Jan 2, 2020 - Energy & Environment

Electric vehicles face an uncertain policy landscape in 2020

Photo: Sarah Grillo/Axios

2020 is shaping up as something of a wildcard for electric vehicle markets as automakers face an uncertain policy landscape.

What's next: The number of models available in the U.S. and worldwide is surging, per BloombergNEF.

  • In North America, 104 electric offerings will be on sale by the fourth quarter, up from 79 in Q4 of 2019. New models available in the U.S. will include the Tesla Model Y, the Ford Mustang Mach-E, the Rivian R1T and the VW I.D. Crozz.
  • In the EU, the number will jump to 165 by the end of next year, compared to 119 in Q4 2019, while China will see a bump too, per BloombergNEF's projection that includes full electrics and plug-in hybrids.

Yes, but: Global sales have been slowing in recent months and more headwinds loom. In the U.S., the biggest wildcard is the 2020 election.

  • Democratic hopefuls want to bolster EVs with tough vehicle emissions rules, ambitious sales targets, and spending on charging infrastructure.
  • President Trump's re-election would be less bullish for EVs. The administration is weakening Obama-era climate rules, and opposes legislation to expand consumer tax credits for EVs.
  • Tesla and GM have already hit the per-manufacturer cap.

The European market looks like a different story, thanks in part to new EU carbon emissions rules for vehicles that take effect this year.

  • BloombergNEF sees European sales growing 32% this year, while The Guardian reports that 2020 "will see the launch of flagship electric models with familiar names, such as the Mini, the Vauxhall Corsa and the Fiat 500."

China, the world's largest EV market, slashed subsidies midway through last year, which has badly crimped worldwide sales levels.

The big picture: Data compiled by InsideEVs show that 2019 sales ran ahead of 2018 for the first half of the year, but then started dropping a lot.

  • They see worldwide sales finishing 2019 at around 2.15 million, just barely ahead of 2018.
  • A Sanford C. Bernstein note last month showed October sales down 31% year-over-year, owing largely to China's policy change, and sales were also sharply lower on a rolling three-month basis.
  • U.S. sales have also slowed, per Bernstein and S&P Global Platts.

The bottom line: "While many are hopeful that EV sales could be poised to rebound in 2020, significant costs associated with buying an EV and limited infrastructure remain a barrier to entry for many," S&P Global Platts president Martin Fraenkel said in a recent note.

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