Say What? Oil Companies Admit EV Boom Is Coming

7 months ago by Steven Loveday 30

EV

The Tesla Model S, the first long-range electric car to be competitive on price in the luxury market, is currently the top-selling luxury large sedan in the U.S.

One of the world’s top oil producers says that EVs may make up about one-third of automotive market share by the close of the next decade.

Total SA’s top energy analyst, Joel Couse, is more bullish than most when it comes to EV adoption forecasts (especially compared to those with ties to the oil industry). At the recent Bloomberg New Energy Finance conference in New York, he said that EVs will comprise 15 to 30 percent of the new vehicle market by 2030. Couse went even further to admit that fuel demand:

“Will flatten out … Maybe even decline.”

EV

The Chevy Bolt is the first affordable mass-marketed long-range all-electric vehicle.

Others in the oil industry have dialed back predictions as of late. Last month, Royal Dutch Shell Plc Chief Executive Officer Ben van Beurden said that oil demand will peak in the late 2020s. According to Couse, the peak will happen in the 2030s. Colin McKerracher, Bloomberg New Energy Finance’s head of advanced transport analysis, said that Total SA’s projections are the highest yet by a top oil company. He admitted:

“That’s big. That’s by far the most aggressive we’ve seen by any of the majors.”

Battery prices are dropping around 20 percent each year, and more and more automakers are investing substantial capital towards electrification. Due to the simplicity of an EV, about half of its cost is related to the battery itself. As battery prices continue to fall, the expense of an EV will no longer be a deterrent. Add the continual development of charging infrastructure over the course of the next decade or so, and the limiting factors of EVs will virtually disappear.

Several automakers have electrified models coming to market in the near future. By 2020, a majority of global carmakers, including Volkswagen, Audi, Jaguar, Mercedes-Benz, BMW, and General Motors, among others, will continue adding new models.

Founder of Bloomberg New Energy Finance, Michael Liebreich, concluded:

“By 2020 there will be over 120 different models of EV across the spectrum. These are great cars. They will make the internal combustion equivalent look old fashioned.”

Source: Bloomberg

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30 responses to "Say What? Oil Companies Admit EV Boom Is Coming"

  1. Big Solar says:

    you can only deny reality for so long if you want to live in it

    1. mx says:

      Don’t get your hopes up.
      That makes BP and Total. No US Oil Company has admitted realty yet. Zero investments in wind or solar.
      So, watch for a US Oil Stock Price Crash Soon, in a year or two.
      Esp. with big advances in Solar Cell Efficiency kick in.

      After they lose 50% of their stock value, then you may see CEO firings and new management working on a plan for survival.

      1. TM says:

        solar has no impact on oil consumption. Oil produces a very small share of electricity

        1. anon says:

          It’s tightly related even though we don’t use oil for electricity.

          1. These companies produce oil & gas. You drill a well, you might get oil, gas, both, none.
          2. Gas is used for electricity, so at best, oil & gas companies may be thinking increased electricity demand from EVs may cushion the blow (they’re wrong, though).
          3. Solar is used for electricity and many EV owners also install solar panels.

          So this means the shift to EVs also correlates to a shift to wind and solar.

          1. Mister G says:

            Very well stated.

    2. SparkEV says:

      Until about 2014, EVs were not that compelling, all of them lagging their gas car counterparts. But with Tesla’s insane mode followed by ludicrous mode and SparkEV, all of which dominate gas cars of similar price and form, it was a game changer. EVs were no longer expensive turtles.

      There was also the question if DCFC would actually work long term with Nissan advising people to use only one DCFC session per day, which translate to about 150 miles range even if you had nationwide charging network. Then SparkEV with correctly implemented battery came with DCFC rate of 2.6C (20 minute to 80%), and someone actually driving 650 miles a day (16 hours) in late 2016.

      Now we have Tesla coming with Tesla 3 and GM release of Bolt along with many other MFR with 200+ miles range EV coming. There were doubts before 2015, some doubt even in 2016, but there’s no more doubt in 2017.

      1. Brian says:

        No offense to your personal favorite EV, but the Spark EV had nothing to do with changing anyone’s mind. Excepting the fact that some of its spirit lives on in the Bolt. Unfortunately, the Bolt is far more conservative with its DCFC rates.

        1. SparkEV says:

          For general public, SparkEV didn’t do much; you can see from sales. But from executive point of view, viable DCFC (80% in 20 minutes, 2.6C) even on cheap EV that kicks butt from legacy auto maker would take notice at a time when Leaf was suffering bad publicity of battery degradation.

          If you’re an “oil guy”, you care about charging speed, and SparkEV was (is?) the quickest charging EV. If other EV can have such quick charging with inevitable longer range, you see the writing on the wall. At least smart ones would’ve noticed SparkEV. In 2017, it’s plenty obvious to almost everyone.

      2. przemo_li says:

        I think SparkEV got batteries from hybrids, those have high C but everything else is inferior to batteries designed for EVs…. but it was good choice for SparkEV.

        Just do not expect anybody to put 60kWh of those in a single car. 😉

  2. Earl Richards says:

    To avoid the Big Oil/Texas gasoline price rip-off, plug your Tesla electric car into your household, solar array.

    1. Aaron says:

      To avoid sending your money overseas and funding terrorism, plug your EV into your household solar array. 🙂

      1. Lambo says:

        Not so fast you two. Our economy depends on the international strength of the US dollar. That strength comes from backing by oil. We cannot just abandon oil without unintended consequences.

        1. Mister G says:

          Lambo, oil will not be abandoned even if EV’s reach 90% market share, humans will always have a use for oil in plastic products, lubrication, agriculture, space exploration, construction etc… do not panic lol

          1. arne-nl says:

            Another form of denial 😉

            That is just a small part of oil use, never enough to replace demand destruction from a shift to electric transport. A minor change in supply demand has a huge effect on price.

          2. Lambo says:

            Thanks Mr. G – I feel much more calm now. As oil is displaced as a form of energy, it will have a profound impact on the US dollar as industrialized nations import significantly less oil. There are many positives associated with this, but one huge negative if you live in the United States. The system that guarantees huge trade imbalances with the rest of the world that support the (high) American standard of living will disappear. It’s not going to be pretty. Just sayin’.

  3. Kdawg says:

    1/3 of market share is not the same as 1/3 of vehicles in operation.

    Even so, I hope it happens.

    1. TM says:

      Yes, total EVs on the road at that time will only be ~10%. While 30% of new cars sold is a good trend, it would take another 10 yrs at that rate to bring the total number of EV cars on the road to the 30% level.

  4. Steve says:

    15-30% of new cars will be electric by 2030? That seems low. With EV prices coming down, electric ranges getting longer, charging getting faster — I think that several years before 2030 we’ll be at the tipping point where gas cars don’t make sense to the consumer. When that happens, sales of gas cars will diminish quickly.

    I think (and hope) that by 2030 more than 50% of new cars will be electric.

    1. Loboc says:

      Several futurists put the EV tipping point at 2025. (Kurzweil, Seba, Musk)

      That’s only 8 years.

      1. mx says:

        Solar Cell efficiency jump will also tip the scales. Fracking is already more expensive then current wind and solar operations.

        Make a bigger marginal difference with advances in efficiency and the nails in the coffin will be more rapid.

      2. Kdawg says:

        Maybe in Europe but not in the US. Over 50% of vehicles are trucks, and we don’t any EV trucks on the horizon that will be available to consumers in mass, in just 8 years.

        1. arne-nl says:

          Why so confident that no trucks will be available in 8 years? The technology is the same as for normal cars, just a bit bigger.

      3. Steve says:

        Yeah, 2025 sounds about right to me. And I think the tipping point will include electric versions of the large SUV and pickups that Americans like. I think that by 2025 EVs will be growing market share very quickly, but won’t be dominant yet. For a while, I think the main constraint will be the limits of what they can manufacture. It takes a long time to ramp up production, and those battery factories take a long time to build.

  5. F150 Brian says:

    If 1/3 of the global auto market is EV in 2030 and historical grow rates continue, there will be the *same or more* petroleum fueled (non-EV) vehicles being sold in 2030 as there is today.

    And the “in service” market share for EVs will be single digit percent.

    The total removal of dino burning vehicles will take a very long time.

    1. Loboc says:

      “The total removal of dino burning vehicles will take a very long time.”

      Dino fuel can be replaced by bio-fuels. As dino fuel becomes more expensive to extract, bio-fuel will become financially viable.

      It’s not like EV is the only alternative.

      1. arne-nl says:

        Biofuels? Haha.

      2. Lambo says:

        Biofuels have a lousy return on energy invested. They are simply not competitive with fossil fuels.

  6. Dutch says:

    I own an ICE powered vehicle, I also own an EV. In terms of daily commuting there is simply no comparison between the two. The yearly savings on maintenance and the pleasure of driving a smooth and quiet EV puts it light years ahead. The only reason I hang on to the ICE is for towing a trailer.

    1. DL says:

      +100.

      I wish my spark EV were more comfy though, but in all other respects there’s no comparison. No service, no oil changes, zero problems. Battery degradation of the 2014 (A123) battery seems to be faster than I hoped though, already at 16kw usable. But that will carry me over to Model 3. Fuel, toll HOV, service savings basically are equal to the car cost in 5 years. Seeking to replace my Highlander Hybrid with Pacifica PHEV now, although this is still not the vehicle i’d be ultimately looking for in that segment, but it hopefully will similarly bridge the gap to a pure EV in that segment too.

      The barrier for renters is more significant though. I don’t see majority of residences being equipped with 240V outlets in a garage or on parking as standard in next 10 years. That means overnight L2 charging (even with a personally owned plugin charger) remains a scarce guarantee from a renting person’s point of view.

      Relying just on fast chargers is still not where it would be ok even with 50kw. The DC charging prices are comparable or even more than gas now (EVGO, yes I mean you). Tesla’s superchargers are simply not something you’d stop by on your way to work (as it stands, they are not nearly as ubiquitous along the freeways as the gas stations are, and probably will unlikely be any time soon).

      As long as EVs are conditioned on overnight L2 charging which is in turn pretty much conditioned on home ownership, the market penetration would remain subdued. Home ownership + Solar/storage + 1 or 2 EVs is still a sticker too steep for most in the bay.

      What would be needed to change the situation for more mobile part of population perhaps are widespread 150+ kw chargers with at least gas-comparable energy prices.

      But I definitely rally for the “futurists'” estimates for adoption.

  7. Bloggin says:

    The recent talk is about automakers increasing octane requirements for the new cleaner engines, which will increase gas prices by .25 to .50 cents based on current pricing.

    But that’s going to be higher than most think. Currently regular is 2.04 and premium is 2.49. The new fuel is a Super Premium which should push the price another .45 cents to 2.94. That’s a jump of close to a dollar. But we all know there is a wide profit margin with fuel pricing, and oil companies know that their last price hike, gave EVs a big boost.

    So it will be interesting to see how the oil companies play this one out. Cut their profits to hold on to gasoline customers, or maintain current profit margins, and send more consumers to EVs and away from gasoline forever.

    For me…next car is definitely going to be a full EV. I just need something to get me out of my 3-series. Model 3 could be it.