Automakers are gearing up to produce new electric and hydrogen fuel cell vehicles—a byproduct of public policy and market demand.

The Inflation Reduction Act will reduce CO2 emissions by 40% from the 2005 baseline, thanks in part to incentives for electric and hydrogen cars. Automakers are shifting gears and moving into the fast lane to give consumers what they want. Indeed, Cox Automotive predicted that sales of new EVs in the United States will top 1 million vehicles for the first time this year. It already accounts for 7% of new car sales.

Take Toyota Corp.: Electric or hybrid cars currently account for 21% of its sales. The goal is 40% by 2025.

“Zero emissions from our vehicles is the ultimate goal and we believe the path to achieving that goal is through the portfolio – fuel cell vehicles, hybrid vehicles, plug-in hybrid vehicles and battery electric vehicles,” Toyota states this in its sustainability statement. “Offering a range of low-emission vehicles means we should be able to reduce as much CO2 as possible as soon as possible, which in North America means offering more plug-in hybrids and hybrids until the alternative fuel infrastructure is in place for hydrogen fuel cells and all the rest. -electric vehicles are expanding.”

The European Union is phasing out the internal combustion engine by 2040, while the Biden administration wants half of all vehicles sold in the US to be electric by 2030. The electrified transport sector goes a long way towards keeping temperature rises under control.

To that end, the Inflation Reduction Act provides a $7,500 tax credit for electric cars beginning this year and lasting ten years. This advantage previously disappeared if the automaker sold more than 200,000 cars. But the credit has certain limitations and applies only to less expensive models.

Electric vehicles make up 2% of the world car market. The US Energy Information Administration says that electric-gas hybrids will make up 34% of cars in developed countries and 28% in emerging economies by 2050. Edison Electric Institute plans 26.4 million electric vehicles by 2030.

“Every new vehicle eventually becomes a used vehicle,” said Jonathan Smoke, the company’s chief economist Cox Automotive. “Our data sets show that used EV sales will begin to increase rapidly from here, following a clear path set by new sales.”

The future is here

Ford is also electrifying its cars, including the Mustang, the F-150 truck and the E-Transit. It will produce more than 2 million EVs by 2026. By 2030, electric vehicles will account for half of global volume: two-thirds of European commercial vehicle sales will be fully electric or plug-in hybrid vehicles by 2030, and all European commercial vehicles will be zero-emission by 2035. Now it’s electric cars. technology and charging infrastructure and will continue to do so: at least $50 billion in EV and battery production between 2022 and 2026.

And last year, Volkswagen said it delivered more electric cars worldwide than ever before: 369,000 electric cars, a 73% increase over 2020. That includes 106,000 plug-in hybrids that run on both electricity and gasoline.

The goal is full electrification of the new vehicle fleet. By 2030, at least 70% of all Volkswagen sales in Europe will be pure electric vehicles. In North America and China, the share of electric cars in unit sales could reach 50%.

“By again significantly exceeding our CO2 targets, we have demonstrated our rapid and systematic approach to sustainability and the transformation towards e-mobility through our ACCELERATE strategy,” he said Volkswagen CEO Ralf Brandstätter. “Thus, we significantly contribute to meeting the Paris climate goals.” This year it is adding new models on a regular basis.

But what about hydrogen fuel cell cars?

Honda, Hyundai and Toyota make fuel cell powered cars. And BMW is showing off those cars that use the Toyota fuel cell. For example, Honda works with General Motors
GM
develop its fuel cell system and plans to sell 60,000 of these cars by 2030.

Bloomberg New Energy Finance says that hydrogen could cover 24% of the world’s energy consumption by 2050 while reducing CO2 levels by 34%. This can be done at a reasonable cost if favorable public policies are adopted that include carbon pricing.

The advantage of hydrogen is that it is abundant, renewable and does not pollute the environment. Water vapor is the only byproduct of a fuel cell car that runs on hydrogen. And they can go much further than electric cars before needing to refuel – a process that takes just 10 minutes.

However, transporting hydrogen through pipelines is about 30% more expensive than transporting natural gas.

Toyota CEO Koji Sato believes hydrogen is vital to achieving global net zero goals. Electric cars have a head start and an inside track on the sustainable car market. In addition, they have the infrastructure to support continued growth. However, global policy makers are also recognizing hydrogen fuel cell cars for their zero emissions.

“Countries around the world are waking up to the critical role that green hydrogen can play in increasing energy security and reducing greenhouse gas emissions. Until now, however, it has been too expensive to introduce it on a large scale,” adds Hanna Breunig, p Lawrence Berkeley National Laboratory Sustainable Energy Systems Group.

Change takes time. But it will come to the car market and take off in full swing by the middle of the century. Automakers are revving their engines to ensure they stay ahead of market and regulatory trends.

See also:

Can utilities prepare the market for a flood of electric vehicles?