3 transformations you must know to get ahead in the shift to electrical vehicles

The race towards net zero emissions is on, and electric vehicles (EVs) are in the pole position.

As a whole, automobiles account for 29% of all emissions in the US. The environmental impact is drastic. And racing towards a tipping point. And with EVs — which produce zero emissions — accounting for only 3% of cars on the road, the gap between where we are and where we need to be is vast.

Consumers. the auto industry and the U.S. Government each realize that change needs to happen, fast. Enter the shift to EV.

And the shift is coming at a breakneck speed:

• By 2030, 50% of all automobiles sold must be EVs, mandated by Presidential Executive Order
• The Department of energy will supply $199 million in incentives to accelerate the shift
• Supply chains and manufacturing are the first sectors feeling the pressure to adapt
• This has spurned sharp, fresh demand — escalating by the day — for charging stations, chips, OEM parts and facilities to build batteries and EVs.
• Manufacturers have two options: install massive equipment upgrades, or build new plants.

The constant? Change. And with great change comes great opportunity.

But, what exactly will the future look like for the automobile industry? And how can your organization adapt — and thrive — in the shift to EV?

We foresee a net zero future defined by customer demand, yet driven by innovation in the automobile industry. And with a bounty of opportunity in the manufacturing, energy and construction sectors — for those willing to lead the charge.

Here are the three critical transformations you need to be on top of in the shift to EV.

What consumers want will drastically change

Consumers are growing increasingly aware — and alarmed — about climate change. Once an abstraction, extreme weather events are on the rise globally, opening people’s eyes to the severity of the crisis and causing big changes in the way we live and buy.

Consumer norms are undergoing a sea change. And by all appearances, those changes are permanent.

The U.S. Government has set new goals and expectations, directly in response to what consumers want today (and will want tomorrow) and with changes in-step with consumer behavior.

EV goals and expectations include:

• Prices for EVs will match prices for current vehicles by 2023.
• The US Government will provide consumers with incentives to buy EVs.
• EVs will be built in the United States.
• EVs will need to be equipped with batteries that meet consumer needs and expectations.
• Battery charging stations will be as readily available as gas stations.
• Manufacturers will produce EVs in every class of vehicle, especially SUVs.

Consumers are adapting to climate change. Now it’s time for the supply chain to catch up.

Manufacturers are driving new trends in the automobile industry

Leading automobile manufacturers are responding swiftly.

Not only are they taking the consumer pressures and government mandates in stride, but they’re actively pushing further innovation. In a time where change is the baseline expectation, pushing the envelope is a competitive advantage.

Take GM’s three-step approach:

1. GM has pledged to reach net zero emissions by 2040.
2. 30 new EV models are set to be in production by 2025.
3. GM is developing a smartphone app to make it easy for customers to find charging stations — a current obstacle in the way of EV adoption.

And Toyota, the world’s top automobile manufacturer, is also taking strides. By 2025, Toyota plans to release 70 new models by 2025. Decarbonization — achieved as fast as possible — is the company’s north star. Customers will be able to select from a range of low- and zero-emission vehicles like battery-electric, hydrogen fuel cell and gas-electric hybrid-powered vehicles.

But that’s not all.

In response to auto deaths (100 people were killed in auto accidents every day in 2020), and emboldened by advancements in machine learning and Tesla’s success, manufacturers are taking this opportunity to create safe, efficient and adaptable self-driving cars.

In the future, everyone will be a passenger. In a vehicle that’s safer for us — and the earth.

Your chance to lead auto innovation is now

What happens when consumer demand, government spending and industry innovation line up?

A gold rush. And the time to strike is now: the market cap for low-to-no CO2 products is worth $23 trillion — with demand on the incline. And with the US Government and auto industry’s one-two push for the supply chain to be located Stateside, the spend will concentrate here.

And there’s an immediate need for change in manufacturing and infrastructure:

• To accommodate EV production, assembly lines will need to be updated.
• Some manufacturers plan to add new production lines for their EVs.
• America’s power grid will be in urgent need of upgrading.
• Demand will increase for natural resources, leading to a boom in the mining industry.
• The job market for contractors and specialists will soar.
• To survive and profit in the net zero economy, plants will set their own sustainability and emissions requirements and goals.

In short, right now is the perfect alignment of demand and opportunity. And the EV boom has never been so lucrative — and likely never will be again.

Final Thoughts

Net zero emissions is the future. The shift to EV is a huge step in getting there. And with consumers, manufacturers and the US Government all on the same page, the demand is red-hot.

The shift is radical, saturating everything from the job market to the supply chain to the infrastructure. The organizations that innovate will reap the rewards.

Find out more about our solutions for the manufacturing sector

Be always the first to know by subscribing to our newsletter