Supercharged: Car Manufacturers Set Ambitious EV Targets

Supercharged: Car Manufacturers Set Ambitious EV Targets​

The Story

This week, multiple car companies set out significant and meaningful electric vehicle goals. Jaguar Land Rover (JLR) committed to ditching the combustion engine within 15 years, with the brand becoming electric-only by 2025. Ford intends to stop selling traditional cars in the UK and Europe by 2030, with every model having an electric/hybrid option by 2026. Contrastingly, Daimler, the parent company behind Mercedes, stated they would not stop selling combustion-engine vehicles prematurely, and committed only to an electric fleet of Mercedes by 2039.

What It Means For Businesses and Law Firms

These comments from car companies follow the recent announcement by the UK government that they will cease the sale of purely fossil fuel-powered cars by 2030. This comes as countries, governments, and companies around the world look to meet the 2050 goal of slowing global warming, as set out in the Paris Agreement 2015.

JLR has historically been known for its powerful and luxurious cars such as the Land Rover or Jaguar models. The company’s commitment to electrify its fleet means the core UK plants will remain open, but some will be repurposed to meet the needs of electrification. The company has set itself the target of producing the first fully electric Land Rover by 2024, and hopes for 60% of sales to be fully electric by 2030.

JLR’s pre-tax profit for Q4 2020 was £439 million, up 40% compared to Q4 2019. The majority of these sales did not include electric engines, as the company faced approximately £60 million in fines across Europe, the US and China for missing its targets to reduce emissions (Financial Times). As such, the British brand has committed to spending £2.5 billion on electric technology and connectivity.

Ford has followed a similar path, deciding to repurpose some of its plants for electrification, including its current diesel engine plant in Dagenham. The company may be slightly ahead of JLR in its progress, with 10% of its sales in Europe and America in 2020 comprising of electric cars. The company is investing US$22 billion in electric technology by 2025, including a deal to share technology with fellow German car company Volkswagen.

Daimler has taken a different stance, as the company believes that combustion engines are a “cash machine” to fund future electric technology (Financial Times). The company believes that it is virtually impossible to predict the car market in 2030 and seems unlikely to stop selling combustion engines whilst it is generating a profit - net profit for 2020 was €4 billion. Of the 2.5 million vehicles sold in 2020, only 2% of these had electric components.

Although the views of these companies may differ, all three, as well as many other commentators, agree on the need to improve electric connectivity and technology to make their goals a reality. Without accessible charging stations, a nationwide network, and greater engine driving range, these targets may only ever be a lofty pipe dream.

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