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Are Electric Cars Actually the Future?

by Index Investing News
October 25, 2022
in Opinion
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Editor’s note: In this Future View, students discuss electric cars. Next week we’ll ask, “

Microsoft

has reported that the average human attention span has dropped to 8 seconds from 12. What has caused the drop? Should we be trying to have longer attention spans for concentrating on tasks? Or should we be adjusting to receiving information more quickly?” Students should click here to submit opinions of fewer than 250 words before Nov. 1. The best responses will be published that night. Click here to submit a video to our Future View Snapchat show.

Electric cars are only one variable in the equation. According to the U.S. Energy Information Administration, as of 2021, fossil fuels fed 60% of the U.S. power grid. Meanwhile, American infrastructure has not been adequately updated in decades, making it extremely vulnerable to weather damage and cyber attacks. This power system is the primary source for electric-vehicle manufacturing and charging—which means that even though electric cars are not gasoline-powered, they are still created and charged by inefficient, insecure and unrenewable sources of energy.

Record investments by the Saudi Royal Investment Fund and China’s Communist Party in electric vehicles reflect an increasing competition and trend in the global markets toward electric vehicles. Around 55% of China’s energy continues to rely on coal, while Saudi Arabia’s is around 60% reliant on fossil fuels. Neither of these nations is concerned about the environmental impact of electric vehicles. Their investment is a matter of competing with the U.S.

American leaders need to understand that the battle between being a climate leader and competing in global markets is not a binary choice. By investing in new infrastructure and fully embracing renewable energies we will be less reliant on foreign nations and less vulnerable to weather and cyber attacks, while providing the foundations to maintain American economic hegemony.

—Andrew Lymm, London School of Economics and Political Science, international relations

The Enthusiasm Is Everywhere

Most people will have heard of California’s ban on sales of gasoline-powered cars by 2035. Auto makers themselves are making equally sweeping promises: GM touts a “path to an all-electric future” with its own proclamation of ending production of gasoline vehicles by 2035. Mercedes announces the same, but with a target year of 2025.

Honda

already has gotten rid of the nonhybrid version of its Civic in Europe. And in the financial markets,

Tesla,

an all-electric company from the start, had at one point a stock valuation that was greater than its top five carmaker rivals combined.

A lot of this is hype and hot air. But taken together, it signals confidence and agreement among auto makers, governments and citizens about the promise of a future of all-electric transportation. California’s commitment to ban gasoline-powered vehicles is not an adversarial regulation to coerce companies. It is rather one more contribution to what is now an undeniable tsunami of enthusiasm for the electric future.

—Simon Alford, Cornell University, computer science

Who Wants Cars Anyway?

Cars should not be the future. Our system of roads and private vehicles is not sustainable, no matter how efficiently we fuel our cars. Electric cars may be a step toward sustainability, but at a certain point we must accept that cars are an antiquated means of transportation.

Cars need to be replaced with robust public transportation. Buses, trains and trolleys take up less space and are cheaper and more efficient, not to mention safer, than cars. Subway trains don’t spend the majority of time parked in driveways. They are always moving and benefiting the general public.

Without cars (and the parking lots they require), we could have greater density of businesses, housing and parks. The type of transportation best for the environment is human-powered walking, and that type of transport is not possible while we remain dependent on cars.

—Sam Walhout, Brown University, economics

Batteries Are Catching Up to Gasoline

It might seem strange to an alien that we use costly equipment, designed by some of the sharpest engineers on earth, to extract jet-black sludge from below the earth’s surface—only then to refine it and explode it in a tank on wheels to get from point A to point B.

That’s only half the story, of course. While electric cars are often marketed as fully green, they aren’t. The driver is just trading burning a petroleum product for burning coal or obliterating plutonium atoms somewhere far away to make electricity.

Electric vehicles are becoming popular because our engineers have finally created a battery that can store energy almost as efficiently as million-year-old dead plants can. And by 2035 it’s reasonable to expect this battery technology will even be superior to gasoline, which would make electric cars the financially obvious choice to the ordinary Californian.

—Walker Bigelow, University of Wisconsin, finance and data science

We Need More Advances in Technology

Decreasing the number of gasoline-powered vehicles is important for slowing climate change, but the technological change will also require incorporating more alternative fuel sources. Despite the cost of electric vehicles dropping significantly in recent years, entry-level models for Chevrolet, Hyundai and

Nissan

hover around $30,000 to $40,000, where cheaper gas-powered cars can be purchased for around $20,000.

Even more significant are the prices of the materials used to make the batteries for these electric cars. Many of these batteries rely on lithium, cobalt and nickel—metals that need to be mined, often with damage to the ecosystems and the economies of the developing countries in which they are found.

Electric vehicles will occupy an important place in a world moving on from fossil fuels. More technological advances, however, need to be made before the electric car marks a major advance in green transportation.

—Carlie Hanlon, St. George’s University, medicine

Click here to submit a response to next week’s Future View.

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8



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