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Mainstream EV Adoption: 5 Speedbumps to Overcome

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Mainstream EV Adoption Infographic

Mainstream EV Adoption: 5 Speedbumps to Overcome

Many would agree that a global shift to electric vehicles (EV) is an important step in achieving a carbon-free future. However, for various reasons, EVs have so far struggled to break into the mainstream, accounting for just 2.5% of global auto sales in 2019.

To understand why, this infographic from Castrol identifies the five critical challenges that EVs will need to overcome. All findings are based on a 2020 survey of 10,000 consumers, fleet managers, and industry specialists across eight significant EV markets.

The Five Challenges to EV Adoption

Cars have relied on the internal combustion engine (ICE) since the early 1900s, and as a result, the ownership experience of an EV can be much more nuanced. This results in the five critical challenges we examine below.

Challenge #1: Price

The top challenge is price, with 63% of consumers believing that EVs are beyond their current budget. Though many cheaper EV models are being introduced, ICE vehicles still have the upper hand in terms of initial affordability. Note the emphasis on “initial”, because over the long term, EVs may actually be cheaper to maintain.

Taking into account all of the running and maintenance costs of [an EV], we have already reached relative cost parity in terms of ownership.

—President, EV consultancy, U.S.

For starters, an EV drivetrain has significantly fewer moving parts than an ICE equivalent, which could result in lower repair costs. Government subsidies and the cost of electricity are other aspects to consider.

So what is the tipping price that would convince most consumers to buy an EV? According to Castrol, it differs around the world.

CountryEV Adoption Tipping Price ($)
🇯🇵 Japan$42,864
🇨🇳 China $41,910
🇩🇪 Germany$38,023
🇳🇴 Norway$36,737
🇺🇸 U.S.$35,765
🇫🇷 France$31,820
🇮🇳 India$30,572
🇬🇧 UK$29,883
Global Average$35,947

Many budget-conscious buyers also rely on the used market, in which EVs have little presence. The rapid speed of innovation is another concern, with 57% of survey respondents citing possible depreciation as a factor that prevented them from buying an EV.

Challenge #2: Charge Time

Most ICE vehicles can be refueled in a matter of minutes, but there is much more uncertainty when it comes to charging an EV.

Using a standard home charger, it takes 10-20 hours to charge a typical EV to 80%. Even with an upgraded fast charger (3-22kW power), this could still take up to 4 hours. The good news? Next-gen charging systems capable of fully charging an EV in 20 minutes are slowly becoming available around the world.

Similar to the EV adoption tipping price, Castrol has also identified a charge time tipping point—the charge time required for mainstream EV adoption.

CountryCharge Time Tipping Point (minutes)
🇮🇳 India35
🇨🇳 China34
🇺🇸 U.S.30
🇬🇧 UK30
🇳🇴 Norway29
🇩🇪 Germany29
🇯🇵 Japan29
🇫🇷 France27
Global Average31

If the industry can achieve an average 31 minute charge time, EVs could reach $224 billion in annual revenues across these eight markets alone.

Challenge #3: Range

Over 70% of consumers rank the total range of an EV as being important to them. However, today’s affordable EV models (below the average tipping price of $35,947) all have ranges that fall under 200 miles.

Traditional gas-powered vehicles, on the other hand, typically have a range between 310-620 miles. While Tesla offers several models boasting a 300+ mile range, their purchase prices are well above the average tipping price.

For the majority of consumers to consider an EV, the following range requirements will need to be met by vehicle manufacturers.

CountryRange Tipping Point (miles)
🇺🇸 U.S.321
🇳🇴 Norway315
🇨🇳 China300
🇩🇪 Germany293
🇫🇷 France289
🇯🇵 Japan283
🇬🇧 UK283
🇮🇳 India249
Global Average291

Fleet managers, those who oversee vehicles for services such as deliveries, reported a higher average EV tipping range of 341 miles.

Challenge #4: Charging Infrastructure

Charging infrastructure is the fourth most critical challenge, with 64% of consumers saying they would consider an EV if charging was convenient.

Similar to charge times, there is much uncertainty surrounding infrastructure. For example, 65% of consumers living in urban areas have a charging point within 5 miles of their home, compared to just 26% for those in rural areas.

Significant investment in public charging infrastructure will be necessary to avoid bottlenecks as more people adopt EVs. China is a leader in this regard, with billions spent on EV infrastructure projects. The result is a network of over one million charging stations, providing 82% of Chinese consumers with convenient access.

Challenge #5: Vehicle Choice

The least important challenge is increasing the variety of EV models available. This issue is unlikely to persist for long, as industry experts believe 488 unique models will exist by 2025.

Despite variety being less influential than charge times or range, designing models that appeal to various consumer niches will likely help to accelerate EV adoption. Market research will be required, however, because attitudes towards EVs vary by country.

CountryConsumers Who Believe EVs Are More Fashionable Than ICE Vehicles (%)
🇮🇳 India70%
🇨🇳 China68%
🇫🇷 France46%
🇩🇪 Germany40%
🇬🇧 UK40%
🇯🇵 Japan39%
🇺🇸 U.S.33%
🇳🇴 Norway 31%
Global Average48%

A majority of Chinese and Indian consumers view EVs more favorably than traditional ICE vehicles. This could be the result of a lower familiarity with cars in general—in 2000, for example, China had just four million cars spread across its population of over one billion.

EVs are the least alluring in the U.S. and Norway, which coincidentally have the highest GDP per capita among the eight countries surveyed. These consumers may be accustomed to a higher standard of quality as a result of their greater relative wealth.

So When Do EVs Become Mainstream?

As prices fall and capabilities improve, Castrol predicts a majority of consumers will consider buying an EV by 2024. Global mainstream adoption could take slightly longer, arriving in 2030.

Caution should be exhibited, as these estimates rely on the five critical challenges being solved in the short-term future. This hinges on a number of factors, including technological change, infrastructure investment, and a shift in consumer attitudes.

New challenges could also arise further down the road. EVs require a significant amount of minerals such as copper and lithium, and a global increase in production could put strain on the planet’s limited supply.

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Energy

Visualized: The Growth of Clean Energy Stocks

Visual Capitalist partnered with EnergyX to analyze five major clean energy stocks and explore the factors driving this growth.

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The teaser image shows the growth of clean energy stocks and hints at their cumulative five-year returns.

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The following content is sponsored by EnergyX

The Growth of Clean Energy Stocks

Over the last few years, energy investment trends have shifted from fossil fuels to renewable and sustainable energy sources. Long-term energy investors now see significant returns from clean energy stocks, especially compared to those invested in fossil fuels alone.

For this graphic, Visual Capitalist has collaborated with EnergyX to examine the rise of clean energy stocks and gain a deeper understanding of the factors driving this growth.

Sustainable Energy Stock Performance

In 2023, the IEA reported that 62% of all energy investment went toward sustainable sources. As the world embraces sustainable energy and technologies like EVs, it’s no surprise that clean energy companies provide solid returns for their investors over long periods. 

Taking the top-five clean energy stocks by market cap (as of April 2024) and charting their five-year cumulative returns, it is clear that investments in clean energy are growing:

CompanyPrice: 01/04/2019Price: 12/29/20245-Year-Return %
First Solar, Inc.$46.32$172.28272%
Enphase Energy, Inc.$5.08$132.142,501%
Consolidated Edison, Inc.$76.55$90.9719%
NextEra Energy, Inc.$43.13$60.7441%
Brookfield Renewable Partners$14.78$26.2878%
promotional graphic with a button and wheel that promotes the EnergyX investment site

But how does this compare to the performance of fossil fuel stocks? 

When comparing the performance of the S&P Global Oil Index and the S&P Clean Energy Index between 2019 and 2023, we see that the former returned 15%, whereas the latter returned an impressive 41%. This trend demonstrates the potential for clean energy stocks to yield significant returns on an industry level, sparking optimism and excitement for potential investors. 

A Shift In Returns

With global investment trends moving away from traditional, non-sustainable sources, the companies that could shape the energy transition provide investors with alternative opportunities and avenues for growth. 

One such company is EnergyX. The lithium technology company has patented a groundbreaking technology that can improve lithium extraction rates by an incredible 300%, and its stock price has grown tenfold since its first offering in 2021.

promotional graphic that promotes the EnergyX investment site

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