Don’t be Shocked: Electric Vehicles 101
Yes, electric cars. I know it's supposed to be a travel blog, but one of the nice things about owning my own business is that nobody can tell me what I have to write about. 😉 The truth is that the electrification of transportation is a pretty important topic, and one that is often hostage to larger ideological and economic tides that influence our perceptions of what is true and what best serves our interests, both personally and as constituents of our broader communities.
Despite some very reasonable concern and resistance, we are living through a remarkable tipping point that is going to affect all of us over the coming years. Our legacy American automobile industry has a net impact on 8 million jobs and has traditionally contributed well over 10% of our manufacturing GDP. The ongoing transition to electric vehicles is going to radically change the landscape of the global economy, and will certainly have a profound impact on our domestic economic culture.
Surely this is an exageration! I’m afraid not. Can you name the world’s best selling vehicle (of any kind) in 2023? That would be the Tesla Model Y. 2024 global Electric Vehicle (EV) revenue is projected to be a staggering $623 Billion, with an annual projected growth rate of 10% annually for the remainder of the decade. By 2035, it’s projected that ⅔ of new vehicles sold will be electric. The headlines you may have read implying that there is a slowdown in EV demand, often fail to mention that the slowdown is only relative to the hyperbolic curve of production and demand over the past several years. Another factor affecting these misleading headlines is the very real fact that our US legacy manufactures are not doing a great job of designing, manufacturing or selling EV’s.
If you think that Tesla is the driving force behind this seismic shift, you might be wrong. I would argue that it is actually China. Companies like Warren Buffet-backed BYD are the new market leaders. Tesla has fallen behind BYD in sales and even BYD faces tremendous pressure from other emergent Chinese manufacturers. 1 out of every 3 cars made in the world are now manufactured in China. And although a lot of those vehicles are manufactured for the Chinese market, China is now the world’s #1 exporter, exceeding output from both Japan and Germany. The EV revolution is closely tied to the challenges US policy makers will have to face very soon regarding China’s access to US markets.
I own an EV. It’s a Tesla Model 3. In addition to sharing my thoughts on some of the generic issues related to EV’s, I want to share my personal thoughts on EV ownership. I don’t have any particular bias that I am aware of. Perhaps I will subconsciously err on the side of rationalizing my own purchase decision. Suffice to say, I will try to be as objective as possible and to link my sources whenever I state something as fact. I think the best way to do this is in a “Comment and Answer” format. If you see a question/comment that doesn’t interest you, you can move on to the next one.
Topic Index:
Vehicle Cost
Cost of Ownership
Battery Replacement
Range
The Electrical Grid
Performance
Autonomous Driving
The Environment
Cold Weather
Hybrids
They charge way too much money for EV’s!
Yes. They do. But let me re-frame that. I prefer to say that they charge too much money for cars. Period. The average price of a new vehicle (car/SUV/pick-up truck) in the US in 2023 was almost $48,000. You can buy a new Telsa Model 3 for significantly less. The truth is that none of the current four Tesla Models (S,3,X,Y… (and yes, I think Elon did that on purpose)) were designed to be affordable. I believe these were R&D projects designed for early adopters. To some extent they still are, and if there is a bit of a bump in the road on the demand curve, it's because most early adopters have already entered the market. But here’s the thing: If price is the major impediment to adoption, that is about to change radically. In fact, it would have already changed if China were taken off the leash in the US market. They are selling reasonably well-built EV’s for about $11,000. And they’re selling really well built EV’s for about $25.000. Furthermore, Tesla is moving beyond its initial S3XY approach, and will begin producing its Model 2 as soon as next year (2 S3XY! Yeah!) at a cost of around $25,000.
How is this happening? Well, your current ICE (internal combustion engine) vehicle has as many as 2000 moving parts. EV’s? As few as 20. This is going to have dramatic effects throughout the industry, and (though complicated) will certainly allow new efficiencies in manufacturing. All of this is happening at a time when AI and robotics are driving unimaginable change in assembly technology. And then we add to this mix the fact that the cost of batteries has been on a consistent and continuing decline since 2013.
So back to the original concern: prices! Even if EV prices are already coming in less than ICE vehicles, EV’s are about to get a LOT less expensive a lot sooner than you think.
Even if they make EV’s cheaper, they still don’t really save you money.
This one can take you down a lot of rabbit holes. There are a lot of competing interests here, and with so many potential outlying factors, I’m not sure you can ever provide an accurate across-the-board answer. Recently, there have been a few studies implying that owning a Tesla Model 3 results in roughly the same 5 year cost of ownership as a Toyota Corolla ICE vehicle. Here are 3 things I can tell you from my own personal experience:
It costs more to insure an EV than it does to insure an ICE vehicle. I could write a separate blog post on this, but it just “is what it is” at this point. Consumer Reports has a pretty good write-up here if you want to learn more.
My tires are wearing faster than they did on my ICE vehicle. Again, I could write a separate blog post on this. But suffice to say, you will probably have to pay more for tires.
Want to charge in your garage? You should. You can do so with a simple standard 12 amp outlet. However, it’s pretty slow (3-4 miles per hour of charging). You’ll probably want a 48amp wall connector. If you live in an older house, installation can be expensive, requiring some reorganization of your electrical system. Think +/-$2500.
Of course on the plus side, you no longer need gas or frequent mechanical service! If that sounds good, trust me… it is. (All of this calculus will change radically in favor of EVs when lower-priced EV’s start hitting the US market.)
No way I’d buy an EV, ‘cause getting a new battery costs $20,000!
Well, it’s not quite that much. But it certainly ain’t cheap. The real question, however, is why you would be replacing your battery. My Tesla's battery is under full warranty protection for 8 years or 120,000 miles. They are designed to last 300,000- 500,000 miles. So while it might be expensive to replace it, it’s very unlikely that you would need to.
Electric cars don’t have enough range!
That’s a very subjective statement. If you are using your car for short or moderate commutes, then this is really not an issue. My Model 3 gets about 330 miles under ideal conditions. And yes, I will admit that conditions are never ideal. So let’s call it 300. How often do you really drive 300 miles without stopping? Superchargers are everywhere. I’ve driven between Florida and Ohio seamlessly. Sure, I have to stop occasionally to charge up for 20-30 minutes. Big deal. (Yes, it’s true that you can watch Netflix while you wait. 🤪) Furthermore, each generation of batteries is further expanding the range. Tesla’s Model S now gets you up to 405 miles. I’m guessing that 90% of Americans would be fine day-to-day with current EV range constraints.
If everyone gets electric cars, the electrical grid will collapse!
This is another one of those concerns that is not unreasonable, and until I did my own research, I certainly had my doubts. I think it’s true that if everyone transitioned to EV’s overnight, the grid would be in trouble. That being said, this inevitable and ongoing transition is occurring at a predictable pace, allowing the grid to scale efficiently to meet these new energy demands. Here is one of the better short takes I’ve read. Now, when I refer to “the grid”, I’m referring to North America. Geography, economic development, and other factors continue to challenge many nations, and even in the US, there will be uneven efforts to keep up with power demands.
I hear electric cars are really fast!
Well, I’m not sure if they are fast. But they are certainly quick. My little Model 3 goes from 0-60 in about 3.7 seconds. That’s comparable to a Ferrari Modena. Not bad. If you’ve ever driven an electric golf cart, you understand the basic concept. The power delivery is immediate. Power delivery aside, my Model 3 drives really well. It moves with a stable confidence that (to me) is somehow superior to most of the ICE vehicles I’ve driven. If you’ve never driven a Tesla (or any electric vehicle for that matter) you should. It’s easy to set up a test drive.
I don’t trust cars that drive themselves!
Well, lucky for you your Telsa won’t drive itself unless you pay Elon the $199 full self-driving monthly subscription fee. (That’s true.) The basic lane keeping and dynamic cruise control that comes included with every Tesla are similar to what you would get with most ICE vehicles in 2024. Nothing special. I think the main reason we associate self-driving with EV’s is because Telsa happens to be a market leader in self-driving technology, and they also make EV’s. Their self-driving tech could be implemented in an ICE vehicle just as easily as it is in an electric vehicle. In fact many observers speculate that Tesla’s self-driving tech will indeed be licensed to other brands (ICE and EV) in the future. I won’t get into the details of self-driving tech here, but I will say that like EVs themselves, self-driving is inevitable. And I further believe that once eventually implemented effectively, it will save lives. (Note: Did you know that Elon Musk wanted the upcoming Model 2 designed without a steering wheel?)
Driving an EV will save the planet!
Nope. Unfortunately, it probably won’t. But let me explain…. There is a lot of noise out there about EV’s being just as bad or worse for the environment as ICE vehicles. And this is where it gets tricky because there might be certain interests out there that want you to believe that electric vehicles are harmful relative to other vehicle types. Like most things, I would tell you to look at the scientific research on the matter. Most agree that EV’s are better for the environment and will become more so over time. Here’s an MIT study on this subject. So if we can agree that EV’s are relatively better for the environment than ICE vehicles, then why can’t we just all buy an EV and save the planet? Well, the sad truth is that privately owned vehicles represent a statistically minor source of carbon pollution. (If you really want to save the planet there may be better ways, including flying less. Yes, this is a travel advisor telling you that flying is not great for the environment. This topic deserves a future blog post. We don’t have to stop traveling, but we may need to travel smarter. 😉)
EV’s won’t work in cold weather!
We all saw the news out of Chicago recently that Tesla owners were having to abandon their vehicles and that batteries were failing. I don’t want to discredit those stories. Where there’s smoke, there’s usually fire. However, I was in Northeast Ohio during that same timeframe, and I had no problem. We didn’t get much over 20 degrees for an entire week. In those temps, I was probably only getting about 75% of my maximum range, but that means I could drive over 200 miles. So no problem for me. What I think was going on in Chicago (and other places) was that you had some EV owners that didn’t keep their cars garaged at night and they didn’t have home-charging capabilities. I would tell anyone that if you get an EV in 2024, you should have some kind of home-charging solution. And furthermore, if you live in colder climates and don’t own a garage, then EV’s may not be a great choice. One of the big benefits of the EV revolution is an exponential ongoing improvement in battery technologies. Issues with EV’s in very cold climates will probably be mitigated by new technologies over the coming years. But at this point, you have to be smart.
Why not just get a hybrid?
Sure. Why not? As I mentioned in my introduction, I believe that the transition to EV's is inevitable and accelerating. However, at this point in the cycle, a hybrid vehicle might make sense for you. The caveat is that within two years, when new EV’s are selling in the $25,000 range, I’m just not sure that the calculus for holding on to a hybrid will hold up. We shall see. (I’m wrong most of the time. 🙃)
If you made it to the end, thanks for sticking with me. I hope that you learned something, or maybe it helped you think of things in a new perspective. Got questions about my personal EV experience? Drop me a note. I’d be happy to answer any questions.
