COVID-19 is good for EVs, used cars, subscription, connectivity and LCVs

Yesterday, the European Association for Electromobility, Avere, hosted a webinar around the question whether the corona crisis could open the door towards a more ambitious zero emissions transport agenda. This is what Fleet Europe distilled as key takeaways from the contributions by Kevin Kelly, Senior Consultant for Mobility at consultancy firm Frost & Sullivan, Ismail Ertug, Member of the European Parliament, Renske Schuitmaker, Public Affairs Manager at Dutch fast-charging company Fastned, Michael Keller, Leader for Development Coordination for Charging and Charging Infrastructure at Volkswagen Group, and Daniel Mesa, Member of the Cabinet of the European Commission Executive Vice President for the European Green Deal Frans Timmermans.

EV sales will recover faster than ICE sales. The global GDP won’t reach pre-COVID-19 growth levels before Q2 2021 and it will be 2023 before the worldwide annual light vehicle production will reach 90 million units again. Still, the EV market is more resilient given the Café compliance obligations. COVID-19 will have but a low impact on battery cell production and the deployment of charging infrastructure, according to Frost & Sullivan.
EVs and crossovers emerge the winners of the crisis. The number of EV models might be reduced to cut costs, but OEMs need BEVs and PHEVs to comply with CAFÉ standards. They also need crossovers and SUVs, because that is what the market wants (Frost&Sullivan). (Editor’s note: this is substantiated by recent Jato data: SUVs continue to gain traction at the expense of traditional cars. It is clear in all segments, from the entry-level ones to the luxury ones. As they share most of their parts and their platform with existing models, making them hardly more expensive to build, whereas they create more margin).
Shared mobility, carpooling and MaaS are under threat. Hygiene concerns will keep people from using shared cars, bikes, scooters and ride hailing, with possibly a late and slow recovery. Frost&Sullivan also reckons Mobility as a Service will see a sharp decline, followed by a slow convalescence.
Vehicle subscription, used car sales and leasing, short-term lease will grow. Customers want flexibility, which is offered by subscription programmes and short-term lease. As budgets are limited and uncertainty prevails post-corona, used car sales are expected to increase as well (Frost&Sullivan). Used car leasing is even expected to grow 29.6% year-on-year.
LCV leasing and connectivity will gain importance. As e-commerce, on-demand service models and feature on demand (FOD) will grow exponentially, more LCVs will be leased and connectivity will play an ever greater role (Frost & Sullivan)
The 95g target should not be postponed. That is the stance of the EU representatives present in yesterday’s panel. Whether fines will be leveraged is the topic of much discussion. Three elements make things difficult for OEMs to comply: the postponed launch of new EV models – not only due to factories shutting down, but also homologation delays, a shortage in battery cells and
Today’s cleaner air in cities should support e-mobility transition. City air is cleaner than ever. People don’t want to go back to pre-corona pollution levels. Transport accounts for 14% of total carbon dioxide output. By 2050, it should be zero. What is needed, is a consistent and future-oriented masterplan to ensure an interoperable, digital and connected charging ecosystem. The building blocks are a regulatory framework, direct public funding and tax incentives, says VW Group.
Europe should facilitate private charging infrastructure investments. Today, companies like Fastned find it hard to gather funding and are struggling to get access to certain markets due to red tape and local legislation. The EU should provide support in these areas.
Let’s take Norway as an example. Recent Norwegian new car sales figures show that EVs were less impacted by corona than ICE vehicles. The Norwegian recipe for EV success is as simple as it is effective: make them cheaper to buy than ICE, provide plenty of practical perks (free parking, use of bus lane) and make sure charging stations are plentiful.
V2G must be accelerated. Today, only EVs using the ChaDeMo charging standard – i.e. Nissan and Mitsubishi – can charge bi-directionally, meaning they can give back power to the grid (V2G). Vehicle-to-grid is absolutely necessary to make mass e-mobility possible and increase the share of renewable energy. All Western OEMs work with CCS (Combined Charging Standard), which needs further development to enable V2G.