EVs are all the rage right now. However, it used to be that people were skeptical of EVs, and everyone expected the proliferation of electric vehicles to take a long time, mostly due to the wary nature of consumers towards EVs.
But the recent EV explosion is facing different hurdles.
Everywhere you look, people are craving electric vehicles—but manufacturers just can’t keep up. A visit to many big-name EV manufacturers’ websites reveals that they no longer accept orders for their most popular electric models. So, why is there an EV shortage, what’s causing it, and when will it end?
Why Is There an EV Shortage?
Electric vehicles have seen a huge spike in interest due to the extreme hike in fuel prices. Especially because you can essentially charge your EV free of charge. Combine this with the fact that most EV manufacturers are legacy automakers trying to figure out how to streamline their electric vehicle supply chain, and you have shortages across the auto industry.
Legacy automakers have built gasoline-powered vehicles for decades, but EVs present a unique challenge. Sourcing batteries and building infrastructure to manufacture these vehicles present completely new challenges. According to Barron’s, metal prices for EV batteries have risen about 40% through 2022. Obviously, this presents a challenge for automakers and is something they need to adapt to in terms of producing electric vehicles.
The plants that produce electric vehicles must also be built from scratch or adapted from traditional assembly lines to accommodate the unique needs of EVs and their platforms. The building or conversion process takes time and contributes to the shortage of vehicles produced because EV manufacturers are learning on the fly.
Unrelenting Demand Meets Supply Chain Problems
The demand for EVs is currently higher than it has ever been. According to Energy.gov, sales of plug-in vehicles almost doubled from 308,000 units in 2020 to 608,000 in 2021. While this figure includes the sale of plug-in hybrid vehicles, the growth is astonishing, nonetheless.
The supply chain shortage is hitting EVs especially hard regarding semiconductors. EVs require more chips than regular vehicles, resulting in extended wait times for consumers eager to get their hands on an EV. Huge consumer demand due to the EV boom is creating issues for EV manufacturers, though the semiconductor shortage is affecting industries worldwide.
The insatiable appetite for EVs, combined with the shortage of materials and manufacturers’ inability to ramp up production, has created wait times that extend through the end of the year for many manufacturers.
EV Manufacturers Are No Longer Taking Orders
Currently, Ford is no longer taking orders for the 2022 F-150 Lightning, an especially tough hit for Ford because the Lightning is an electric version of their best-selling F-150 EV pickup truck.
Volkswagen is also having problems keeping up with consumer demand for their EVs. As per the Financial Times, Volkswagen’s CEO, Herbert Diess, said that for all intents and purposes, they’re sold out of EVs for the rest of 2022.
We are basically sold out on electric vehicles in Europe and in the United States…
Hyundai is currently selling its IONIQ 5 EV in extremely limited quantities. The IONIQ 5 EV is only sold in select states, which speaks to its popularity and the issues manufacturers are having in keeping up with demand. General Motors is also experiencing the huge toll that consumer demand and supply chain issues are exerting on their manufacturing capabilities.
According to CNBC, people ordering a Hummer EV pickup won’t receive it until 2024, highlighting just how difficult it has been for manufacturers to keep up with production. The fact that these problems are affecting small manufacturers, along with huge legacy automakers like VW and GM, just shows that consumers can’t get enough of EVs.
Automakers Will Adapt—But EV Shortages Won’t End Soon
The production of EVs will stabilize as supply chain problems start to alleviate. Another factor that’ll help automakers sell more EVs is the continued streamlining of their production processes to more efficiently accommodate EV manufacturing.
Once manufacturers completely switch their production resources (including their respective supply chains) towards EV manufacturing, more and more EVs will roll out of assembly lines!