April 12, 2024

The European EV pause offers temporary opportunities for plug-in hybrids

Mazda appears to have picked the perfect time to launch its plug-in hybrid MX-30, just as Tesla’s faltering sales underline the point that electric cars aren’t yet ready for prime time.

Concerns about the high price of electric cars raising concerns about range, their rapid depreciation and eye-watering insurance costs appear to point the way for plug-in hybrids to entice potential car buyers.

After all, if you’re a typical motorist who drives less than 50 kilometers a day, a plug-in hybrid (or this range extender) could mean that all your daily use will be exclusively electric, and in the rare case you drive long distances , the combustion engine can kick in and give you a range of up to 400 miles at highway speeds, effectively more than twice as much as the best electric cars.

The problem is that European CO2 emissions rules will make it increasingly difficult for PHEVs to compete with pure EVs and will ban them by 2035. Some experts claim that this will close an efficient and popular choice.

The Mazda MX-30 R-EV has a battery that can drive more than 80 km electrically. When the battery is empty, or when some extra power is needed for overtaking, the 830cc rotary engine is switched on to generate electricity. It is always powered by the battery.

Electric car sales in Europe and the US have been faltering recently, and brands such as Volkswagen, BMW, Mercedes, GM and Ford have been forced to scale back their ambitious targets.

Tesla’s sales problems in the first quarter, despite a warning from CEO Elon Musk, led to a stock market ruckus and media whining about the future of electric cars in favor of plug-in hybrid electric vehicles and regular cars. hybrids. (PHEVs can drive up to 70 miles on electric power alone. Hybrids may be able to drive for a mile on electric power alone, while the computer manages a combination of battery and combustion engine to improve efficiency and therefore range).

But long-term forecasters suggest this setback for electric cars is a temporary blip. According to investment researcher Jefferies, EV sales in Europe will rise from around 2 million in 2023 to 8.9 million in 2030 for a market share of 65% versus 16%, while PHEVs will slowly decline from around 1 million last year to just over 800,000 . in 2030 (7.7% versus 6.0%). Investment bank UBS estimates that electric vehicle sales will reach 9.6 million in 2030, while PHEVs will slowly rise in 2028 and then fall to around 900,000 in 2030.

A powerful factor behind the likelihood that EV sales will resume a strong upward trend at the expense of PHEVs is EU regulations, which insist that 100% of all new car sales will be electric-only by 2035. Carbon dioxide emissions regulations are making it increasingly difficult to include an internal combustion engine, even if it runs alongside a battery.

Matt Schmidt of Schmidt Automotive Research was one of the first signs that there would be a lull in electric vehicle sales in Western Europe, caused by a change in EU rules.

“Our forecast will remain the same for BEVs as we have fully taken into account the slowdown in growth in 2024, given the change in EU CO2 emissions legislation from 2025 and established manufacturers deliberately planning a slowdown in 2024 and again from 2025 accelerate to stay compliant,” Schmidt said in an interview.

Schmidt expects EV sales in Western Europe to reach 8.4 million or 60% of the total market by 2030, compared to just under 2 million in 2023 (16.9%).

“We expect Western European PHEV volumes to hover around 1 million units annually in the near future,” Schmidt said.

Schmidt said PHEVs are mainly favored by higher-end manufacturers.

“We expect premium manufacturers will continue to deploy PHEVs to meet (EU) targets up to 2030 due to the profitability and cost benefits they bring, while mainstream volume manufacturers are likely to introduce milder hybrid models,” Schmidt said.

Last year, the top PHEV sellers in Europe included the Ford Kuga, Volvo XC-60, Mercedes GLC and BMW 3 Series.

(Mild hybrids use a 48-volt electrical system to power components previously powered by the engine, allowing for greater efficiency.)

But by 2035, the EU has banned hybrids, PHEVs and anything with an internal combustion engine (ICE). This decision will surprise citizens who drive only a limited number of kilometers per day, want the practicality of a PHEV, but do not trust electric vehicles due to doubts about range and price. They want the freedom to hit the highway once a year and go to the sun, without fear of the distance.

The push by politicians in Europe and the US to declare that electric cars alone are the best way to reduce global CO2 emissions will waste valuable and proven resources that could be provided by hybrids and PHEV technology, say expert engineers as Kelly Senecal of the ONS

That is one of the conclusions of a recent book “Racing Toward Zero”, written by Senecal and Felix Leach from Great Britain

Hybrids, PHEVs, and now this Mazda rotary engine solution, use small batteries compared to the huge BEV batteries and avoid consuming large amounts of scarce and likely increasingly expensive raw materials such as lithium, nickel, cobalt and copper. They also offer a more affordable option. If battery-only electric cars come to dominate the market, it will likely drive the average earner out of their car.

“Banning plug-in hybrids would eliminate a potentially ideal solution for many drivers in Europe. PHEVs offer the freedom to drive without tailpipe emissions in city centers, while retaining the flexibility and range of a combustion engine for longer distances,” Senecal said in an email exchange.

Green lobby organizations such as Brussels Transport & Environment do not agree with this. In a report “Plug-in hybrids: a dangerous distraction” published last year, T&E said PHEVs should not receive tax breaks from governments because they do not contribute to CO2 reductions and could even make them worse.

T&E said commercial vehicle drivers often have no incentive to run on battery power alone, so the PHEV’s increased weight makes its overall fuel efficiency worse than that of an ICE vehicle. This could be solved with geofencing, which would penalize non-use of the battery-only range.

But these criticisms are of little use to private buyers with low average annual mileage, who are unconvinced by the effectiveness of battery-only vehicles, and who would be denied a vehicle that could be purely electric for perhaps 90% of its use are.

Meanwhile, this pause in the EV growth trajectory and the predicted massive resurgence is a huge assumption. To get from the 2 million sales now to, for example, 9 million in 2030, a revolution in the available type of EV is needed. They will be much cheaper and smaller – say €10,000 ($10,800) – and designed for urban use. Currently there are no European contenders in this new EV class. They exist in China, and the first European contender is unlikely before 2027.

This potential existential threat from China has led leading manufacturers such as BMW, Volkswagen and Renault to propose that the EU change the rules. The EU has promised that the entire 2035 timetable will be revised in 2026. Meanwhile, Renault has asked the EU to launch the equivalent of the Marshall Plan, the US’s massive aid program to Europe after World War II, to rescue European carmakers from the crisis. consequences of its own regulations.

Mazda MX-30 R-EV

17.8 kWh lithium-ion battery

830cc rotary engine

I-speed automatic

0-100 km/h 8.9 seconds

Top speed 87 km/h

Miles per US gallon 339.3 (claimed)

Battery range 53 miles (claimed) + 350 miles ICE supported

CO2 – 21g/km

Price – from £31,250 after tax ($39,000)

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