Transitioning to the electric vehicle: A complex map of problems, a number of issues to correct and a great opportunity

By 2035, combustion-engine vehicles will no longer be sold in Europe. To decarbonise this sector it will be essential to make the transition to sustainable mobility easier, this includes electric mobility. There a number of different challenges facing the electrification of the car fleet. The process could be speeded by breaking down the following two barriers: The price of both electric vehicles and the charging infrastructure.

By Óscar Pulido

Vehículos eléctricos zona de recarga

It is always difficult to revolutionise a consolidated system and to change an established concept is always a difficult task. What does not change is that the future of a company, an industry in the country or even the future of the planet may well depend on it. The transition to the zero-emission vehicle  is one of these, and it is happening right before our eyes. In this case, there is already a defined time frame, given that the commission approved stopping the sale of combustion-engine vehicles starting in 2035. Now we need to ask the following question: How can this challenge be met?

 

How can the implementation of the electric vehicle be accelerated?

What we first need to understand is the root of the different problems faced with regard to the electrification of the fleet of vehicles, since these problems have to be dismantled as if they were matrioshkas (Russian dolls). We have to understand that many of them are intertwined, and just as if it was complex machinery, all the parts have to move correctly if progress is to be made in this process.

Having said that we should focus on the two main barriers that exist today, and if they could be overcome it would considerably accelerate this transition: The price of electric vehicles and the charging infrastructure.

 

The key to the price: Updating taxation

Until more affordable options appear on the market, electric cars still require the buyer to make a significantly higher initial outlay compared to combustion-engine vehicles. It is true that this is easier for people in countries with higher incomes; even so, if we look at our Portuguese neighbours, where GDP is lower, we can see that the percentage of electric vehicle registrations is double that of Spain.

The key lies in taxation, and it can clearly be shown how this can condition the market. Many of the measures implemented there are designed for corporate fleets, since companies have enough financial strength to be able to make the initial payment. As the total cost of ownership favours the electric vehicle and there are tax advantages for those who choose that option, it is not surprising that more and more Portuguese companies are opting for zero-emission cars.

Furthermore, company vehicles remain with their first user for an average of barely 4 years, after which they end up in the second-hand market, where they can be purchased at a lower price. This means that a high proportion of the population are given the possibility of acquiring a zero-emission vehicle.

Unfortunately, Spain has obsolete tax regulations which in many cases do not reward in any way the choice of a less polluting vehicle, nor do they penalise the opposite. To give an example, the regulations governing the registration tax and the emission values that define the corresponding amount date back to 2007. In other words, that regulation is 16 years old, more or less the average age of vehicles in Spain. So, we should not expect a modern car fleet without taxation in keeping with the times.

 

A commitment to the development of charging infrastructure starting with the regulations

But we should be honest with ourselves: Nobody will be looking forward to spending their money on something that will be a problem when it comes to using it. This brings us to the second point: The recharging infrastructure. Everyone will agree that it is more comfortable to drive an electric vehicle than a combustion-engine vehicle; however, the general comfort of using these vehicles currently depends on the availability of charging stations in the area (or along the route) where you are going to drive.

Just a few weeks ago, the European Regulation for Alternative Fuels Infrastructure (AFIR) was approved, which together with the recent measures approved by the Government aimed at speeding up the process of deploying charging stations, will undoubtedly represent progress in the development of infrastructure.

But it would be a mistake to think that this solves all the problems. What is currently needed is a national plan (similar to what has been done in Germany) to meet this challenge, also taking into account the demographic situation, the extension and the orography of Spain.

And not least: There should be no stagnation once legislation or regulations have been approved, since it is equally important for them to be implemented.

Vehículo eléctrico

An opportunity for Spain: Its industrial expertise and potential for renewables

However, I do not want to focus only on the negative aspects. This change will also make room for a number of opportunities. Spain is currently the second largest manufacturer of cars in Europe, and although this does not guarantee anything, it does provide the competitive advantage of experience, a key factor when establishing where new models are to be produced and the industry surrounding the electric car. This translates directly into jobs: Manufacturing, installing and maintaining chargers, manufacturing and processing batteries, etc, etc, etc.

All this, together with Spain's potential with regard to renewable energies, makes us think that there is much to gain. There is no doubt that Spain could be positioned as a leader in electric mobility. But it should be borne in mind that there are more and more players involved, more candidates to take a slice of the cake.

I would like to end, just as I began, by saying that sometimes changes that are brought about may define the future of a company or a country. But this transformation needs to be consummated, because plans and promises alone are just not enough. We really have to take a step forward, because if not, one day we will wake up and realise that it is already too late.

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