New Reports Show Electric Vehicles Continue to Race Ahead in Market Share, Price Parity, Feasibility

(Washington. D.C. – June 22, 2023) The growing market strength and feasibility of all types of new electric vehicles – from cars to freight trucks – is reflected in three new reports prepared for Environmental Defense Fund.

EDF unveiled the reports as part of its comments to EPA in support of the agency’s proposed greenhouse gas standards for new heavy-duty vehicles. Those comments emphasize that EPA’s proposal is “eminently feasible” and calls on the agency to adopt even stronger standards that help deliver more new zero-emitting freight trucks and buses nationwide.

“More protective standards are clearly achievable thanks to momentum from historic investments in the Inflation Reduction Act and Bipartisan Infrastructure Law, manufacturer commitments to levels of new zero-emitting vehicle deployment that exceed EPA’s projections, and ongoing adoption of California’s Advanced Clean Trucks rule by states,” said Alice Henderson, Director of Transportation and Clean Air Policy for EDF. “We also think EPA has a vital opportunity to strengthen the proposed standards for key segments, including new school buses and tractor trailers.”

The reports were prepared for EDF by Roush, Analysis Group and ERM. All three bolster the feasibility of strong pollution standards for both new light-duty vehicles (cars and passenger trucks) and new heavy-duty vehicles (commercial vehicles including delivery trucks, buses, school buses, garbage trucks and freight trucks).

Roush prepared its report on Class 7 and Class 8 Tractor–Trailer Electrification for MYs 2030 and 2032 for EDF. Among its findings:

• Medium and heavy-duty trucks move about three-quarters of all cargo in the U.S., covering about three trillion vehicle miles each year. However, about half that cargo, by weight, is moved less than 100 miles – meaning a significant portion of trips can be completed by an electric vehicle on a single charge. That in turn means a large proportion of charging can occur, for lower cost, at the depot.
• The cargo capacity of most battery electric heavy-duty vehicles will be at par with diesel vehicles by 2030.
• In 2030, the total operating costs of battery electric heavy-duty vehicles will be significantly lower than diesel trucks across all segments of the market due to extensive maintenance and fuel cost savings, with a payback period for upfront costs (which includes charging equipment) of less than three years for all vehicles. Battery electric heavy-duty vehicles will also have a lower total operating cost per mile even with significant en route charging.
• With the tax credits available under the Inflation Reduction Act, the upfront cost of most new battery electric heavy-duty vehicles will be the same amount or cheaper than diesel vehicles, excluding charging equipment. That’s a conservative estimate by Roush that assumes higher costs for domestically produced batteries, but an increase in battery manufacturing in the U.S. facilitated by the same law will likely drive the cost of new electric trucks down even more.

The report found the U.S. is “well-positioned to transition to electric Heavy-Duty trucks thanks to supportive policies, technological advancements, and emerging business models” as well as new tax incentives and government support to build necessary infrastructure. It also found that EPA’ s proposed greenhouse gas standards for heavy-duty vehicles will further accelerate the deployment of new zero-emissions trucks.

Analysis Group’s report, Heavy Duty Vehicle Electrification Planning for and Development of Needed Power System Infrastructure, looked at the  potential impacts of an expanded zero-emissions vehicle fleet on electric distribution systems. It found the “overall magnitude of growth in demand that would result from EPA’s proposed rule is very small relative to historic periods of growth in the electric industry, and will not pose a challenge from the perspectives of power system generation or transmission infrastructure needs.”

The report also found that “the majority of utilities and counties in the country will not face the need to increase distribution system capacity at a level that is qualitatively different from past system infrastructure needs driven by traditional growth in electricity demand within their service territories,” and that “there are many emerging technologies, ratemaking practices, and distributed resource solutions that have the potential to significantly and efficiently reduce the expected impacts on distribution systems associated with vehicle electrification.”

ERM’s Electric Vehicle Market Update of April 2023 adds to earlier research done for EDF. The updated report found that electric vehicle sales and model availability have both grown rapidly and are continuing to rise:

• By the end of 2022, more than 10 million light-duty electric vehicles were sold worldwide – one in every seven cars sold overall.
• Americans bought more than 800,000 light-duty electric vehicles in 2022, a 65% increase from 2021.
• U.S. sales of electric vehicles reached more than 258,000 in the first quarter of 2023, an almost 45% year-over-year increase.
• The U.S. is projected to have 197 models of electric cars and passenger trucks on the market by the end of 2025, up five percent from the projection in the last Electric Vehicle Market Update.
• Worldwide, almost 200 more models of electric medium and heavy-duty vehicles became available for purchase between 2021 and 2022.

ERM’s report also catalogues significant manufacturer commitments and includes several new commitments since the last update:

• Honda announced its goal of achieving carbon neutrality by 2050, as well as new partnerships with General Motors to co-develop electric vehicles worldwide starting in 2027 and with Sony to produce battery electric vehicles in North America in 2025 (under the brand Afeela).
• Mitsubishi announced that it expects 100% of its global sales to come from electric vehicles by 2035 and will release four new models in that timeframe, including ones from partnerships with Nissan and Renault.
• Stellantis’ Jeep announced plans to release four new electric models in North America and Europe by the end of 2025, including the launch of an electric Ram pickup truck.