According to a recent analysis by Reuters, global automakers are planning to spend more than $ 500 billion on electric vehicles and batteries over the next 5-10 years, increasing investments to attract buyers to meet increasingly stringent decarbonisation goals.
Less than three years ago, a similar analysis found that companies anticipated spending around $ 300 billion on EVs and related technologies. But looming emission abatement mandates in cities like London and Paris and in countries from Norway to China have added urgency to the industry’s investment commitments.
But industry executives and analysts remain concerned that consumer demand for EVs may be well below Case’s targets without substantial additional incentives and even greater investments in charging infrastructure and network capacity. Brian Maxim, head of global powertrain forecasting at AutoForecast Solutions compared the growing investment commitments in electrification to the Cold War: “Once the first manufacturers announced the Ev programs, everyone else had to adjust to not lag behind. .
However, this still worries many manufacturers who should plan significant volumes for a vehicle category that still has minimal consumer acceptance and will produce little or no profits for years. ” Other surveys have provided various projections. AlixPartners said in June that industry investments in EVs will reach $ 330 billion by 2025. According to the global consulting firm, in 2020 all the houses combined spent nearly $ 225 billion on capital expenditures for research and development. Tesla, however, still appears to be the only one that is selling virtually every vehicle it can build and is preparing new gigafactories that will significantly increase its annual production capacity. In early November, the company was valued at $ 1.2 trillion, more than double the combined value of the Volkswagen group, Toyota, Ford Motor and General Motors combined. The VW Group continues to lead the industry with over 110 billion in EV and battery investment commitments through 2030. These commitments, which account for more than 20% of the industry total, are the basis of aggressive launch plans for millions of vehicles. in Europe, China and North America over the next decade. VW’s investments, like those of many of its rivals, are aimed at improving battery range and performance and lowering the cost of vehicles, as well as expanding battery and car production around the world. VW and the other German manufacturers Daimler and BMW are planning to spend a total of 185 billion until 2030, while the US companies GM and Ford are planning investments of almost 60 billion until 2025. The Chinese, led by VW and GM’s local partner Saic Motor, have announced investment targets of over 100 billion over the next decade, while the Japanese are still lagging behind, with Honda, Toyota and Nissan so far publicly pledging less than 40 billion combined. However, these investments do not include the tens of billions invested in additional production capacity by the world‘s largest battery companies, many in collaboration with their respective automotive partners.