Electric vehicle demand may not materialize as quickly as anticipated, new report says

SANTA MONICA, Calif. - Automakers may not be able to build as many electric vehicles as they would like - and consumer demand for those EVs may not materialize as quickly as anticipated if government and industry don't address and resolve a convergence of issues, according to a new study released on Tuesday.

One of the macro trends that are charted in the 2023 Moving World Report, published by investment firm UP.Partners, could put government mandates in conflict with manufacturing reality due to a shortage of battery raw materials.

The report said that there are obstacles to the acceleration of EV production and demand in the United States, including ongoing turmoil in global supply chains, insufficient vehicle charging infrastructure and an overloaded electrical grid.

A global price war, ignited by leader Tesla, is likely to cause EV battery demand to increase tenfold, or more by 2030, but the report notes that a massive dislocation between demand and supply of key materials, such as lithium, cobalt and nickel, is likely to increase the cost of EVs to consumers.

The study is based on dozens of interviews and cites technical and financial data from research studies by the International Energy Agency, the U.S. Energy Information Administration, McKinsey, Silicon Valley Bank, Carnegie Mellon University, and others.

In keeping with its focus on people and goods on the ground, in the air, in space, and in space, UP has looked beyond terrestrial vehicles to aviation, where it noted the dramatic rise in cargo drone deliveries in 2022 and a potentially crippling shortage of pilots by 2030.

As aviation companies continue to pursue alternative technologies from batteries to hydrogen, Managing Partner Cyrus Sigari said that sustainable aviation fuel is the only viable way to reduce emissions over the next 20 years.