Wont be able to lease or finance an electric car?
A problem I see in the next decade period is that the rapidly falling cost of batteries will feed into a constantly falling cost of electric cars. Once the battery has fallen in cost so far that it becomes a small part of the overall cost that will no longer be an issue, but it will be in the now to 2030 time period.
The falling cost will of course destroy the resale value of ICE cars (causing major issues for car financing and leasing companies, as well as individuals who borrowed to buy a car), but will also lead to the rapid depreciation of previously-sold new electric cars. The result will be much greater levels of assumed deprecation, which will lead to higher lease payments and shorter loan maturities. It will also cause problems for car rental and other car fleet companies.
Again, as the cars get cheaper and stabilize in price (as the battery cost becomes less and less a share of the overall cost) this will not be an issue. But in the interim, up to maybe 2030, it may act to hold back a transition. The result may be a significant drop in car sales until the issue works itself out, causing big problems for car manufacturers (in addition to the destruction in the value of their current assets).
True, and all the more so as battery technology is not mature yet. We might see disruptive technological changes to battery tech, e.g. solid-state batteries. However, there might be remedies. The central issue here, it seems to me, is
who will carry the risk? Why should the risk be put entirely on the consumer side? Car producers might just as well share the risk with consumers.
Once the battery car becomes evidently cheaper to buy and own than the ICE, consumers will anyway not want the ICE. They will go for the EV.
Consumers will want to be protected from quick deterioration of used car value. The one item causing problems with this, is the battery. Solution:
EV car producers offer a car where:
1. the battery is easy to swap
2. consumers lease the battery
3. there are clauses giving rights to consumers to cancel battery agreements, fixed repurchase values of batteries.
Don't worry, rboyd, the Big Money is right now moving into EV, and all that big $ and many clever people will find solutions that mitigate consumers' worries.
Also, these kind of technologically driven fast depreciations haven't scared consumers away from buying IT (smartphones, computers etc.) We still want to have the latest tech, the best tech, very well knowing it will quickly depreciate in value. True, a car is more costly, but it is also a cool gadget for many people.