The dream of climate advocates for a rapid transition to fully electric vehicles (EVs) in the U.S. faces significant challenges, as highlighted by Ted Nordhaus in his essay, “Could Climate Hawks Dream of Hybrid Vehicles? A Course Correction Will Likely Be Needed As EV Sales Flag.” While environmentalists and policymakers have placed high hopes on EVs to curb greenhouse gas emissions, Nordhaus argues that a more balanced approach involving hybrid vehicles might be more realistic in the short term, given the current EV market realities.
In early 2023, Nordhaus co-authored an essay in The Wall Street Journal predicting that mass adoption of EVs in the U.S. would not happen anytime soon. He and his co-author, Ashley Nunes, criticized the overly optimistic projections from the Biden Administration and climate advocates regarding EV sales growth. The assumptions behind the Environmental Protection Agency’s (EPA) emission standards, which aimed to push automakers toward a mostly electric fleet, have proven to be overly ambitious. A year and a half later, EV sales in the U.S. have stagnated at around 7% of total new vehicle sales, despite federal incentives and price cuts by automakers.
Nordhaus identifies several reasons for this stalled growth. American car buyers value performance, affordability, and convenience, and the current EVs on the market struggle to meet these criteria. The decentralized nature of U.S. cities, where car dependency is high and long-distance travel is often necessary, creates range anxiety for potential EV buyers. This, combined with the high upfront costs and inadequate charging infrastructure, has limited the appeal of EVs to a niche market, primarily wealthy and liberal consumers.
The financial challenges for automakers are equally daunting. Producing large, long-range EVs that meet American preferences requires expensive, large batteries, which reduce profitability. Despite efforts to bring down battery costs, it remains unclear whether EVs can be produced affordably enough for mass-market appeal in the near future. Additionally, public support for EVs has declined, with a growing number of Americans opposed to electric vehicle mandates and subsidies.
Given these challenges, Nordhaus suggests that a pivot toward hybrid vehicles—those that combine a gas engine with an electric drivetrain—might offer a more viable path forward. Hybrid vehicles could leverage existing EV technology, while overcoming the range and cost issues that currently plague fully electric vehicles. By requiring smaller batteries, hybrids could reduce dependency on the critical minerals needed for battery production and allow automakers to meet consumer demands at a lower price point.
In conclusion, Nordhaus argues that while fully electric vehicles may dominate in the long term, the near-term future likely belongs to hybrid vehicles. This pivot would allow automakers to utilize their investments in EV infrastructure, while avoiding the pitfalls of over-reliance on batteries and charging networks that are not yet ready for mass adoption. As public interest in EVs wanes and political opposition grows, a shift to hybrid vehicles may be the most practical course correction for the transportation industry’s decarbonization efforts.
Note: Evolution of batteries will be essential for the growth of EVs. Watch for a report on batteries coming up.
