The relevant question is how long can legacy car makers afford to make two very different kinds of cars. Having to support both ICEs and EVs seems inefficient and noncompetitive compared to companies focused on one or the other.
That’s a good point. We may indeed see some legacy automakers spin off their ICE divisions into separate companies - or even rebrand them - if it becomes inefficient to house them both in the same company. Maybe not, though - modern corporations can sometimes house disparate product lines in the same company, even if there’s little to no overlap between them. But I don’t think that those types of decisions will affect the availability of ICE’s too much, if there’s still robust demand for them.
with vehicles limited to the used market. ICE model choices will become rapidly fewer as 2040 approaches. Furthurmore, as EV adoption rises, the number of gas stations will go down with reduced demand. Use of ICEs will become increasingly less convenient.
Seems to me that ICEs have maybe 20 years left, regardless of the price of gas or the size of rebates.
Oh, I doubt that very much. I mean, look at EV’s - there’s limited models, and a far more inconvenient fueling system (at least away from home) than gas stations, and there’s lively demand for those vehicles. If the cost of ownership of an ICE remains materially lower than that of EV’s, then there will continue to be a vibrant and non-trivial ICE market. And I think that’s pretty likely to be the case in the U.S., and probably a number of other non-trivial markets as well. Even the avid enthusiasts at BNEF think that the majority of new cars sold in 2030 globally will still be ICE. Plus, in the U.S. most of the used car market in 2042 will still be ICE’s no matter how fast we race towards an electric future - we’re just not going to get to 100% EV’s in the U.S. quickly enough for the majority of used cars to be EV’s within 20 years.
But I think ICE’s will continue to be a solid alternative, because they’ll continue to be pretty expensive compared to EV’s. We’re pretty far along in squeezing economies of scale out of designing and manufacturing batteries and other EV systems, and running into the factors that lead to supply curves always sloping upwards (ie. that the marginal cost rises as quantity provided rises) - scarcity of inputs. EV’s need raw materials and components (like lithium, nickel, and cobalt) which are rising in price with the increased demand. At least one automaker (Stellantis) believes that there will never be an EV product that will be economically viable for average wage earners - they’ll always be too expensive:
Stellantis, now the 2nd biggest collection of auto brands in Europe behind Volkswagen, has said the high price of new electric vehicles and the absence of cheap ICE ones will price average wage earners out of the market, and that is likely to trigger political resentment.
https://www.forbes.com/sites/neilwinton/2022/08/21/accelerat…
It is possible (though I doubt it) that Europe will hold fast on their carbon regulations that will make it impossible to make money selling an ICE car by the turn of the decade. I don’t think that will ever happen in the U.S.
Albaby