Friday 15 January 2021

Impact of Covid-19 on the EV market

Impact of Covid-19 on the EV market

I was convinced that this year would be dominated by C for carbon and the journey towards net zero. However, C for Covid-19 has most definitely stolen the limelight – prompting a huge amount of change. The coronavirus pandemic has hit the business world with unprecedented scale and speed. It has caused the closures of businesses, the stoppage of factory outputs, and disruption to global manufacturing industries and their supply networks.

The EV market has unsurprisingly not escaped the disruption and remains vulnerable due to its relative youth and dependence on global supply chains for its core technology: batteries.

China’s role as a global battery manufacturing powerhouse meant that the slowdown in production at the early stages of the global pandemic had a strong ripple effect, impacting EV supply chains across the globe.

But there’s light at the end of the tunnel. Over 90% of Chinese businesses have resumed production and China’s manufacturing heartland, Guangdong, is almost back to normal as over 6 million workers return to work.

Whilst Europe and the States are further behind in their fight against the virus, car manufacturers are busy putting measures in place to ensure that when they get the green light, they can move quickly to meet the strong consumer demand for EVs that exists.

Because despite what the pessimists say, demand remains high. This year in the UK, overall car sales have dropped by a third. Meanwhile, sales of pure electric cars have more than trebled.

And no, you don’t have to wait a year for the delivery of your new EV.

New analysis by What Car? published this month (prior to Covid-19) shows that for all 26 EV models on sale in the UK, waiting times have fallen dramatically. The majority are now available within 12 weeks – this used to extend as far as 12 months. Popular models such as the Renault Zoe, the Tesla Model 3 and the VW e-Golf can be delivered in a week – and the Nissan Leaf within a fortnight.

As the EV market recovers from the coronavirus crisis, many of the most popular electric vehicles can be delivered as quickly as a petrol or diesel vehicle, which is a real boost for prospective buyers. As a result, I firmly believe the growing demand for EVs will not be knocked off course by this crisis.

A silver lining of global lockdown has been the positive impact on the environment. Locals in Punjab are tweeting photos of the Himalayas from more than 120 miles away; now visible for the first time in 30 years following a drop in air pollution. Meanwhile, the water in the canals of Venice is clear enough to see fish swimming below as coronavirus halts tourism in Italy.

A range of data shows that by staying indoors and off the roads, pollution levels have almost halved in the UK – and similar patterns can be seen across Europe, the United States and China. The Copernicus Atmosphere Monitoring Service has been tracking pollution levels using satellite data and ground-based measurement systems, and has attributed falling pollution to a reduction in vehicle.usage. The effect we’re seeing on NO2 pollution levels represents the same impact as most motorists switching to drive electric cars.

This is in an incredibly exciting and compelling proposition – and the changes we’re seeing in our environment are clearly capturing the attention of customers.

A recent study shows that 45% of people have reconsidered their electric vehicle ownership plans as a result of the radical improvement on air pollution seen across the globe thanks to the demobilisation of transport. A further 17% said it reaffirmed the decision they had already made to make the switch to an EV.

Coronavirus has arrived just as the climate movement was breaking through. 2019 saw both the UK and France agreeing to net zero emission targets, with Greta becoming a household name and central bankers beginning to talk about ‘climate stress tests’ and ‘green quantitative easing’. But in a world confronted by pandemic, climate change has taken a back seat.

Society and healthcare systems around the world are battling the crisis and confronting the fear and uncertainty that is affecting billions of people. It’s been fantastic to see different industries come together to tackle the pandemic, including automotive companies who have stepped up to support with the manufacturing of ventilators. Everybody wants to help where they can.

As we ask ourselves what happens next, as we move towards the recovery phase, I don’t believe consumers want to return to the old world of fossil fueled vehicles and dangerously polluted cities. We will have to keep the parallel crisis close and trust the proposition of falling oil prices doesn’t undermine the wants and needs for a cleaner, greener future.

Stimulus measures adopted in a post-pandemic world will demonstrate the full impact of the virus on the environment. A dash for growth is inevitable – and something that many will welcome following a time of real hardship. The key will be how we can rebuild sustainably, maintaining the momentum we gained in 2019.

If there’s one luxury this new world has afforded us it’s more time to think and reflect, which if used correctly, will allow the EV market to burst out of the traps as global lockdown subsides. But at the very least I hope that we maintain and build on our environmental standards, having been inspired by the positive changes we’ve witnessed to our environment over the last few weeks.

Written by

Bruna Pinhoni

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