One of the key discussion points in our recent Propulsion Strategies for the 21st Century Conference focused on whether, because the current administration and Congress are reducing or eliminating fuel economy and emissions regulations, manufacturers will be content to build and sell only internal combustion engines (ICE) over the next few years. Eric Anderson from S&P Global Mobility, like most of our other speakers, does not think these government actions will stop EV development and production.  All the speakers see a reduction in EVs sales and more nuanced decisions about which segments will offer EV variants. In this clip, Eric describes his reasoning for a multi-energy (powertrain) near term market, rather than a pure ICE market.

Having said that, the 2024 automakers selling in the US sold 80 percent ICE vehicles, 11 percent hybrids, 3 percent plug-in hybrids, and 6 percent pure EVs. If one includes the 14 percent of hybrids that also have internal combustion engines, then the US market purchased 94 percent ICE vehicles.  Though our speakers expect an uptick in hybrid and plug-in hybrid sales (along with a reduction in EV sales), the US will continue to be a market of new vehicles made up overwhelmingly of ICE vehicles. The EU is similar with 86 percent ICE sales in 2024; whereas, China’s ICE sales were 53 percent and shrinking dramatically. 

Of course, one can argue that hybrids and plug-in hybrids are an emissions improvement on pure ICE vehicles, but it seems like only China is acting with any sense of urgency in reducing CO2 emissions in the vehicle sector (the power sector is another story).  They are leading because they decided about 15 years ago to seriously begin the transition to EVs by mining battery materials/minerals at home and abroad while also mastering processing these materials.  The EU and the US only started within the last few years to build their own EV battery supply chains.  With the US bowing out of the process, only the EU and China will continue mastering EV technology.

All the automakers that sell globally will have to design and build EVs in order to compete in China and the EU, but the big question will be if they will commit to mastering EV technology that is still in its early stage of development.  

Alan Taub, Director of the University of Michigan’s EV Center thinks, “We are at risk of losing our industry,” if we do not keep up with the latest battery technology. Alan spoke at our recent Propulsion Strategies for the 21st Century conference at the University of Michigan. As this short video shows, Alan doesn’t think that the US battery industry is hopelessly behind in battery development, but he also thinks that the US must not allow itself to be left behind. It’s interesting that most of the main battery developers in the US are Korean and Japanese with Tesla doing some development along with Korean and Japanese partners in the US and Chinese partners in China.  

There are a number of US startup battery companies that are developing batteries but not at scale. Because the current administration is not supporting the EV industry, it will be up to auto manufacturers, suppliers, and universities to continue battery development.

We’ll be following Alan’s EV Center as they take on research projects with manufacturers and suppliers now and at their new Battery Center that will be built at the UM Transportation Research Center.  

During last week’s 17th Annual Propulsion Strategies for the 21st Century conference at the University of Michigan, Brian Schneidewind from Toyota North America spoke about his company’s multi-energy propulsion systems, with the current focus on hybrids in the US yet at the same time building EVs in China. Both companies still sell primarily internal combustion engine vehicles in China and the US.

As Brian mentions in this clip, for the near future, major manufacturers must be able to master and continually improve all powertrain technologies in order to remain flexible globally. During our discussion with him, he discussed his role as Vice-President of Powertrain Design and R&D as supporting the organization to transition its engineers to use new technologies to shorten development time. He sees the Chinese competition as state-supported but also with very energetic engineers, continually testing new ideas that competitors must match.

During our recent Propulsion Strategies for the 21st Century hybrid conference at the University of Michigan, most of our presenters described a near-term US powertrain future that is multi-energy: internal combustion engines, hybrids (mild hybrids, plug-in hybrids, and full hybrids), and battery electric propulsion systems. This graph from Eric Anderson, MBA from S&P Global Mobility shows his group's propulsion forecast through 2032.  

Surprisingly, EVs continue to grow during this time as do hybrids, and internal combustion engines slowly decrease over time. It’s surprising for two reasons: 1) Nearly 80 percent of the vehicles US manufacturers currently sell have internal combustion engines, while another 10 percent of the vehicles are hybrids that also include internal combustion engines.  2) The current administration has cancelled the EV new and used vehicle incentives and changed the Corporate Average Fuel Economy program so that manufacturers will not owe any fines, even if they do not meet any of the goals set by the government.  So, manufacturers have no incentive to change what they are currently doing, at least in the US.

There may be some emissions regulations that affect the type of internal combustion engines sold, but these regulations are also being made less stringent by the current administration. Thus, we will have to see if manufacturers continue on their current path of selling high levels of internal combustion engine-based vehicles, or if they decide that the reprieves from fuel economy and emissions regulations are temporary, and that they need to continue to develop EVs for the future (though much more slowly than in the recent past). 

Alan Taub, Director of the University of Michigan Electric Vehicle Center, discussed the importance of EV charging at our 17th Annual Propulsion Strategies for the 21st Century hybrid conference last week at the UM. It’s striking how much the Level 3, DC fast chargers have increased in Michigan, as shown on this chart.

Since the federal funding for more chargers throughout the US has been cut, it will be important for the states, the auto companies, third party charging companies, and utilities throughout the US to pick up where the previous administration left off. There are a number of projects that have been initiated by all these actors, so we will be following how the charging rollout continues. One way of tracking the roll out is through the following government website: https://lnkd.in/gbTm-R9V

As of Sunday, July 20th, the combination of public and private charging sites the US includes:

79,346 Charging Stations

243,754 Charging Ports

Of those ports:

2,622 are Level 1 Chargers

181,827 are Level 2 Chargers

59,282 are Level 3 DC Fast Chargers

One thing the government doesn’t track is at home charging, which represents 80 percent of all charging currently.  The combination of at home and public charging is what makes EV ownership unique. The gap in research that needs to be addressed is determining exactly how many public chargers are needed to meet future demand as EVs become a larger part of the fleet but also after they have reached their maximum fleet penetration in the future.

At this week’s Propulsion Strategies for the 21st Century hybrid conference at the University of Michigan, Bruce Belzowski provided results from Automotive Futures Groups’ Future of EV Charging expert survey. The experts were asked how many of each type of charger will be needed at major freeway charging stations in 2030. Though technology may change by 2030, especially as battery manufacturers begin to develop batteries that can accept greater amounts of electricity, the need to mirror or exceed gasoline fillup times will be one of the benchmarks for the transition to EVs. Accordingly, the experts think that 11 DC fast chargers will be needed to meet this goal by 2030. Interestingly, they also think there will be 7 Level 2 chargers needed. It will probably be the case that DC fast chargers will be more expensive to use than Level 2 chargers, so providing options for drivers will be a reasonable option.

A major question is the location of all these chargers. Will current freeway gas stations transition to EV charging stations, or will completely new stations, like Tesla Superchargers, take over? Whichever model or mixed model occurs, utility experts say that electric companies will need significant lead time to support the amount of electricity needed for all the DC fast chargers that will be needed. This may be one of the bigger barriers to meeting freeway charging needs in the future.

Our recent Propulsion Strategies for the 21st Century Survey focused on EV charging. One of our questions asked our industry experts: How important is it for auto manufacturers to support EV charging infrastructure? As this graph shows, the overwhelming response is that OEMs have an extremely important role to play in the future of EV charging. Some OEMs have already formed consortiums to work together to develop charging infrastructure, and some individual companies have started their own charging networks, following Tesla’s strategy that allows EV owners to drive across the country, always finding accessible chargers. Some of the charging stations are being designed as luxury EV stops, while some companies are working with charging companies such as ChargePoint, EVgo, or Blink to develop their supporting charging networks.

We asked many more questions about the role and development of chargers in the US over the next 5 years, and we’ll be presenting these results at our upcoming 17th Annual Propulsion Strategies for the 21st Century hybrid conference on July 16th at the University of Michigan. 

From our first looks at EVs in 2010s, we knew they would have to meet or exceed customer expectations for charging. Our recent 2025 Propulsion Strategies for the 21st Century Survey on the Future of EV Charging focused on future EV sales, charging regulations/policies, station strategies, consumer options, and future considerations.  One question we asked our group of industry experts was how long should drivers have to wait to charge at a public charger.  As this graph shows, the experts think consumers will not wait longer than five minutes.

Charging stations are different from gas stations because more than 80 percent of EV owners charge at home.  Because EVs have ranges of over 200 miles per charge, most consumers will only need to charge often on longer trips or long commutes.  This should mean there is less need for public chargers.  But urban EV owners and long distance drivers will need access to public chargers, nearly as much as they need gas stations. While Level 2 home chargers offer relatively slow charging times, public charging infrastructure is increasingly focused on DC fast chargers, which can deliver up to an 80% charge in just 10–15 minutes. Also, auto manufacturers, public utilities, and third parties are slowly building out the charging infrastructure.  EVs and charging will be part of our discussion at our 17th Annual Propulsion Strategies for the 21st Century Hybrid Conference at the University of Michigan on July 16th.  Join us to discuss where the automotive propulsion industry is heading. 

We always expect a high number of EVs at any Chinese auto show.  But the 2025 Shanghai Auto Show also included just as many PHEVs.  What’s sometimes missed in the discussion of China’s continuing increase of New Energy Vehicles is that they include EVs, PHEVs, and fuel cell vehicles.  With a market share of 40-50 percent and growing, NEVs put EVs and PHEVs on equal footing, which they are not.  PHEVs, though they tend to get better fuel economy than gas vehicles, still have engines with exhaust emissions, and some recent research from the EU says that PHEV owners do not plug in their batteries regularly, thus relying on their engines that are not optimized to drive the vehicle without the support of the battery.  

These slides show that even Chinese manufacturers are hedging their bets by providing a PHEV option along with their EV option for the same vehicle.  BYD has done this for years, where sometimes half of their sales are PHEVs.  All this is a response to range and charger anxiety in China as well as in the US and the EU, though China has thousands, if not millions, more chargers available.  

We’re tracking EVs and charging in China, the US, and the EU at our EV Evolutions research program.  

Recent research from University of Michigan student Alexander Villagomez shows the differences and similarities of EV policies in the US and the EU.  As Alex states in his conclusion, “The EU and U.S. have reached comparable milestones in EV adoption, but they reflect fundamentally different approaches. The EU’s progress stems from regulatory consistency — its binding emissions standards and mandated infrastructure targets provide a stable policy environment that holds automakers accountable across member states. The U.S.’s success has been more volatile — driven by large-scale financial incentives like those in the IRA, but vulnerable to political shifts and federal-state conflicts over implementation. Their strategies toward China also differ. The U.S. has pursued supply chain decoupling aggressively, limiting access to tax credits for vehicles with Chinese components. The EU, while also concerned about supply chain independence, is taking a more gradual approach focused on building domestic capacity. In the end, the EU offers a more rule-based and enforceable path to EV adoption, while the U.S. highlights the potential and fragility of incentive-driven market acceleration.  These differences not only shape national EV trajectories but also reveal contrasting views on industrial sovereignty and global competition.”

All policies are subject to change.  The new US administration goals prove the point about the fragility of incentive-driven markets, while the EU recently granted a 3 year extension for EU manufacturers to meet their CO2 emissions goals.  Changes may also occur with each region’s dealings with China.  The US may eventually focus on reducing tariffs on Chinese vehicles imported into the US, or the Chinese, like the Japanese before them, will begin building vehicles in the US.  In the EU, the Chinese are already building EV and battery factories in the EU, and there are hints that there may be joint ventures with EU manufacturers in the offing.

These are the types of analyses we develop as part of our EV Evolutions research program, and we thank Alex for his work on US/EU EV policies over the past school year.  

Recent research from University of Michigan student Nitya Wanchoo shows the impact of Biden Administration support for the US EV supply chain through the Bi-Partisan Infrastructure Law and the Inflation Reduction Act.  Though many of the provisions of these laws are in danger of cancellation, the many EV and battery plants, and the redesign of many existing auto manufacturer and supplier plants are already near or at completion.  Nitya’s poster, as shown here, covers the details of the EV and battery manufacturing plants, shows the location and size of the investments across the US, and displays the many relationships of auto manufacturers and battery suppliers in the US. 

It’s an impressive set of information and analysis that we support at Automotive Futures through our research on the EV industry in the US, EU, and China.  Nitya spent two sememsters with us developing her understanding of the US EV supply chain, but also learning about the global auto industry.  We’re continuing to update our EV databases and measure the effects of the new administration on the EV industry in the US through our EV Evolutions research program.

As part of our EV Evolutions research program, we track company strategies related to EV technology, including charging.  GM Energy, a subsidiary of General Motors, recently is taking a more Tesla-like approach to highway and home EV charging.

(https://lnkd.in/gN3e6isy)

GM Energy, Pilot Company, and EVgo expanded their EV fast-charging network to over 130 Pilot and Flying J on popular interstate corridors, similar to Tesla’s original Supercharger network that showed that an EV can travel across America with an EV.  GM is also part of the IONNA initiative that combines the efforts of multiple manufacturers to build charging stations that support all vehicles.

GM Energy recently joined a pilot project with Pacific, Gas, and Electric to test the capability of bi-directional and home energy storage to help manage loads on the grid as well as acting as backup electricity in case of power outages, similar to Tesla’s Powerwalls.

https://lnkd.in/gwFkgQjH

GM sees these as supporting consumers’ decisions to purchase EVs by offering a total cost of ownership approach.  In the future, bi-directional charging should reduce electric utility bills by either using less energy at home and/or selling energy back to the grid.  As a subsidiary, GM Energy has some freedom to experiment, but it also can be sold off or disbanded like Cruise was last year.  Yet charging, especially long distance charging, is one of the major factors holding some buyers back from purchasing EV.  As more chargers become available, potential buyers will no longer see them as one of a number of roadblocks to purchasing EVs. 

Managing the need for local batteries to avoid tariffs, Honda inked an agreement with Toyota Motor Corporation to purchase batteries for their hybrid vehicles from Toyota’s new battery plant in North Carolina.  Both Honda and Toyota have pushed for hybrids over pure EVs, yet Toyota recently took over EV battery orders from a former GM/LGES plant in Lansing, Michigan as well as building their own battery plant in North Carolina.  It sure looks like they are positioning themselves for a near-future EV world.  This also includes their building of an EV plant near Shanghai to support their Chinese sales.  We’ll be keeping an eye on these continuing EV battery factory developments with the largest global automaker through our EV Evolutions research project. 

It’s interesting that we usually find that lab results don’t always translate to real world use, but a study published in Nature Energy by SLAC-Stanford Battery Center found that EV batteries can last up to 38% longer in real-world conditions than laboratory tests predict, challenging prior assumptions about battery longevity.

The research analyzed data from EVs in actual use and found that batteries degrade more slowly in real-world driving, likely due to more varied driving patterns and charging behaviors compared to controlled lab conditions.  Current lab tests, used by automakers and regulators to estimate battery lifespan, may not fully capture the effects of real-world conditions, leading to underestimations of battery durability.  This is a result that needs more verification across multiple battery chemistries and EV makers.  Understanding how EVs actually work in everyday use will be extremely important in marketing EVs going forward.

Toyota has spent the last couple of years trying to convince people that BEVs are not ready for consumers, despite the growth of Tesla and the Chinese BEV makers.  They are correct that it is difficult for auto companies to make BEVs profitably, with many of the Chinese BEV-only companies still not profitable.  And Tesla would not have survived in the US without the ability to sell fuel economy credits to the Big 3 automakers.  BYD is profitable because of the long term support of NEVs by the Chinese government and now their export capability.  But to say that the technology is not ready for consumers is just not true, and Toyota knows this.

To their credit they developed a RAV4-styled compact SUV BEV, though it does not provide enough range to compete with the Model Y.  But other BEVs are in the works.  In order to compete in China where it seems 40 percent of new car buyers think EV technology is ready, Toyota is building a Lexus electric vehicle and battery company in Shanghai, their first Chinese factory that does not require a Chinese joint venture partner.  Production is slated to begin in 2027.

In the US, Toyota took advantage of investment support from the Inflation Reduction Law to build a $14 billion electric vehicle battery plant in North Carolina that is expected to create about 5K jobs and will be Toyota’s 11th production plant in the US and the first fully owned battery plant outside of Japan.

Both of these industrial moves have interesting reasonings.  In China, Toyota is losing market share like the other traditional automakers, so they have a sense of urgency to meet consumer (and government) demand.  Coming out with a luxury BEV allows them to separate themselves from the low end of the BEV market.  The major question is where will the batteries come from:  China or Japan?

For the US, the US government investment support played a big role in their decision, but the plant is now ready to produce batteries for hybrids, PHEVs, and BEVs.  This allows them to continue to market hybrid technology while developing more competitive batteries.  Toyota plays the long game, but their late arrival to BEVs requires them to compete against BEV companies that have batteries that are a generation or more ahead of their technology.  We will see how fast they can catch up.  As Sherlock Holmes stated, “The game is afoot!”

This article from Electrek.co, https://lnkd.in/gFNhFVYx, reports that Stardust Power in Muskogee, OK officially broke ground on the only battery-grade lithium refinery in the US.  The Inflation Reduction Act supported this company because the US lacks refining capabilities for lithium, which is dominated by China.  State and federal economic incentives will total $257 million of the total $1.2 billion for the plant.  We are waiting to see if the new administration will delay or cancel their portion of the incentives based on their intentions to eliminate anything having to do with climate change.  We’ll be discussing this issue at our April 22nd conference on the effects of the new administration on the automotive industry.  We’re sure it will be an interesting discussion.

Ford Pro has been a success for Ford Motor Company in the US and the EU.  They’ve been in the forefront in developing fleet systems for both their gas and EV offerings.  Now Ford offers companies a software program called Ford Pro E-Switch Assist to help companies decide if their fleets can benefit from purchasing and running EVs.  This article in Auto Remarketing, https://lnkd.in/gANWuGRb, provides the details of the program, but it taps into offerings Ford Pro presented in one of our past conferences:  providing chargers for drivers who take their vehicles home and helping them with the best times to charge, while also managing reimbursement.  These programs are exactly what fleets need to make it easier to decide if and when to transition to EVs.

General Motors and Volkswagen are following Tesla in developing their own battery cells.  Tesla has been building their own battery cells for their vehicles for years (though they, like all the other major auto companies, except BYD, also purchase batteries from Asian battery suppliers).  Now General Motors and VW want to do the same.  General Motors recently announced it is planning to build a $145 million battery cell prototype factory at its Global Technical Center campus in Warren, Michigan.  This facility will help GM accelerate the development of electric vehicle battery cells, reduce costs, and address manufacturability issues before mass production. Battery cell production is expected to begin in 2027.  Volkswagen also is building plants in Germany and Spain to build their own batteries with plans to begin producing batteries in 2025.  What’s important to note is that these plants are also R&D labs for testing new battery technology.  Batteries are not in their final stage of development, and nearly all OEMs are partnering with battery development companies to work on the next generation of batteries, including solid state batteries.  What’s interesting is that the leading battery companies are based in Asia and are selling their batteries to these OEMs for their vehicles today.  Yet the OEMs feel they need to be in the game, understand it, and maybe become one of the leaders in battery technology, similar to their dominance in internal combustion engines.  What we will be tracking as part of our EV Evolutions project will be how the major battery suppliers react to the challenge of their customers competing with them on batteries.  OEMs already play the battery suppliers against each other in order to get the best technology at the best price, but a company needs to know where the technology is headed to make the best battery choice, which is where their own battery development comes in.

Public charging for electric vehicles (EVs) in the United States is showing measurable signs of progress in 2025, with failed charging attempts falling to their lowest level in four years, according to J.D. Power’s latest EVX Public Charging Study. Despite delays in National Electric Vehicle Infrastructure (NEVI) funding, the industry has moved forward with improvements in reliability, underscoring the role of automakers and charging providers in strengthening networks even without federal support. Overall satisfaction, however, continues to lag, with scores for DC fast charging and Level 2 charging declining to 654 and 607, respectively, as costs and payment processes drag down the experience.

The share of EV owners unable to charge during a visit has fallen to just 14%, down from 19% in 2024—a meaningful improvement that highlights better station uptime and service quality. Yet, satisfaction with charging costs has declined sharply, reflecting both rising electricity rates and the end of widespread free charging incentives. Non-Tesla drivers using Superchargers report particularly low value relative to cost, underscoring the challenges of extending a brand-driven ecosystem to a wider customer base. At the same time, OEM-branded networks from Mercedes-Benz, Rivian, and Ford are beginning to achieve Tesla-level satisfaction, even if their smaller footprints kept them from ranking formally this year.

Performance varies widely across regions and cities. The Pacific region leads in non-charge visits, with one in five EV owners reporting failed attempts, while the East South Central region reports the lowest rates. Seattle and Los Angeles stand out for high failed-charging rates, while San Francisco and Denver report more frequent wait times for available chargers. Out-of-service hardware remains the top cause of failed visits, affecting 60% of incidents. These patterns point to ongoing challenges in scaling infrastructure evenly across the country.

Notably, first-time EV owners are more satisfied with charging than veteran owners, suggesting that expectations rise with experience. While newcomers rate both Level 2 and DC fast charging more positively, longer-term drivers are increasingly critical of costs and technology gaps. The findings highlight that building more stations or faster chargers is not enough: customer trust depends on delivering reliable, cost-effective, and seamless charging experiences. Tesla continues to lead in both Level 2 (Tesla Destination) and DC fast charging (Tesla Supercharger), but competition is intensifying as automakers move to replicate its vertically integrated approach.

Mobile apps are becoming an essential part of the electric vehicle (EV) ownership experience in the United States, with engagement levels hitting new highs in 2025, according to J.D. Power’s latest U.S. OEM EV App Report. Nearly one-third of non-Tesla owners now use their app every time they drive—up from just 17% in 2024—while Tesla users show even greater reliance at 79%. Apps have become indispensable for functions like charging management, climate control, and route planning, but overall satisfaction continues to be constrained by slow response times, connectivity issues, and inconsistent feature performance. As expectations rise, the speed and reliability of remote commands are emerging as decisive factors for customer trust.

Speed remains the biggest differentiator: almost half of EV owners expect apps to respond to remote commands in under five seconds, while 40% of Tesla users expect responses in just one to two seconds. Tesla’s performance in this area has translated into higher satisfaction scores (7.9 out of 10 vs. 5.5 for non-Tesla users), giving it a competitive edge. Connectivity also shows improvement, with Tesla cutting its complaint rate nearly in half year-over-year, while over a third of non-Tesla owners still report lost connections or delayed updates. These gaps highlight the need for manufacturers to make consistent app updates and improve communication about app functionality.

At the same time, many EV owners remain under-engaged with advanced features. While more than 70% of users express strong interest in services like charge scheduling, trip planning, and in-app payment for public charging, large shares of non-Tesla owners have never used them. This gap between interest and use points to both awareness and availability issues. Feature desirability itself is evolving, with growing demand for driver profile customization, remote window controls, smartphone key access, and in-app security alerts, while core functions like vehicle status checks and over-the-air updates remain must-haves for nearly all owners.

In rankings, Tesla once again leads overall and among premium EV apps with a score of 864, followed by Mercedes-Benz (839) and My BMW (833). In the mass market category, MyHyundai with Bluelink ranks highest at 820, ahead of Kia Access (808) and MINI (797). The findings reinforce that EV apps are no longer optional extensions of the ownership experience but are now central to it. Automakers that can deliver fast, reliable, and feature-rich mobile experiences will strengthen customer satisfaction and loyalty as the EV market matures.

Electric vehicle (EV) purchase consideration in Canada remains stable in 2025 at 28%, according to J.D. Power’s latest Canada Electric Vehicle Consideration (EVC) Study. While essentially unchanged year over year, Canadian shoppers are still less than half as likely to consider an EV as U.S. shoppers, where consideration holds at 59%. Beneath the steady topline number, however, the market is shifting. The federal pause of the $5,000 Incentives for Zero Emissions Vehicles (iZEV) rebate program has influenced buyer attitudes, with 42% of likely EV shoppers saying the change reduced their intent to purchase. In Quebec—where provincial rebates were briefly paused earlier in the year—consideration dropped eight percentage points, while it rose modestly elsewhere in Canada.

Brand preferences are undergoing a dramatic reshuffle. Hyundai, Kia, Toyota, Ford, and Chevrolet are now the top five most-considered EV brands, reflecting a tilt toward established automakers with broader dealer and service networks. Tesla, which consistently ranked in the top two in prior years, has fallen to eighth place, down 16 percentage points year over year. By contrast, all other brands combined gained only half a percentage point, highlighting the scale of Tesla’s decline relative to peers.

Confidence in Canada’s long-term electrification targets remains weak. Three-quarters of new-vehicle shoppers say they are not confident the federal government will meet its goal of 100% zero-emission vehicle sales for new light-duty vehicles by 2035. This skepticism, coupled with shifting brand dynamics and the uncertainty of incentive programs, underscores the fragility of EV adoption momentum in the Canadian market.

The findings highlight that while consumer interest in EVs is not collapsing, it is increasingly shaped by policy signals and brand trust. Automakers that can offer reliable dealer support, competitive pricing, and visible progress toward charging and ownership convenience will be best positioned to capture Canadian buyers as incentives ebb and consumer preferences evolve.

Consumer demand for electric vehicles (EVs) in the United States has remained stable in 2025, according to J.D. Power’s U.S. Electric Vehicle Consideration (EVC) Study. This year, 24% of new-vehicle shoppers say they are “very likely” to consider an EV and 35% say they are “somewhat likely,” unchanged from 2024. The findings suggest that despite market volatility and affordability concerns, EVs have secured a solid foundation of consumer interest. To build on this base, the industry must continue to deliver affordable products and expand education around EV ownership, especially in areas where consumer concerns may be overstated.

Cross-shopping activity underscores the opportunity for automakers. EV shoppers who are “very likely” to consider an EV explore an average of 2.9 brands, while “somewhat likely” shoppers cross-shop 2.8 brands. This aligns with broader sales data showing EV buyers shop more dealer brands than gasoline vehicle buyers. The trend demonstrates strong potential for mass-market and premium brands alike to capture buyers outside their traditional customer base.

Charging access remains the biggest barrier, cited by 52% of shoppers rejecting EVs. However, concerns about purchase price and cost of ownership are easing, with rejection due to price falling 4 percentage points to 43% and cost of ownership concerns dropping 2 points to 33%. The affordability gap remains pronounced: younger consumers (ages 25-49) are most open to EVs but often lack the income to afford them, while older consumers typically have the means but show lower levels of interest. This tension highlights the importance of mass-market EVs to bridge affordability and demand.

Regional variation persists. Midwest states—including Wisconsin, Kentucky, Minnesota, and Ohio—report the lowest EV consideration levels, influenced by cold-weather performance concerns and stronger loyalty to traditional automakers. By contrast, coastal regions continue to show stronger interest, pointing to an uneven adoption landscape across the country.

Now in its fifth year, the U.S. EVC Study reaffirms that while EV demand has plateaued, it remains resilient amid economic uncertainty. Automakers that prioritize affordable pricing, expand consumer education, and improve perceptions around charging will be best positioned to convert steady consideration into stronger adoption.

We’ve been talking about solid state batteries for years now, hoping they would be the holy grail for EVs so that range would increase to match gas vehicles, fewer batteries would catch on fire, and charging would take less time. Stellantis is now testing batteries in its fleet of Daytona cars in real world situations using solid state batteries from Factorial Energy. (https://lnkd.in/gvWtZ8ri)  We heard the CEO of Factorial speak at the recent SAE North American International Propulsion Conference in Chicago.  She seemed very confident in her technology, and now we will follow Stellantis’ on-the-road experiment to see if her confidence is validated.  All the major global battery makers are working on solid state batteries, but this is the first publicly announced road test of this battery technology. 

Our own recent expert survey of the Future of Batteries predicted solid state batteries would only capture 6 percent of EV production by 2035, though semi-solid state would also have another 6 percent of production.  One issue we’ve run into when discussing solid state battery manufacturing is that this technology requires a very different manufacturing platform than lithium ion batteries, which means companies would have to transition their current battery plants at great cost in order to manufacture solid state batteries. 

Cost also continues to be the main driver of EV pricing.  Auto companies are getting closer to selling EVs at close to comparable gas vehicle prices, but this includes the $7,500 government incentive.  Though solid state batteries offer some great advantages, how will the cost of transitioning and manufacturing these batteries affect the cost of an EV?  In the end, US manufacturers will need to be profitable selling EVs in order to survive competitive global pressures, while customers will need to be able to afford the price of these new EVs.

The University of Michigan Departments of Mechanical Engineering and Economics released a report recently in the Journal Nature Communications (https://lnkd.in/eRmg2aP4) that shows that labor intensity in US BEV plants at startup can be up to 10 times higher than US internal combustion plants, while in a maturing BEV plant, labor intensity can be 3 times higher.  This result contrasts with some early estimates that BEV production would lead to a smaller workforce.  The authors, Andrew Weng, Omar Ahmed, Gabriel Ehrlich, and Anna Stefanopoulou report that one of three BEV plants in the study was considered a maturing plant, about 10 years old, while the other two plants are much newer.  They estimate that it will take about 15 years for BEV production employment to mature to the point that makes it equal to ICE production employment.

Waymo has used a number of vehicles in its autonomous vehicle development program over the years.  Its six generation AV system will use China’s Geely Zeekr brand for its minivan robotaxi program.  Because Geely also owns the Volvo Group brand with R&D in Sweden, built by Geely in China, but AV software and hardware are designed and installed in the US.  This version of the Waymo AV system purports to address one of the main constraints on AVs, bad weather.  Waymo says that the more advanced sensor suite has been designed to better cope with bad weather, including freezing temperatures and snowy conditions. Some of the sensors can also clean themselves to ensure they can “see” even in adverse weather.  If this is true, it’s a major breakthrough for AVs, one that we were not sure if we would ever see.  We’re ready for the Waymo Takes On Minneapolis YouTube video! 

This article from Carscoops.com (https://lnkd.in/gchjX2rA)  provides some important context for the US 125 percent tariff on Chinese vehicles as well as the ban on Chinese and Russian vehicles that have certain connected vehicle technologies.  The tariffs and ban may not be forever, but it gives US, EU, Korean, and Japanese companies some breathing room to develop their own competitive EVs.  The Inflation Reduction Act provides massive amounts of investments for developing a US battery supply chain that will take many years to complete, while at the same time providing short term subsidies to companies to retool and consumers to purchase EVs.  That being said, how the companies use their time will be key.  Will they put forth the effort needed to design and build competitive EVs in terms of price and capability, or will they relax and live off the profits from selling gas vehicles.  The next 10 years will be crucial in determining if traditional car companies will survive into the future.

As we’ve been tracking new battery production facilities in the US as part of our EV Evolutions project, one of the main concerns, especially for companies that want to take advantage of the full $7,500 EV incentive that is part of the Inflation Reduction Act, is how to obtain lithium from inside the US or one of our trading partners. Electrek reports that SK On’s (South Korea battery company) agreement with ExxonMobil who will provide up to 100K metric tons of lithium via its lithium extraction project in Arkansas for its plants in Georgia is a win for both companies.  It provides SK On with the needed local lithium, and it provides ExxonMobil with a partner with high volume lithium needs that helps establish the economies of scale that an oil/gas company is used to. ExxonMobil's Arkansas project aims to extract lithium from underground saltwater deposits, aiming to produce battery-grade material with greater efficiency and reduced environmental impact compared to traditional mining methods.

How successful this project will be is something we will be tracking, but it provides one of the best examples of the oil/gas companies trying to transition to supply EVs as they supply gas vehicles.

This recent article in the NY Times talks about bi-directional charging as a way to balance the grid when millions of EVs are in the US fleet (https://lnkd.in/gahc5K2a).  It also talks about General Motors and Ford offering a battery storage service for home charging.  What’s missing from the article is the research from Pacific Northwest National Laboratory (PNNL) that has already established the balancing the grid protocol for EVs on the West coast but also in some other states.  Our Affiliate representative Michael Kintner-Meyer from PNNL will present his recent analysis of this topic at our upcoming July 17th Propulsion Strategies for the 21st Century that will focus on the Future of EV Charging.  He recently completed work for the US Department of Energy on this topic, so we’ll get the most recent information about his research and how we may see charging playing out in the future.

Most automotive people know about the 100 percent tariffs of Chinese EVs by the Biden Administration, but there are also tariffs on EV batteries and battery materials:  As noted on this White House Fact Sheet, the tariff rate on lithium-ion EV batteries will increase from 7.5%% to 25% in 2024, while the tariff rate on lithium-ion non-EV batteries will increase from 7.5% to 25% in 2026. The tariff rate on battery parts will increase from 7.5% to 25% in 2024. The tariff rate on natural graphite and permanent magnets will increase from zero to 25% in 2026. The tariff rate for certain other critical minerals will increase from zero to 25% in 2024.  All of these tariffs are designed to provide the US the time it will take to develop its EV industry within North America and with its preferred trading partners.  With the large lead China has on the rest of the world in battery technology, materials, and processing, it is estimated that the US will need nearly 10 years to catch up.  The tricky part will be that China will not stand still.  It will continue its R&D to develop EVs and batteries that will dominate in the interim.  We are seeing the EU struggle to manage China’s exporting of EVs that are now 20 percent of EU EV sales.  China may decide to build plants in the EU, but it is unclear if they then will have the cost advantage they have now, though they may still have the technical advantage.  We shall see.  This Analysis is part of our EV Evolutions project that tracks policy, technology, and sales in China, the US, and the EU. 

Argonne National Laboratory, a division of the US Department of Energy, offers a tool that estimates, at the zip code level, how much they will save by driving a plug-in hybrid or pure EV compared to gas costs in their area.  The tool called, Driving Electric:  Local Fuel Savings Calculator, is free and can be tested at: https://lnkd.in/gF2FQQqB.  This post is part of our EV Evolutions research project that tracks key issues related to EVs in the US, China, and the EU.

A recent report by researchers at the University of Michigan- School for Environment and Sustainability provides some important insights into the total cost of ownership (TCO) of electric and gas vehicles.  The authors, Maxwell Woody, Shawn Adderly, Rushabh Bohra, and Gregory Keoleian, take into account a variety of cost inputs such as purchase price, financing, taxes, fees, insurance, refueling, maintenance, repair, and home charging equipment for EVs as well as other parameters such as vehicle miles traveled, discount rate, and age of the vehicle.  They develop a comprehensive TCO model comparing across five vehicle classes, three powertrains, and three EV ranges. Using 14 cities in the United States and multiple charging scenarios, they investigate TCO variability based on location and use pattern.  They include adjustments for local gasoline prices, electricity rate plans, home charging access, and the impact of local temperatures and drive cycles on fuel economy, among other factors.  See the overview of the results at https://lnkd.in/d9iMtpuW and the report itself at https://lnkd.in/dZtQZV3S.

As part of our EV Evolutions research program, we provide updates on major announcements and technology innovations taking place in China, the US, and the EU.  In November, Motor1.com reported that New Jersey joined eight other states requiring manufacturers to sell only zero-emissions vehicles in the state by 2035.  Similar to other states, New Jersey will require a phase-in goal starting in 2027, where 42 percent of new vehicles need to have zero emissions.  Similar to some EU countries, New Jersey is increasing the emissions requirements for gas-powered vehicles to incentivize manufacturers to bring more diverse EV models into the fleet.  Many companies are targeting 2027 as a year when many new EV models across many segments will be available.  It will be interesting to see if these new models and the Inflation Reduction Act subsidies will be enough to bring more new vehicle buyers into the EV fold.  The New Jersey law does not force buyers to buy EVs, and it does not affect used vehicle sales.  One source mentioned that it does not preclude people from buying gas vehicles from another state and bringing them into the state, though there may be issues with registering them in New Jersey.  This is one of the challenges of allowing individual states to enact laws that affect only their citizens.

Read more: https://lnkd.in/gD_FXHfi

In this article, https://lnkd.in/geSqfbm7, from The New York Times, Stephen Porder, professor and the associate provost for sustainability at Brown University, discusses why EVs really are the best choice for the climate.  He explains the long term positive effects of the Inflation Reduction Act on EV pricing and infrastructure; the major improvements in battery technology that have already occurred and will continue to increase; the amount of emissions from EV manufacturing, charging, and usage that are still less than gas vehicles; mining EV materials that are changing through continued EV battery development; and the false equivalence of plug-in-hybrids.  He’s touching most of the EV bases, though without a lot of supporting evidence because of space restrictions.  But his optimism has some basis in fact.  Only time will tell how truly effective EVs will be in reducing global CO2 emissions, but time is also a barrier when it comes to managing climate change.

It’s not like EV buyers don’t already have a number of major differences to overcome compared to gas vehicles such as battery range, cold weather battery degradation, finding chargers, charging time, battery safety, uncertain resale value, potential higher insurance costs, and especially higher vehicle costs.  EV owners must now add a road tax charge to their annual vehicle registration. New Jersey recently enacted a new law that charges the most of all states for road taxes that are paid by EVs when registered annually ($250) - https://lnkd.in/ezJJVM5u.  New Jersey isn’t the only state requiring EVs to pay a share of road taxes, 20 other states charge $50-$200 for EV road taxes (https://lnkd.in/eHMykYFN).  Gas vehicles’ road tax is built into the cost of every gallon of gas purchased at a gas station, but it is more of a user tax because one pays more if one drives more and uses more fuel; whereas, the EV road tax is the same if one drives 10K or 100K per year.  We assume that this issue, like many new #EV issues, may change over time as states better estimate how much EVs should pay.  But in the meantime, the EV road tax is another part of the EV total cost of ownership that buyers must be aware of when purchasing an EV. 

At our EV Challenges and Opportunities conference in April, Brandon Boyle from Roland Berger provided some great insight into plans by manufacturers to not only measure and reduce their greenhouse gas emissions (Scope 1 and 2), but also those of their supply chains (Scope 3).  Suppliers are also working on their supply chains so that eventually the entire supply chain will be managing their emissions similar to the way companies working with Japanese manufacturers are expected to continually improve their processes and find cost reductions.  One of the tools used by companies to examine their emissions and those of their supply chains is the Science-Based Target Initiative (SBTi).  This global tool provides a framework and methodology for companies to set science-based targets that are in line with the level of decarbonization required to prevent the worst impacts of climate change. The initiative provides guidance on target-setting for different sectors and scopes of emissions, as well as verification and approval of companies' targets.  We’ll be discussing these targets in our future conferences and research as the industry prepares for sustainability.

During our recent EV Challenges and Opportunities conference, Gregory Keoleian, Professor and Director of the University of Michigan’s Center for Sustainable Systems, showed this graphic that describes the results of his life cycle analysis of greenhouse gas emissions on all counties in the US comparing pure electric vehicles, hybrid vehicles, and internal combustion vehicles as well as comparing sedans, SUVs, and pickup trucks. This analysis includes only modest improvements in current grid decarbonization.  BEVs outperform hybrids and ICE vehicles in nearly all counties in the US.  

Gregory Keoleian, professor at the University of Michigan, presented at our recent EV Challenges and Opportunities conference about his use of life cycle analysis (LCA) in analyzing auto industry sustainability over the last 25 years.  He presented this simplified slide that shows the different inputs into an LCA.  As he noted in his presentation, the details involved in an LCA for just one component or a whole vehicle can be numerous.  This complexity will challenge the manufacturers and their suppliers when gathering supply chain sustainability information across their supply chains.  In fact, in our recent survey of industry experts, they reported that measuring sustainability in automotive supply chains will be a difficult process for companies.

Brandon Boyle, Senior Partner at Roland Berger Consulting, spoke at our recent EV Challenges and Opportunities conference about the challenges the global auto industry faces in the near future as it transitions to EVs.  These include labor costs, uncertain demand and supply predictability, and general increased transportation costs.  All of these will challenge OEMs and suppliers to meet their cost targets in a very changed world from the pre-Covid era.  Many of these challenges could not only affect the profitability but the survival of companies over the next ten years.

Gregory Keoleian, Professor and Director of the University of Michigan’s Center for Sustainable Systems, presented some great research results about greenhouse gas emissions (GHG) in the US auto industry at our recent EV Challenges and Opportunities conference.  We’ll be focusing on a few of them in future posts, but this key findings slide from his group’s recent research on the effects of pickup truck electrification on GHG emissions shows some dramatic effects based on the cradle to grave lifecycle analysis of the pickup truck.  The time factor becomes the most important effect as it overwhelms the short term high levels of GHG emissions caused by battery production.  

Christopher Harto, Senior Analyst from Consumer Reports provided some very interesting insights into the future purchases of EVs based on their recent research on a random sample of 8,000 US households.  With the goal of turning over the entire US fleet instead of focusing only on annual sales, this graph shows how the four levels of potential buyers, based on their knowledge of EVs, map to the typical S-curve of new technology adoption for the entire US fleet.  It predicts a slow turnover of the US fleet in the 2020s and 2030s, but by 2045, nearly 90 percent of the entire 250+ million vehicle fleet in the US can be turned over.  This mirrors research we performed on the fleet turnover of alternative fueled vehicles nearly 10 years ago.  Until you get to 100 percent sales of EVs per year, the goal of turning over the fleet is elusive because every new vehicle stays in use for 12-15 years before it is scrapped.  

In our recent EV Challenges and Opportunities survey, our group of industry experts reported that manufacturers will be challenged to meet both their new supply chain goals, based on government incentives, and sustainability goals, based on government and ESG goals.  These results are not surprising if one considers that automotive supply chains go down at least 3 tiers of suppliers and are global in nature.  When it comes to sustainability, manufacturers must measure their whole supply chain effects as well as their own sustainability.  One important support mechanism for manufacturers is that suppliers must also measure their own environmental effects and their own supply chain.  In time, this will be manageable, but over the next ten years experts think it will be difficult.  These changes in the supply chain are a sea change from previous globalized supply chains, especially for technologies that have dual defense and commercial applications (radar, lidar, semiconductors, new materials).  We think this is the biggest supply chain transformation since manufacturers spun off their internal suppliers in the 1990s.  We’ll be spending one or two conferences next year finding out manufacturer and supplier supply chain strategies and how far along they are in their process.

Our automotive experts who are part of our recent EV Challenges and Opportunities Survey report that it will take about 6-10 years for traditional manufacturers to be profitable selling EVs.  This response is, at the same time, good news and bad news.  The good news is that 6-10 years is not a very long time in automotive manufacturers’ thinking.  The bad news is that it will take that long for the traditional manufacturers to transition to EVs.  It shouldn’t be a surprise to us, since our same experts predict only 27 percent market share for all EVs combined by 2030.  Could they be wrong?  Yes.  But they are probably not wrong on EV profitability.  Companies continue to struggle to setup their EV supply chains for materials, processing, and production of batteries.  The US government is supporting the transition through massive funding programs that we are finding out will be the most needed piece of the EV puzzle in order to jump start mining, processing, producing, charging and recycling batteries and EVs.  US consumers are, in general, not breaking down the doors of dealerships to buy the current EVs, but we are in a race against the climate that doesn’t care whether you speed up or slow down.  It will react to the amount of CO2 put into the atmosphere over time and respond accordingly.  

Our recent EV Challenges and Opportunity Survey examined Tesla’s challenges and advantages over the next 10 years.  Our panel of auto experts see competition from other manufacturers (external) and the need for more and newer models in their fleet (internal) as the two major challenges, followed by new battery technologies and raw materials (internal/external); and improved vehicle quality (internal).   The other four challenges were all internal challenges:  expanding their charging network, increasing scale production, managing service, warranty, and used vehicles; and finally, surviving the actions of their CEO.  Our Affiliates are receiving our complete report based on the survey this week.  We’ll be posting selected results over the next couple of months.

Our recent EV Challenges and Opportunity survey asked industry experts what are the top five aspects consumers desire in an EV.  The top five aspects, shown in the attached slide, are range, price, time to charge, battery life, and vehicle segment.  Three of the top 4 are battery related and numbers two and five focus on the price and type of vehicles available.  Though we are at the beginning of the transition to EVs, one cannot emphasize enough how important batteries will be to the future of EVs.  If we can get this right, the whole transition will be manageable and profitable.  We’ll be discussing the future of batteries at our upcoming 15th annual Propulsion Strategies for the 21st Century hybrid conference at the University of Michigan on July 18th.

Though the Biden administration would like to see 50 percent of new vehicle sales be EVs by 2030, our recent survey of industry experts for our recent EV Challenges and Opportunities conference predict that only 27 percent of new vehicle sales will be EVs by 2030 and that by 2035 only 42 percent will be EVs.  Of course, our experts may be wrong, but their estimates provide insight into industry thinking at the moment.  The traditional manufacturers are struggling to make the transition to EVs because of the significant profits they receive from selling ICE vehicles.  They’ve mastered this process, and now they must master another very different process profitably.  It is no easy task, and some of the company names you recognize today may not be here in 15 years.  

This map created by Reuters shows the major highway corridors in the US that are targeted for infrastructure spending on EV charging stations.  The dark green lines show corridors that have sufficient numbers of chargers, while the light green lines (that make up most of the map) are corridors that are pending.  These corridors are main commuter and cross-country routes for longer distance driving.  They do not include home charging that represents the most chargers now as well as in the future that will be used for many local and commuting EVs.  That being said, the dark green corridors are “sufficient” based on today’s volume of EVs, but they will not be sufficient for a mass transition to EVs where there will need to be many more chargers if not more charging stations to accommodate the longer times it takes to charge vehicles.   We’ll be discussing this topic at our upcoming EV Challenges and Opportunities conference on April 10th.