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Global automakers are ramping up investment in hybrid technologies as growing customer distrust of all-electric cars forces them to shift gears quickly, according to senior executives.
The combination of persistently high interest rates and considerations about inadequate charging infrastructure has dampened buyers’ enthusiasm for all-electric cars, sparking a rebound in hybrid car sales that most of the industry has long regarded as nothing more than a stopgap resort.
Seizing the resurgence of demand for hybrids as a priority, executives from General Motors, Nissan, Hyundai, Volkswagen and Ford said this week at the Financial Times summit on the long-term automotive industry.
“We want to invest heavily in the long term of plug-in hybrids,” said Mark Reuss, president of General Motors. “We have to be agile. We have a set of technical teams that we can implement quickly.
This view was echoed by Jose Munoz, Hyundai’s global president, who is now contemplating making hybrids at its new $7. 6 billion plant in Georgia, as more and more drivers are hesitant to buy all-electric vehicles.
“If you had asked me six months ago, a year ago, I would have answered . . . completely electric,” Muñoz said. A lot has happened since then until now. Electricity is still the future. But now we are witnessing a longer transition.
Growth in electric car sales slowed in the U. S. and Europe last year, prompting automakers to offer discounts. Industry leaders have already stated that the market has lost some of its momentum, as long-term sales expansion increasingly depends on demand from classic buyers. than the early adopters.
At the same time, there are fears that governments will oppose his previous plans to force a transition away from gasoline-powered cars.
Ford’s European chief, Martin Sander, said the speed of the transition in Europe depends “on the consumer” and that the U. S. organization is in a position to continue promoting hybrid models over the next decade.
“We need to make sure that we set up our business style in a way that is flexible enough” to cope with adjustments in demand, Sander said at the summit. “All of our business plans and lifecycle are now much more dynamic. “
U. S. rival General Motors, which had largely eliminated plug-in hybrids from its range, announced in January that it would reintroduce the technology.
The growing customer hesitancy comes at the same time that automakers face a growing risk that Chinese makers will introduce less expensive electric cars in their home market and, increasingly, in Europe.
To remain competitive in China, Peugeot will have to remain “nimble” so as not to be dragged into the country’s value war, Chief Executive Linda Jackson said. “We’re holding on, but the Chinese market is the biggest car market in the world. “world, so it’s very difficult for a global automaker not to be there,” Jackson said.
According to Schmidt Automotive Research, Chinese brands such as BYD and those like Polestar that manufacture in China accounted for about 10% of all-electric cars registered in Western Europe in March, up from just over four in two years. behind.
“We’re seeing a bigger festival of Chinese brands and the tech world,” Nissan Chief Executive Makoto Uchida said at the summit.
The risk of Chinese corporations is only due to automakers’ increased interest in hybrid vehicles, which typically boast double-digit margins over loss-making all-electric vehicles.
For many automakers, this slowness will allow them to continue to profit from classic engines while also offering more monetary leverage to expand EV technology.
The majority of the industry remains convinced that progression to fully electric, cost-effective cars is the ultimate long-term goal.
Earlier this week, Toyota, the biggest hybrid champion in recent years, said it plans to increase spending on new-generation by more than 40% after hybrid sales pushed the group’s profits to a record high last year.
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