Jealousy, fireworks and how Norway became an EV success
Latest news from the billion-million-trillion-dollar world of EV. The Fast Charge #2
Hello and welcome back to The Fast Charge, a newsletter that will plug you into the latest in electric motoring. My name is Tom Riley and I’ll be your host.
Writing today’s email felt a bit like doing accountancy. Lots of imposing numbers many of which I couldn’t always get my head around. A million this, a billion that. Electric motoring does seem to be the hot ticket for anyone with two coins spare right now. And nobody knows that better than Elon Musk, who yesterday became the world’s richest person.
Elsewhere in today’s edition, I decided to do some research into the recent success that Norway has had introducing pure electric cars - sales now outstrip every other type of car. It’s a herculean achievement which I think we can learn from in more ways than just ‘tax cuts work’.
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In the news…
KIA BOMBS: Ahead of launching a new EV on 15 January, the South Korean car manufacturer, Kia, has revamped its logo in a ploy to show it’s modern. The unveiling was done via the use of over 300 drones which were also fitted with fireworks. The video of it is quite mesmerising and apparently has taken the Guinness World Record for the most unmanned aerial vehicles launching fireworks simultaneously. According to Kia, their new logo is an unbroken line which signifies “confidence” for the new era of motoring. Their new slogan is ‘movement that inspires’. Interestingly, if you turn the new logo upside down it seems to say ‘Na’. Watch the unveiling below.
FUEL FOR THE FIRE: A survey just before Christmas has revealed that eight in ten British motorists want fuel duty frozen at the very least in the upcoming Budget. Meanwhile, 21% would like it axed altogether. Fuel Duty in the UK has been a political hot potato for decades. It’s one of the highest rates in Europe and that’s despite a freeze on it since 2011. The lobby group Fair Fuel UK conducted the survey with 30,000 motorists. They are worried about a possible increase as the Treasury looks to cover its mountain of Covid related debt. I doubt it will increase just yet, but surely with the UK’s surge towards EVs, a rise will come soon. Read more here.
GOING DOWNHILL: Figures released this week by the UK’s Society of Motor Manufacturers and Traders (SMMT) showed new car sales in Britain fell by close to 30% to 1.63m during 2020. That’s the biggest annual fall since 1943 - that’s further away in history than D-Day. One in 10 cars sold last year was a plug-in vehicle - more pure electrics were sold than hybrid plug-ins. The SMMT has said the UK needs significant more investment into charging infrastructure and battery factories in order to be ready for the internal combustion engine ban in 2030.
ON THE UPSIDE: Germany seems to be doing pretty well for electric car sales. Last year the automative powerhouse tripled the number it sold - a total of 194,000. However, when you look at the fine detail, that is only a growth in market share from 0.5% in 2019 to 1.2% in 2020. Still a long way to go.
MONEY BAGS: As Tesla stocks have continued to surge so too has Elon Musk’s net worth - he’s now the richest person on Earth. It follows the recent news that Tesla had sold nearly 500,000 vehicles despite the pandemic and that it could be producing millions easily in the years to come. He’s now valued at $190 billion - just above Jeff Bezos who is worth about $184 billion. This probably won’t phase Jeff too much though. He apparently does not like the stock market and allegedly tells staff regularly it’s ‘not the company’. Elon too greeted the news on Twitter by saying ‘How strange… Well, back to work.’
TRUCKS AWAY: The electric pickup truck startup Rivian is now valued at a whopping $25 billion thanks to new investment this week. Seeing as it launched only in 2018 that’s a huge achievement. Previous investors have included Amazon and Ford, so one can assume it’s destined for greatness. Rivian’s pickup model (called the R1T) could be incredibly popular in the USA where trucks are a way of life. But, likewise, not just catering to red-necks, Rivian’s R1S model is utterly gorgeous (image below). It looks like the sexier twin of a Land Rover Discovery 4. In the interim, before they become mainstream, Rivian is developing a fleet of 100,000 battery-powered delivery vans for Amazon.
JEALOUS MOTORS: In a keynote speech this week, Chief Executive of General Motors, Mary Barra, unveiled their plan to develop 30 EV models, invest some $27 billion into developing them and plan to sell 1 million in 2025. According to the Financial Times, Ms Barra didn’t reference Tesla directly but it was clear they are desperate to retake the top position selling EVs from them. However, analysts doubt they could seeing as GM also need to keep their main non-EV business going. Adam Jonas of Morgan Stanley puts it like this: “It’s like you’re operating on yourself...It’s possible. It’s just the added challenge.”
How Norway electrified motorists
This week Norway was revealed to have become the first country in the world to sell more electric cars than those with diesel, hybrid or petrol engines. It’s a phenomenal achievement, especially as only 10 years ago just 1% of Norway’s car sales were electric - now 54%.
On Norway’s current trajectory, by 2025 Norway they will probably become the first 100% electric nation.
That’s great news for polar bears, but how can every other country replicate the success?
The majority of people put the insurrection of electrics in Norway down to the generous tax cuts. Like many other nations are already doing, successive Norweigian governments have voted to ensure there are financial incentives to going green.
Electric vehicles bought in Norway do not pay taxes or VAT. This cuts a huge amount off the price. There is also no annual road tax, making running costs cheaper. These policies combined with an impressive public charging infrastructure have enabled motorists to more easily make the switch.
Most other countries are following this approach and also offering lucrative grants. In the UK alone you can get up to £350 for a home charging point and £3,000 when buying a car.
However, there is another fairly underrated policy that Norway employed during its EVolution.
Between 1999 and 2017 it was totally free for owners of electric vehicles to use most car parks in towns and cities. Whereas the dirty fossil-fueled car owners were driven out of city centres, the greenies were allowed in.
In many ways, it made perfect sense. Most charging stations are in towns after all, and it would be unfair to charge someone three hours of extortionate parking just to keep their car moving
Norway ensured free parking wasn’t just done in isolation. At the same time, they also exempted EVs from having to pay to use ferries. And that’s a big deal in the seafaring nation - ferries are regularly part of car journeys in Norway.
And they didn’t stop there too. EVs were also exempted from paying toll roads. That was a real money saver for Norweigian motorists as there are some 330 of them in operation. By comparison, in the UK there are only 23.
These policies became so popular that as electrics really started to grow in Norway it became financially untenable to continue. So, since 2017, they introduced a 50% rule. This means local districts in Norway can charge electric motorists for using their services if they want to. But, only to a maximum of 50% that fossil-fuel cars are charged.
Other countries haven’t adopted these more indirect policies into the mainstream yet but authorities are cottoning onto their success.
For example, in London, 11 boroughs have started offering free parking permits to electric car owners while 15 offer discounted prices. Although, 6 boroughs still offer no benefit at all.
The UK and many others are still very much in their infancy of electric vehicles, but surely these simple changes from central governments could actually be more effective than just splurging on grant money.
Yes, at some stage they would have to be tapered - as Norway has done - however, there could be added benefits outside just getting more people buying electrics. One that comes to my mind relates to the free parking in towns.
In the UK, our high-streets have been struggling for a great many years. People now shop online rather than visit the shops physically. And why? Well, Covid at the moment. But mostly because of accessibility and ease in normal times.
Perhaps by making it easier again for people to ‘pop to the shops’ without incurring huge parking charges, maybe we’ll see a return of communities visiting the centre of towns - rather than the huge warehouses and malls outside them.
As a famous Norweigian proverb says: little strokes fell great oaks.
By Tom Riley