What Volvo’s Announcement Means to Us

Recently, Volvo made a stunning announcement: it has committed to selling only battery-powered EVs by 2030. Not just in Europe, mind you. Everywhere. The news comes on the heels of recent automaker reports showing a surge in worldwide EV sales and the official unveiling of Volvo’s second BEV this past Tuesday – the C40 Recharge crossover coupe. (The XC40 introduced in 2018 was the first.) See more details in the article here: https://www.newsmax.com/Finance/streettalk/volvo-electric-vehicles-ev-online/2021/03/02/id/1012158/

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2018 Volvo XC40
Photo Courtesy of Vauxford

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Why are we so excited by this? After all, Volvo’s just one manufacturer, right? Well, for several reasons. First, Volvo has been an innovator in the automotive space since it introduced the three-point seatbelt in 1959, and more recently blind spot warning, pedestrian detection and rollover protection systems that have been appropriated by rivals. It’s therefore likely that other manufacturers of ICE vehicles will follow suit as EV demand continues to drive supply. (And profits.) Of course, this means more charging installations will be required, particularly in places like schools, parks, restaurants, daycares and other family-centered locations that play to Volvo’s customer base.

In addition, Volvo notes that the C40 Recharge will sell only online, while the company’s head of commercial operations said he expects half of all vehicle sales to be online by 2025 in furtherance of their progressive agenda. This affords other forward-thinking companies the opportunity to create complementary web-based services to help Volvo in its pursuits. For instance, the new EVCS subscription plan could be coupled with online vehicle sales as a discounted add-on.

All of this signals a larger trend in the growing embrace of EVs by the general public – one that Volvo executives are confident enough to get behind with large sums of investment dollars. In fact, the company recently announced it would sink approximately 5% of annual revenues into EV R&D, an amount equaled to about $1.5 billion USD. One can imagine that the amounts spent on marketing and advertising will likewise be ambitious. As both awareness and vehicle options grow, so will sales.

Such marketplace expansion reminds us of Wright’s Law, which essentially states that the cumulative doubling of a technological innovation will result in increased production volume that reduces costs. (For those not familiar with this axiom, read more about it here: https://ark-invest.com/articles/analyst-research/wrights-law-2/) EV technology is no exception. And the fact that new EV sales topped 2.2 million in 2019, according to the IEA, as EV manufacturing costs saw a 28% drop is no coincidence.

Riffing off the Volvo announcement then, a potential 20-fold increase in the number of Volvo EVs on the road is going to significantly reduce the overall cost of subsequent models, making them even more accessible to lower income drivers and thereby further increasing overall EV adoption. Preparedness will be key. A big new wave of EVs will require far more charging sites and will increase the appetite for government incentives. As we see the sector scale, the lower price of EVs themselves will be coupled with other cost reductions resulting from more abundant charging stations, V2G technology and various dynamic charging innovations.

Volvo competitors eager to “keep up with the Joneses” have already started introducing new EV models, from the Hyundai Kona EV and Mustang Mach-E to the Audi Q4 e-Tron and BMW iX3, demonstrating that the “EV-olution” is already underway. The question is who will create the necessary support structure. EVCS is already taking the lead on generating modernized charging infrastructure throughout California, with other states soon to follow; our goal is to make sure the country is ready for the anticipated deluge of BEVs that will be hitting the road in the next decade and beyond.

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The Race to Democratize Charging Infrastructure

According to McKinsey & Company, “As the number of EVs on the road increases, annual demand for electricity to charge them would surge from 11 billion kWh now to 230 billion kWh in 2030… Modeling indicates that nearly 30 million chargers would be needed to deliver so much electricity in that year. While most of these chargers would be installed at residences, 1.2 million would [need to] be public chargers.” More importantly, these public chargers must be targeted to drivers of all ages, genders, races, cultures, income levels and geographic segments. As such, EVCS has identified three primary areas necessary to increasing the democratization of charging infrastructure:

Navigating California’s New EV Mandate

California’s going all in on electric. On August 25th, Governor Gavin Newsom made a very important announcement concerning the future of transportation in the Golden State: “We can solve this climate crisis if we focus on the big, bold steps necessary to cut pollution. California now has a groundbreaking, world-leading plan to achieve 100 percent zero-emission vehicle sales by 2035.” Big and bold, indeed. And while highly encouraging, it brings up a number of questions moving forward.

How EVCS is Repairing Reliability Concerns

One of the biggest concerns among EV drivers today is the reliability of public chargers. One recent survey from the Department of Bioengineering at UC Berkeley claims as many as 23% of public chargers in the Bay Area alone are, as Wired sums up, “nonfunctioning at any given time, stymied by broken screens, shoddy credit card or payment systems, network connection failures, or damaged plugs.” And that’s in a locale prioritizing the conversion to electric. Testimony from motorists seems to corroborate these findings. A CEC survey of 1,290 EV drivers found that fully 60% had experienced damaged or inoperable chargers, while almost half needed assistance from customer service. We find this wholly unacceptable and have taken measures to ensure that chargers in the EVCS network rise to the standard of operability our customers expect. Here are a few ways we’re doing that:

Installation of the Month (July 2022): Kenwood Inn & Spa

A key focus for us over the last several years has been the installation of additional chargers at holiday hot spots, tourist destinations, and other key points of interest. Not only will it help dispel long-range travel anxiety among many new EV drivers, but it will also lead to a significant reduction in carbon emissions otherwise generated by gas-guzzlers during peak vacation seasons. Moreover, our egalitarian approach to site selection means we’re just as likely to install a charger at a McDonald’s as we are at a Morton’s since we understand the value in catering to a broad clientele. However, higher net worth individuals continue to drive EV sales in the US (a June 2021 Fuels Institute study specifies middle-aged males with household incomes over $100,000), so catering to venues that offer a luxury experience will encourage even greater participation by this group while serving as a bellwether for lower-income drivers who are attracted to the idea of electric mobility as a symbol of status.