And if oil prices remain below $50 a barrel, it again changes the outlook for rapid adoption of electric vehicles. Even BNEF says oil trading in the $20s for a long period of time would push their scenario back by about a decade.
The question about government subsidies for electric vehicles remains too. Even “green” Germany is quibbling about the amount of incentives to give for buying electric cars. And most governments will be phasing out incentives for electric vehicles around 2020.
By then, the cost of buying an electric vehicle will have to be below the average cost of a regular car. Or else, again Bloomberg’s sunny scenario may fall by the wayside. And as I stated earlier, much of that lower cost may end up relying on batteries. That in turn will rely on Tesla’s lithium-ion Gigafactory and whether it can crank out batteries efficiently and cheaply.
I hope BNEF is right. It stated in the report, “The electric vehicle revolution could turn out to be more dramatic than governments and oil companies have yet realized.” My fingers are crossed.
This article is brought to you courtesy of Tony Daltorio from Wyatt Investment Research.