Global Carmakers To Spend $515B On Electric Vehicles Over Next Decade

An analysis from Reuters revealed that 32 automakers will spend over half a trillion dollars on electric vehicles and batteries by 2030.

Based on company disclosures, a global breakdown of the numbers by Reuters revealed European automakers will spend $112 billion, with German company Volkswagen contributing to half of that amount. Volkswagen has a huge lead among global automakers in investments in battery technology and electric vehicle manufacturing.

Chinese automakers account for $124 billion, which is 66% of the total investment from Asia.

Tesla, General Motors, and Ford each made roughly the same investment amount — about $25 billion — into battery technology investments.

In 2018, Reuters conducted a similar analysis that found global automakers planned to spend $300 billion on electric vehicles and the technology to run them. The spike in spending is likely a result of zero-carbon mandates from countries around the world, demonstrated by pledges made at COP26 in Glasgow, Scotland

Brian Maxim, head of global powertrain forecasting at AutoForecast Solutions, told Reuters that investments in electric vehicles may not meet the demand, as all the investment by global carmakers may mean little without incentives. This includes selling the public on buying electric vehicles, spending on the creation of more charging infrastructure, and maximizing grid capacity.

“Once a few manufacturers announced EV programs, everyone else had to announce their own or be viewed as being left behind,” Maxim told Reuters. “This leaves a lot of vehicle manufacturers planning significant volumes for a vehicle category that has unknown consumer acceptance and will have minimal to no profit [for years].”

Tesla, which only makes electric cars, has invested billions of dollars in “giga factories” near Berlin and Austin, Texas, that will boost their production capacity.

Different projections have been made by consulting firm AlixParnters. The firm estimates investments in electric vehicles will reach $330 billion by 2025.