address significant price differentials of key American EV models in its rebuttal: for example, the Chevrolet Silverado, America’s most popular vehicle, starts at about $36,800, while the EV model is expected to start at about $50,000 next year. Similarly, the Ford F-150, another favorite model of Americans, runs buyers about $36,500, while the electric version starts at just under $50,000.
“DOE boasts that prices for new EVs are down by 20% since the first of the year. This is also technically true,” Blackmon told the DCNF. “What DOE fails to note, however, is that the reason for this is that automakers are now so desperate to move their products that they are pricing many models below cost. This is not sustainable.”
Neither the DOE nor the White House responded immediately to requests for comment.
This story originally was published by the Daily Caller News Foundation.
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