Promises won’t kill the combustion engine

Leonid Bershidsky

European governments are making big promises to ban the sale of cars with combustion engines: Germany by 2030, France and Britain by 2040. It’ll take a lot more than promises, though, to bring about the all-electric future.

The initiatives could become the biggest government-driven revolution in a major market since anti-tobacco legislation – and a benevolent one, given that car makers get fair warning. But it’s easy to tout the end of an era with non-binding promises, and much harder to get enough people to like a genuine zero-emission car (that is, one whose only contribution to emissions is made by the energy industry as it produces electric power).

Granted, electric vehicles already have a lot of fans. People like the idea of reducing their carbon footprint, as well as electric cars’ fast acceleration and noiselessness. Tesla has a big order backlog, and predicted resale values are good: In the most recent German rankings, two of the three electric leaders –  Hyundai Ioniq and BMW i3 –  were expected to retain more than 60 percent of their original price after four years. In the U.S., 30 percent of buyers consider an electric car, compared with close to zero as recently as four years ago.

The reality of electric cars, though, remains at odds with their promise. Consumers tend to balk when they get a sense of the range limitations (producers’ estimates are valid only under specific conditions) and consider the strategic aspect of planning their driving around charging opportunities. No more than 10 percent of those who consider an electric vehicle actually buy one, and older electric cars with short ranges are worth a lower percentage of the original price than even much-maligned diesels. And then there are the longer-term questions of whether the charging infrastructure will keep up with the number of vehicles, and whether electrical grids will be able to handle all the added demand.

Probably the biggest shifts in the European auto market are happening in diesel, which major cities plan to ban sooner than combustion engines. In the U.K., demand for diesel cars dropped 10 percent in the second quarter of this year. Still, the declines haven’t yet been severe enough to affect residual values much. In Germany, where diesels are sitting on dealers’ lots an average of about 12 days longer than gasoline-powered cars, the resale value of an average three-year-old diesel car is still similar to a gas-powered one.

The campaign to convince consumers that the combustion era is ending and electric is taking over is working about as well as anti-smoking campaigns did before cigarettes were banned in most public spaces and became prohibitively expensive for many smokers. Some people believe what they’re told and grow enthusiastic about the new era and the next big thing. Most, however, see no reason to change their habits. Financial incentives can help by bringing electric-car prices close to those of traditional vehicles –  but they’re not enough for a breakthrough. Only countries such as Norway, where the incentives make electric vehicles appreciably cheaper to buy and own, have seen significant uptake.

Governments are rightly hesitant to force something on consumers that doesn’t really work for them –which is why countries that plan to ban combustion engines in new cars haven’t actually legislated on it yet. Driving a combustion engine car hasn’t acquired the stigma of smoking, and it may never do so. Unless the current gas station infrastructure disappears –  unlikely, given that used combustion engine cars won’t be outlawed –  gas-burning and hybrid car sales might even boom in the few years before bans go into effect. And that’s if the bans actually happen.

That’s a big “if.” Regulators won’t take the plunge unless electric cars already make up a majority of purchases –  without subsidies and other crutches, since no country can afford to subsidize most car buyers. That will happen only if the electric car can match the real-life range of its combustion counterpart, and if charging takes only marginally longer than fueling.

Automakers are racing to get there. Toyota is reportedly in the production engineering stage of building a solid-state battery, which employs a solid electrolyte to improve on the weight and range of a lithium-ion battery –  and possibly even on the charging time. Such advances could not only boost demand for electric vehicles but also decide the winners and losers in the industry, which is why it’s worth watching companies’ research and development budgets.

Toyota’s leading investment could make it the first automaker to produce an electric car that most consumers will actually want. Other major manufacturers’ budgets also exceed a billion dollars per quarter, some of which is going into battery tech (Daimler and BMW, for example, are also working on solid-state batteries). Tesla, the current market icon, isn’t big enough to match that level of spending, and so risks being left behind in the final push to make the electric vehicle for the masses.

But there’s also a chance that the research efforts will get nowhere, or produce technology that people can’t afford. In that possible future, governments won’t be bound by their electric promises, and the combustion engine –  albeit an emission-minimizing version of it –  will remain the car market’s mainstay.

Leonid Bershidsky is a Bloomberg View columnist. He was the founding editor of the Russian business daily Vedomosti and founded the opinion website © 2017, Bloomberg View.


  1. The electric car revolution will continue and will only speed up as battery and charge station technology continues to improve on a daily basis. Every major vehicle manufacturer is now chasing Tesla Motor Company and for good reason. When was the last time you ever heard of a car company introducing a new model that was years away and the line formed immediately to drop $1000 dollars on a vehicle that had never seen except for drawings, touched or even had the specs. Let’s not forget the company out of China, BYD that sold more electric vehicles than Tesla, Ford, Nissan, GM, and Toyota. Warren Buffet is the major stock holder in the company and the average range on each vehicle is over 280 Km and fast chargers that can recharge in less than 1 hour. Cayman Automotive Leasing, Sales and Service will be introducing the full line of BYD electric vehicles in the Caribbean in October. The BYD electric buses are a real statement when it comes to engineering excellence and considered the best in the market. My home town in Columbia, Maryland just purchased several of the BYD Buses to be used in the local Transit System. In closing, to counter the argument about the source of generating electricity to handle the grid, consider this, electric vehicles can now support the grid while parked with the new Vehicle to Grid Technology (V to G). Ten electric vehicles could pump 240 Kw to the grid with the push of a button.

  2. OK. While I was in Israel, I drove an electric car. No big deal. What was a very big deal, was the already charged car battery replacement station. NOT RECHARGING. Here is how it worked. You drive your electric car ready for a charge into the station. Your car is placed on the lift. The old battery comes out and a newly charged battery replaces it. On your way you go, in about 10 minutes. NO waiting around for a charged battery. This is brilliant. Now this would make electric cars a little more palatable. Right now they are too limiting in many areas. Distance, time to charge etc.

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