EV outlook: trend for greater electrification to continue in 2024, at slower pace
For electric vehicle (EV) makers, 2023 has been a double whammy of high inflation and high interest rates for car buyers, which has led big names like Tesla to cut prices.
IGTV's Angeline Ong says EV makers will likely need to shift down a gear in 2024, even though greater electrification is set to remain the status quo.
(Video summary)
2023: tough Times for EV Industry
It has been a tough year for electric vehicle (EV) manufacturers, like Tesla and Lucid, because the high inflation and interest rates have made it harder for people to afford their cars. As a result, these companies had to lower their prices in order to encourage people to buy, but this has made their profits smaller.
Tesla's stock price took a bit of a hit because of this, but it has recovered somewhat. Lucid, a smaller rival of Tesla, is also facing challenges and has had to reduce its production forecast for the year.
But it's not just Tesla and Lucid that are facing difficulties. Other EV car makers and battery manufacturers are also having to adjust their plans.
LG Energy Solutions, a battery maker from South Korea, has said that the demand for EVs in 2024 might not be as high as they originally thought because of uncertainty in the economy. Even Honda and General Motors who had planned to work together on making cheaper EVs, had to cancel their $5 billion collaboration after only a year.
More challenges in 2024
Looking ahead to 2024, the EV industry is expecting more challenges. While experts predict that more and more people will switch to EVs around the world, they also believe that borrowing money to buy these cars will still be expensive. Because of this, the focus for the EV sector will likely be on meeting the current demand for EVs, rather than trying to sell as many as possible.
To sum it up, the EV industry is struggling because of inflation and high interest rates in 2023. Companies like Tesla and Lucid have had to lower their prices and adjust their production plans, and other players in the market have had to do the same. As they look to the future, the sector expects to face more challenges and will prioritize meeting the current demand for EVs over aggressive growth.
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